noxious markets Flashcards
four types of markets put in two categories
the first two parameters characterize the consequence of particular markets
The other two characterize the sources of particular markets , the underlying condition of market agents
two types of interests people have
welfare interests concern a persons overall good, and agency interests concern a persons ability to participate in deciding matters that bear on that good. We can define a set of basic interests for people, interests in minimum levels of well-being and agency, and ddefine extremely harmful market outcomes as outcomes that leave these basic interests unsatisfied
Markets can be extremely harmful for society
THe operation of these markets can undermine the social framework needed for people to interact as equals, as individuals with equal standing
Some markets are characterized by very weak or highly asymmetric knowledge and agency on the part of market participants. Agency failures can occur because
some of the direct participants lack important knowledge or because the market has serious indirect effects on people who are not involved in the market transactions
Some markets reflect the underlying extreme vulnerabilities of one of the transacting parties
When people come to the market with widely varying resources or widely different capacities to understand the terms of their transactions, they are unequally vulnerable to one another. In such circumstances, the weaker party is at risk of being exploited. Some markets not only reflect the different and unequal underlying positions of market agents but may also exacerbate them by the way they operate
The status of equal citizenship requires that
all have equal basic political rights and freedoms, including rights t ospeech and participation in the political process
Equal rights and freedoms within civil society, including rights to own property and
Equal rights to a threshold of economic welfare and to share to the full in the social heritage and to live the life of a civilized being according to the standards prevailing in the society
How should we decide what approach to take to a noxious market
Which policies it makes sense to adopt depends on the source of the markets noxiousness, which of the four parameters is in play
