The Market

Now, we’re going to study the laws of economics which operate in a process of social cooperation we will call the “market economy.” The market economy is a social system based on the division of knowledge and on the private ownership of consumer and producer goods and services. It is a social process which rests on contractual ties. It is a social process in which the state either does not exist, because it is unnecessary, or the role of the state is reduced to a minimum and consists of preventing actions that disrupt the peaceful process of social cooperation. Social scientists are debating on whether a monopolistic agency is necessary for this or not. Some people—the minarchists—believe a minimal state is necessary. For what purpose? To prevent crime, to stop it in situ with law enforcement forces, and to punish the perpetrators through the judicial system. Meanwhile, there are other scientists, including yours truly, who are anarcocapitalists and believe that an agency which appropriates monopolistic power to provide these services is unnecessary and also highly disruptive. We believe that a constellation of private agencies, of security companies like Prosegur, etc., would prevent, stop, and punish crime far more effectively, in a manner which would be qualitatively better and would also protect victims far more. At present, the frontiers of scientific research lie in this issue. It is not necessary for you to adopt a stance on it, because, practically speaking, a market economy would work in a limited state.