I’m re-reading Radical Markets by Eric Posner and Glen Weyl for a project I’m working on. And I have been struck by this in a new foreward by Vitalik Buterin and Jaron Lanier:
It is important to understand the proposed radical markets in the spirit in which they are offered. A mechanism cannot become the center of human civilization but must serve as a tool in the context of civilization. That point should be implicit, since many methods are proposed here; obviously, the intent is not to make any one of them singularly dominant.
If you didn’t catch the Radical Markets hype a year ago, it’s essentially an argument to inject market mechanisms, and our greater knowledge of how markets work, into more aspects of society. Such as by introducing quadratic voting in elections to better measure intensity in preferences.
Or, more spectacularly, perpetually auctioning the use rights of private property. Essentially, allowing anyone to go and bid on any property at any time. The idea being (among other things) to better capture the value of these assets in the tax system.
There are problems with some of these ideas. Initially at least. Such as that without initial capital reallocation, the removal of certain property rights could lead to more inequality. Or that many people desperately need the stability afforded them by property ownership.
But I really like this argument that we need to consider the idea within context rather than turning it into a straw man. We need to think of them as mechanisms that could be strategically employed, within an established political economy.
Especially as our discourse has sped up, as more diverse voices added, it is tempting to summarily dismiss new ideas because they aren’t perfect. Because there are negative consequences that hadn’t been considered.
I like Ryan Avent’s reading of Radical Markets as a work of political philosophy. On the need to consider radical solutions to big problems. As an appeal to consider market mechanisms in areas that we currently don’t.
Again from Buterin and Jaron Lanier:
Abstractions can play out differently according to context. Any mechanism can be turned into an instrument of violence if it is overly amplified and drowns out every other process in a society. And yet without better mechanisms, we are doomed to stumble around, failing to address the complexities of our times.
None of the rules in society are natural. They’ve all been contrived. The questions are why and by whom. Injecting markets into more areas of society may make sense. Or maybe the inverse.
New ideas may not suit as panaceas, but do right in specific situations or after some adaptation. Perhaps it’s time for something more targeted.
As always my emphasis