I enjoyed the responses to Michael Sandel’s critique of markets in the How Markets Crowd Out Morals forum on the Boston Review website. Sandel’s essay follows in the wake of his new book, What Money Can’t Buy: The Moral Limits of Markets.
Most of the response are worth reading, but I particularly enjoyed the one by Herb Gintis. Some of the more interesting parts of Gintis’s piece were as follows:
The idea that some valuable things should not be bought and sold on markets has been known for centuries, certainly since the anti-slavery movement in England. All mature economists understand this well. Just because some otherwise-obscure economist can gain ﬁfteen minutes of fame by advocating the suppression of non-monetary gift-giving doesn’t mean we should interpret his claims as an exercise of brilliant economic argument. ...
By focusing on the marketability of particular things, Sandel misses the larger effect of an economy regulated by markets on the evolution of social morality. Movements for religious and lifestyle tolerance, gender equality, and democracy have ﬂourished and triumphed in societies governed by market exchange, and nowhere else.
My colleagues and I found dramatic evidence of this positive relationship between markets and morality in our study of fairness in simple societies—hunter-gatherers, horticulturalists, nomadic herders, and small-scale sedentary farmers—in Africa, Latin America, and Asia. … [W]e measured the degree of market exposure and cooperation in production for each society, and we found that the ones that regularly engage in market exchange with larger surrounding groups have more pronounced fairness motivations. The notion that the market economy makes people greedy, selﬁsh, and amoral is simply fallacious.
As an aside, an interesting question is the direction of causation between markets and morality. I suspect the emergence of markets is endogenous to the characteristics of the populations in which they emerge.