Can the free market encourage morality? Many great thinkers have claimed that the market corrupts us, but authors VH Storr and GS Choi argue that it makes us better people.

Author:Williams, Stephen

DO MARKETS CORRUPT OUR MORALS?

By VH Storr and GS Choi

26[pounds sterling] Palgrave Macmillan

ISBN 978-3-030-18416-2

What links Aristotle, Thomas Aquinas, Jean-Jacques Rousseau, Adam Smith and Karl Marx? All of them have tackled the central question that this book poses--do markets corrupt? Following in the footsteps of those great minds, the authors investigate the most convincing theories about how markets work today and have worked throughout history to draw their own conclusions about the often uneasy relationship between markets and morality.

Concerns about the potentially negative moral effects of engaging in market activity have a long history. Aristotle argued that there were two types of wealth acquisition: "One is a part of household management, the other is retail trade: the former necessary and honourable, while that which consists in exchange is justly censured; for it is unnatural, and a mode by which men gain from one another." His thinking was later echoed by Thomas Aquinas, who believed that a "just price" should not be determined by the buyer's willingness to pay, but by the costs the seller incurred in producing the good.

Even Adam Smith, who famously celebrated the potential of markets to deliver material wealth, believed that there were moral costs associated with life in market societies. In The Wealth of Nations, Smith argued that the typical labourer in market societies spends his life performing a "few very simple operations" and, as a result, has "no occasion to exert his understanding, or to exercise his invention in finding out expedients for removing difficulties which never occur".

Concerns with the market economy were famously developed by Karl Marx, who believed that under it workers became estranged from themselves, their labour, the product of their labour and one another. In short, he believed that the greater the scope of market exchange relations, "the more egoistic and asocial man becomes". Arguably, such arguments have gone mainstream in the wake of the global financial crisis, which provoked a fresh bout of soul-searching around global market activity.

When Lehman Brothers, one of the most venerable banks in the US, crashed in 2008, a culture of "sub-prime" lending was revealed that exploited low-income and financially unsophisticated families, tempting them to borrow what they would be unlikely to be able to repay.

Sub-prime lending may not have been illegal, but there is a strong argument that it...

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