Human Rights Promotion (18): To What Extent Can We Count on the Free Market?

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activism / human rights promotion

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Why not use the free market to promote human rights? The free market – or the market for short – is the name of the institution, protected by government rules, which allows individual or collective agents such as firms to freely exchange goods and services. Agents exchange things in the market for self-interested reasons and they tend to use money as the medium of exchange, but that doesn’t mean we’ll only see greed and accumulation of wealth resulting from the operation of the market. I’ll show that we can, to some extent, count on the market to further the cause of human rights.

But let’s start by complicating things a bit:

  • The market can either benefit or harm human rights.
  • And human rights can either benefit or harm the operations of the market.

Hence, the relationship between market and rights is difficult, to say the least. Here are a few examples:

Some human rights are a direct benefit to the market. Take for example the right to private property. This is a human right and it’s one that is generally conceived to be essential for the efficient operation of a market (some even argue that this right justifies free markets, but I want to sidestep issues of justification here and focus on conseqquences). You can construct a similar argument in the case of other rights such as the right to free movement, to assembly etc. At other times, however, human rights can hinder the market: privacy is a human right but privacy can cause asymmetrical information which in turn causes market dysfunctions.

trickle downMarkets can have a similar two-sided effect on human rights. Conventional wisdom says that the market is the institution that delivers the highest possible level of prosperity, compared to other ways of organizing the economy. Higher prosperity may benefit certain specific human rights such as the right not to suffer poverty, the right to work etc. This benefit may occur because additional wealth “trickles down” or because additional wealth means additional redistribution. In general, it’s the case that rights cost money, so increased prosperity should, all else being equal, lead to increased rights protection across the board.

A more indirect way in which the market benefits rights is through it’s focus on individualism: the market – as opposed to a centrally planned economy – allows individuals to choose when and what to trade. Individual freedom is also at the heart of human rights. Some have also argued that the rational self-interest that is typical of people engaging in market transactions counters some dangerous and often violent passions such as xenophobia, nationalism and racism. If people trade with one another, they may become more tolerant of one another, if only because trade requires contact, respect, trust and peace. Tolerance and peace are of course also beneficial to human rights. And, finally, both the market and human rights requires the rule of law. If markets foster the rule of law, then that will benefit rights as well.

However, other aspects of markets can harm human rights. A strict interpretation of property rights – something we often hear from defenders of the market – may make redistribution difficult if not impossible, and some rights depend sometimes on redistribution. Think again of the right not to suffer poverty. More generally, markets can have two types of effects that may harm human rights indirectly:

  • commodification by John T Cantu

    commodification by John T Cantu

    Markets tend to “colonize” areas of life where an exchange of things for money is perhaps not the best way to proceed. Some goods can only be valued when they are shared rather than exchanged (e.g. art). In other cases, exchanging goods can destroy their value (e.g. political votes), just as pricing goods can destroy their value (e.g. gifts). I can also mention some types of commodification of the body such as prostitution or organ trade. While commodification of the body is not necessarily a rights violation in itself, it does devalue the dignity of human life. People are treated as means rather than ends, and a devaluation of human beings makes human rights violations more likely.

  • In some sense, this instrumentalization of the other is inherent in all market transactions, not just those in which bodies or body parts are traded. Market transactions are by definition self-interested and impersonal. We only buy or sell when that makes us better off and we don’t need to get to know our buyers or sellers. We use them simply to satisfy our needs. While self-interest and lack of personal relationships in one area of life do not necessarily harm relationships, communities, caring and common deliberation on the public interest in other areas, they can do so when markets “colonize” those other areas.

And, finally, there’s the risk of exploitation in market transactions, which I have discussed here.

I’m more interested in the effects of the market on human rights than in the effects of human rights on the market. Human rights are the ultimate good, and markets are generally a means (at best, markets are one form of exercise of certain human rights). Since the effects of the market on rights can go either way, the question becomes one of limits. If the market harms human rights, or if it expands into areas where market-transactions can indirectly harm human rights, then we have good reasons to limit the operations of the market. However, when doing so we must take care not to go too far and undo the positive effects of markets.

These limitations don’t always have to be of a legal nature. A good public education system can create a culture that helps to keep markets in their place. Governments can acquire art collections and thus remove them from the market. Or they can promote organ donation in various ways (e.g. reciprocity and presumed consent) so that organ shortages don’t force people into markets (legal or illegal markets). Welfare can help poor people avoid exploitative market transactions. And so on. However, legislation is often unavoidable if we want to protect rights against the market.

More posts in this series are here.

(image source, image source)

1 Comment

  1. Pingback: Self-Defeating Human Rights Policies (9): Child Labor Legislation | P.a.p.-Blog // Human Rights Etc.

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