The John Templeton Foundation has placed online this outstanding symposium on the question, “Does the free market corrode moral character?” The answers take the form of short, readable essays by a dozen or so very sharp minds (including philosopher Michael Walzer, economist Tyler Cowen, and even chess-champ-turned speaker & activist Gary Kasparov). A few of the respondents answer with a resounding “No!”, while a couple answer with a half-hearted “Yes, sort of.” Perhaps not surprisingly, a lot of the answers amount to a balanced, “Yes and no,” or “It depends,” or “Yes, but free markets are still better than the alternative(s).” I’ve read about half of the answers, and all so far are excellent.

It’s worth noting (and several of the essays hint at this) that the question is ambiguous. Just what do you mean by “the free market?” Do you really just mean free markets per se in all their manifestations? Or do you mean the kind of free market dominated by the modern, widely-held, professionally managed corporation? Do you mean Russian free markets, or Swiss free markets? Or do you mean (as many people seem to when they refer to the ‘free market’) 21st Century globalization? It seems likely that whatever moral effects we observe — whether positive or negative, and whether outweighed or not by other effects — are going to find their source not just in the basic practice of free (voluntary) exchange, but in the particular mechanisms, conventions, and institutions through which trade is carried out. As with any complicated system, the key to getting the most (socially) out of the free market is to figure out which risks must be accepted, which can be mitigated, and which can be eliminated, and at what cost.

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Relevant Books:
Moral Markets: The Critical Role of Values in the Economy by Michael C Jenson
Moral Basis of the Market Economy by Brian Griffiths
Morals and Markets: An Evolutionary Account of the Modern World by Daniel Friedman