Are free markets compatible with individual freedom?

Free markets mean an economic system where private businesses are able to determine prices in order to compete with other businesses. Some argue that free markets are compatible with individual freedom whilst others argue that free markets are not compatible with individual freedom. This essay will explore both avenues and come up with a conclusion.

Liberals will argue that free markets are compatible with individual freedom because “individuals have the autonomy to direct their own actions unless they voluntarily agree to follow the orders of someone else”[1] and this is comes under individual freedom that liberals believe in. Secondly, in a free market the “allocation of people to activities is the result of the self directed choices of persons”[2] no one is forced to work for a specific employer and no one is forced to buy products this shows how individuals are in control of their actions. Thirdly, a person has a range of choices that he or she is able to make and this is due to the free market which has expanded the range of choice. The economic growth that the free market has brought about has improved the standard of living of most of the population and in turn has “expanded the range of alternatives.”[3] Fourthly, classical liberals will argue that in a free market, economies advocate for limited control of the state over the forces of production and consumption (West, 2010)[4] and this shows how free markets are compatible with individual freedom because there is less control and involvement from the government into other peoples an affair. This means that the “principles of free market economies guarantee the protection of sanctity of private property.”[5] Lastly, “by predetermining the prices the freedom of buyers to negotiate their own prices is limited.”[6] Free markets also encourage equality and liberty for all individuals (Friedman, 1962).[7] Individual liberty grants people freedom to enjoy economic, political and social rights without discrimination and in a free market the forces of demand and supply means that there is little discrimination. An “organization cannot afford to sell at different prices to different groups of people since it will become less competitive”[8] and all this shows how free market is compatible with individual freedom.

However, some may argue that free markets are not compatible with individual freedom. The control of information is essential for any business or company and this information can either increase the wealth of a business or “damage business interests and profits.”[9] An example could be the food industry where even thou it is operating in a free market it is not compatible with individual freedom. This is due to the failure of a better regulated food industry and the reason why the food industry is not regulated is because the “corporations have argued … that any such regulation would actually hurt consumers rather than ensure they are better informed.”[10] Transparency is a threat to corporate profit and interest and without transparency then the people are unable to make informed decisions which shows how the free market clearly is not compatible with individual freedom. Moreover, people may have access to most things but that doesn’t mean that they are able to afford it therefore there is no equality of opportunity that Liberals argue about.

To conclude, some argue that free market is compatible with free market because there is less control and involvement from the government into other people’s affairs and it encourages equality and liberty for all individuals (Friedman, 1962)[11]. Others will argue that a free market is not compatible with individual freedom because information is controlled by corporations which mean people cannot make an informed decision. However, I believe that a free market is compatible with individual freedom because, on the whole, people are able to have control over their actions without the interference of government.

 

Bibliography:

 

[1] Wright, E. and Rogers, J. (2011) American society. 1st ed. New York: W.W.Norton & Company, 2015, pg 10-27

[2] ibid

[3] Ibid

[4] West, T. (2010). The Economic Principles of America’s Founders: Property Rights, Free Markets and Sound Money. Available at: http://www.heritage.org/research/reports/2010/08/the-economic-principles-of-america-s-founders-property-rights-free-markets-and-sound-money (Accessed: March 16, 2011)

[5] Relationship Between Free Market Economy And Individual Liberty (2017) Customwritingtips.com. Available at: http://www.customwritingtips.com/component/content/article/34-business-studies-/3046-relationship-between-free-market-economy-and-individual-liberty.html (Accessed: 20 April 2017)

[6] ibid

[7] Friedman, M (1962). Capitalism and Freedom, Chapter 1, “The Relation Between Economic Freedom and Political Freedom,” pp. 7-17. Chicago: University of Chicago Press, 1962, Available at: http://www.mtholyoke.edu/acad/intrel/ipe/friedman.htm (Accessed: March 16, 2011)

[8] ibid

[9] Clark,I. ( 2013) the need for information: are the free market and freedom of choice incompatible? – infoism, Available at: http://infoism.co.uk/2013/03/the-need-for-information-are-the-free-market-and-freedom-of-choice-incompatible/ (Accessed: 6 march 2017)

 

[10] ibid

[11] Friedman, M (1962). Capitalism and Freedom, Chapter 1, “The Relation Between Economic Freedom and Political Freedom,” pp. 7-17. Chicago: University of Chicago Press, 1962, Available at: http://www.mtholyoke.edu/acad/intrel/ipe/friedman.htm (Accessed: March 16, 2011)

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