Markets and Marketplaces
February 27, 2006
11:36 a.m., MT

Still have a lot of stuff piled up, but before I forget, I want to take the time to expand on a conversation I entered into briefly over at jomama's place. It took place in the comments section of his Command and Control entry; the part that's of interest to me is the talking past each other that went on regarding the concept of markets and marketplaces.

The assertion was made that " ... the 'marketplace' is itself a creation of coercive systems. Free people who preceeded the last 10k years of control-freakism didn't go about their business in any kind of 'marketplace'." The question that comes to mind -- indeed, which was asked and not really answered -- is, "How, then, did they go about their business?"

The answer is simple, really. They did rely on markets and marketplaces -- they simply weren't called that. An excellent quote from a book I'm currently reading illuminates further:

There are only two ways to get what you want in life. You can get it honestly, by trade, work or some other bargain -- an economic means of some sort. Or, you can get it dishonestly, by stealing it or taking it away from someone -- that is, by political means. .... This distinction works for "things" such as automobiles and whiskey. It also works for other "wants" -- such as sex, ambition, and vanity.

Did you catch the fundamental idea implicit in the above? A market exists wherever there's a need or want. A guy building a house needs materials; typically these days, he buys them from stores that sell lumber, insulation, nails, plumbing fixtures, etc. A guy who wants sex could get in trouble in this country if he tried to buy it by exchanging dollars directly for the service he wants. Instead, he'd probably try buying it indirectly, typically by taking a woman out for a date. The price required to get what he wants varies tremendously, though. Some women will tumble on the first date, irrespective of whether she's treated to a McDonald's or Spago meal, while others won't, even after several dates -- in which case the guy will probably move on. The former is what many people seem to have in mind whenever a market or marketplace is mentioned. If that's the case, then it's not surprising that issues involving control also come to mind. However, the latter is every bit as much a market transaction.

To be more clear, let's consider an example. A marketplace you can think of as "sex with Sunni" exists. Its supply is very limited, but so is the demand (all jokes to the contrary of either point aside). The state did not set up that marketplace, nor does it control any transactions within it. I control the supply side, while any individual who's interested in some exchange controls the demand side. Negotiations could proceed well, in which case the transaction, we hope, proceeds satisfactorily; or they may break down. Money may or may not be involved; judging by this marketplace's history, certain emotions are the more usual coin of the realm.

The fact that I never considered this as an explicit marketplace doesn't change the fact that it is and has been one for many years. Similarly, the fact that primitive individuals didn't call their exchanges of meats, grains, or labor "markets", nor set up explicit rules governing transactions, doesn't mean that they weren't. Markets are how people have exchanged stuff they have for stuff they want since time out of mind. A marketplace is simply any meeting of individuals interested in exchanging stuff. With that understanding in place, it becomes clear that the idea of a monolithic marketplace is almost as silly as the idea that all markets can be controlled by any central authority.

[On the book I quoted: it's quite likely I'll be reviewing it for March's Salon, so I'm loathe to say more about it at present. I'm not finished reading it either, so until that happens I'm not comfortable recommending it.]

Sunni

Comments: 7 people have contributed to the conversation

On Monday, February 27th, at approximately 2:40 p.m. Mountain time, Ian Scott said:

I'll provide some emotions, but the sex better be damned good! If not, I want my emotions back!

On Monday, February 27th, at approximately 4:17 p.m. Mountain time, Sunni said:

Ha! Very funny, Ian. Sorry, though, that marketplace isn't open at present.

On Monday, February 27th, at approximately 11:54 p.m. Mountain time, Wolf DeVoon said:

A marketplace you can think of as "sex with Sunni" exists. Its supply is very limited, but so is the demand...

A technical point: "Demand" is economic cash, which means: ample coin of the realm to command a good or service. Because supply is limited, it takes a lot of [something pretty darn special] to win fair damsel.

On Tuesday, February 28th, at approximately 2:24 a.m. Mountain time, Robert Noval said:

"A market exists wherever there's a need or want."

And it exists whether it's referred to as a market or not; or whether those operating within it recognize it or not. (See "The Mystery of Capital" by Hernando DeSoto), in particular, his overview of American History.

The identity principle manifest yet again. Why do I get so much denial as to the relevance of philosophical abstractions?

I remember reading a book review of yours in LP News a while back. Please advise here when your latest can be seen, I don't frequent that site you mention.

I'm relieved you're not doing "The Economic Laws of Scientific Research" by Terence Kealey. I'm working on that and hope to have it on my blog in a few weeks. It's the best free market advocacy book no one(except me)has ever read. It has extraordinary historical perspective that would be highly pertinent to this discussion.

---The Bikemessenger

On Tuesday, February 28th, at approximately 10:26 a.m. Mountain time, Sunni said:

Thanks for the clarification, Wolf. I meant "demand" a bit differently, and failed to clarify that.

And Robert, thank you for stating my thesis much more clearly than I did. You read a book review of mine in the LP News?! That's news to me ... and if by "that site you mention" you mean my Salon, either Tom or I do post an announcement here when a new issue goes up. And of course you've gotten me terribly curious about The Economic Laws of Scientific Research.

On Tuesday, February 28th, at approximately 7:32 p.m. Mountain time, Robert Noval said:

You're welcome;I'm surprised you don't remember. "Healing Our World in an Age of Agression" by Dr. Mary J.Ruwart, a review entitled "Bringing
Liberals to Liberty" by Sunni Maravillosa, Libertarian Party News, January 2004, page 10.

Her's a little preview of my review:
http://www.solopassion.com/node/464#comment-3036

---The Bikemessenger

On Wednesday, March 1st, at approximately 7:41 p.m. Mountain time, Sunni said:

I don't remember because I wasn't asked about it. Not that I'm complaining, though.

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