Liberty Alone

I think Farmer’s Markets are great. Not because I shop at them much (I find them too expensive), not for environmental reasons (I don’t buy into the whole ‘food miles’ thing - its a very bad measure of environmental impact), but because its entrepreneurial.

Producers and organisers have seen a gap in the market and have gone for it, often with great success.

There is a large constituency of people who for whatever reason like to shop at farmer’s markets.
When I occasionally shop at one its due to products that supermarkets don’t provide (the apple juice we used to get from the now closed local market was fantastic and the apples were just as good and cheaper than the supermarket).
Others like the aspect of it coming fairly directly from the producers, other buy into the environmental argument and many people probably have their own reasons or combination of reasons.

Whatever the reasons, Farmer’s Markets have (re?) discovered some things which people value and are willing to pay for (in money and time and travel) and hopefully making themselves a profit.

The essential thing is to keep innovating. Supermarkets and other shops have seen some of the things which farmer’s markets have been doing and adopted aspects, farmer’s markets must adapt to these changes. It will probably mean less profit (as occurs with every entrepreneurial effort after others adopt the methods) so new ideas will need to be tried.

How often do you hear criticisms of the free market, claims that we are living in an era of laissez-faire, that markets rain supreme?
Its something I come across frequently.
Its lesser heard cousin is that laissez-faire or classical liberalism failed in the 19th Century.

Both are absolute nonsense. We never had a laissez-faire system. Even in the heyday of Manchester Liberalism the state still intervened in the economy. Perhaps we were in a situation where the gains from freer trade created more of a boost than the hindrance of intervention, war and imperialism, but it certainly was no laissez-faire or even classical liberal order.

Today we live in an era of vast economic intervention. Corporations depend on the state for their existence, rent seeking is rife. Privatisation is now largely an exercise in extending state control over private business and allowing the state to run things more efficiently.

The only difference is that we are not so exposed to the intervention as we were in the 70s say. Instead the interaction is between us and business and then business and the state in its varying forms.

Even setting aside the argument as to what is the preferable system, this is a gross distortion of the facts.

Today’s Mises.org daily story has more, along with a brief (and insufficient) attempt to attack the assumption of the beneficial state.

I’ve just seen a hint at an idea which is very interesting.

There is an important debate amongst economists starting in the 1920s with Ludwig von Mises’s critique of socialism. This is the Calculation Debate which brings an argument that the socialist economy cannot allocate resources and the calculations needed are not possible. Personally I think this is settled against socialism, at least in the case where we have a non-static economy. Since for the improvement of the situation of people we need a non-static economy and the fact that not everything can be controlled, I think this debate shows that economic socialism is not possible.

A student of Mises, Murray Rothbard, it appears, took this idea further and showed that this economic calculation problem sets a limit on the size of corporations. Anyone who has worked in a large organisation knows that diseconomies of scale really do come into effect. Its interesting to see this outline of an economic argument as to why this happens.

Why then don’t small businesses run rings around big corporations? The answer is that government intervention and regulation favours the big, established concerns.
Like much taxation, regulation costs those with lower income a greater portion of their income. Regulation increases startup costs, big business has more resources to devote to lobbying politicians.

Contrary to what many think, it is not the free market which gives big companies the advantage, it is the lack of free market which panders to them.