RE: [OPE] intermission: value of knowledge

> However, there is a slight difference in the way how these concepts are used.
> Free trade is usually used in the context of international trade whereas
> free market is utilised in the context of domestic markets. But I think that
> they are interchangeable

 
Hi Dogan and Chai-on:
 
I do NOT use these terms interchangeably. It is possible, I think, to
have free trade but not simultaneously free markets. The latter is a
broader and more general term. Free trade is a trade policy (even though
it claims to be a non-policy) by nation states designed _not_ to influence
choices by firms and consumers about whether to purchase domestically
produced or imported goods. No country today practices free trade in relation
to _all_ of their trading parties despite the fact that some governments and
international institutions attempt to push the ideology of free trade on
others.
 
If you have free markets, however, the state has _no_ role in determining
the behavior of business firms (other than, perhaps, legal requirements
that they must pay taxes) Anti-trust policy, for instance, is inconsistent with
free trade (even though, ironically, if there are monopolistic and oligopolistic
firms the necessary conditions to reproduce free markets - if it existed -
 would be undermined). If there are regulations which tell business firms
what they can't produce or what they must produce, how commodities are produced
(and this includes production conditions), what prices must or can't be, or
exclude or require sale to certain groups or individuals then you can't have
free markets. In other words, to use the expressions of mainstream theory,
the decisions about what to produce, how to produce, and for whom to produce
are freely made by firms without any attempts by the state to influence
those decisions. In other words, free markets are entirely a fiction and
have never existed historically - although, obviously, markets have tended
to become more "unfree" as workers and others have struggled for reforms and
have forced states into taking action which limits the behavior of what firms
are allowed to do. It is a reactionary doctrine - despite its pretension
that is represents freedom. Freedom for whom? Ah, that's the reason why it's
reactionary.
 
In solidarity, Jerry _______________________________________________
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Received on Sat Nov 21 07:44:50 2009