The Law of the Market

Abstract

Much contemporary discussion of "the market" assumes that it has an immanent logic that leads inexorably to runaway inequality, an erosion of corporate accountability, and the commodification of education, health , politics, and other basic goods. However, markets arise out of and operate through law not just through public regulation but also through private law regimes (in property, contract, and tort) that create entitlements, enforce market exchanges, and limit expropriation. Appreciating the significance of law as the infrastructure of markets reveals that no particular market structure is inevitable. Instead, every market order is the result of a complex set of legal and political choices.

This Issue of Law and Contemporary Problems investigates the legal foundations of market orders. In this Foreword, we rely upon the Articles that follow to offer an intellectual roadmap for a legally-informed study of the market. These rich and thought-provoking Articles underscore the fundamental role of law in the constitution of markets, as well as the options, limits, dangers, and responsibilities that the legal construction of markets entails.

One lesson that we take from these writings is that the market can be thought of as a thick ethical concept that can be understood only by combing facts and norms, which cannot be prised apart without doing damage to both. This means that different forms of the market in fact instantiate differing normative visions of the market. To flesh out and generalize these evaluative aspects, we conclude in Part VI with a sketch of three competing visions: efficient markets, democratic markets, and liberal markets. We acknowledge that real markets are imperfect instantiations, and at times hybrids, of these ideal-types. In addition, the types may be further divided, oftentimes with crucial distinctions among their rival variants. But for purposes of this Foreword, our goal is modest: we have no ambition to offer a complete taxonomy of market orders or to resolve the debate over the market's normative foundations. We hope only to bring home our conclusion that any adequate inquiry into the market must take this normative debate into account.