Re: gravity and the market

anonymous (
Fri, 28 Mar 1997 16:37:56 -0800 (PST)

The market caters to the local supplies and demands of suppliers
and customers, about which these parties know a great deal.
The market operates in what Covey calls the "circle of influence",
while ignoring idealistic but ignorant desires about what the global
state of the world "should be". These idealistic global desired
states are what critics of the market refer to when they say that the
market is not producing what people really want or need, or what "should"
be produced. For conditions of which customers and suppliers actually
have great and unique knowledge, the market is bringing about desired
states vastly more often than the critics can imagine, or could bring
about in any globally planned way.

Academics misunderstand and often despise markets for two major reasons:
+ They think in a manner with implicit pretense of omniscience,
discounting local knowledge as prejudice to be eliminated.
+ They tend to be funded by governments.

Local knowledge can be perhaps compared to mass, while voluntary
contract and the price system is analogous to gravitaional attraction
in converting local conditions into global order. Price communicates
local knowledge and free local ethical values in the highly compressed,
efficient form of a shared value scale.

When one of these global desires is so compelling and rational,
but obviously unmet, we look for a public goods problem: a
situation where supply of a good is not undertaken because free riders
cannot be excluded.