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Regulation is part of a free market, but governmental regulation is not (i.e., regulation imposed by a monopolistic entity). There are many forms of private go

by asift 11y ago

Regulation is part of a free market, but governmental regulation is not (i.e., regulation imposed by a monopolistic entity). There are many forms of private governance and regulation that protect consumers. That's not to say free markets are utopias, but believing that governments are the only source of regulation is incorrect. In fact, in many cases private governance is far more effective (e.g., the private regulation Uber is subject to is stronger and more efficient than the governmental regulation traditional taxis are subject to). See "Private Governance" by Edward Stringham for some good examples of market governance in action. The book received the following review from Peter Thiel: "Stringham dispels state-worshipping fiction with historical fact to show how good governance has preceded Leviathan, ignores it when necessary, and can surpass it when it fails."

tomp 11y ago
> Regulation is part of a free market, but governmental regulation is not Until someone comes, holds a gun to your face and takes your sandwich. Then you'll be thankful for government regulation. I'm absolutely certain that the government's (attempt of a) monopoly on violence is one of the most crucial aspects of free markets. Another is contract law.
- TeMPOraL 11y ago
  Governments did not came from outer space, nor are they form a separate magisterium that's unrelated to free market. It's something that naturally forms as society grows larger than few hundred members and the simple interpersonal methods of coordination and punishing defectors (like losing support of the whole clan if you cheat) stop working. The whole idea of separating government from market models seems strange to me. Frankly, I fail to see how you can hold a working market in a big population without a somewhat monopolized government structure. If suddenly, say, the USGOV disappeared, leaving behind a libertarian utopia, I'm pretty sure it would quickly degenerate into acts of violence, an era of warlords and famine, after which people would probably figure out that a single entity enforcing some rules was generally not a bad idea.
- asift 11y ago
  There are reasonable and intelligent criticisms of market institutions. This is not one of them. Exactly what recourse would I have against someone who stole my sandwich? Unless I know the person or there is solid evidence to identify the individual, the costs of investigation and prosecution far exceed the value to be recouped. Police will take my information, file a report, and nothing else will happen. Not only is that state not helpful under these conditions, but private institutions have often found solutions to similar problems before the government does. Look at Paypal. They faced very similar conditions of fighting fraud and theft that couldn't be remedied through legal means, so they developed many private forms of regulation which allowed online exchange to flourish.
  - TeMPOraL 11y ago
    The difference between Paypal and real life is that Paypal works with arbitrary laws they set up, and real life works with the laws of physics. You can prevent fraud on the Internet by doing tricky filtering. You can't prevent someone from stealing a sandwich at gunpoint by rewriting how the universe works. Enforcement is not perfect, but that the police can punish the armed sandwich thief in principle is already a deterrent. It is common knowledge who in this situation would be in the right. Compare with government-free world, where to determine who's right we'd have to make our security companies get into a firefight over it. And they'll probably decide that fighting isn't in their best interest and shoot us instead. They can always find more customers.
    - asift 11y ago
      There is very little reason to believe private security providers would resort to "firefights" to resolve conflicts. This is an incredibly expensive and undesirable solution for customers. Go back ten years and have a conversation with someone about a private taxi company that uses technology to operate outside of existing regulations. You would hear outrageous claims about murderers, rapists, and thieves using the system to exploit customers. Of course, Uber drivers can and have assaulted people, but it turns out there are all sorts of creative solutions and private incentives that undermine these outcomes. Fortunately, the future does not lie in the hands of the uncreative people of the past and present. It's the people who can actually envision and deliver solutions--people like Kalanick and Camp--that determine the future.

by asift 11y ago

tomp 11y ago

> Regulation is part of a free market, but governmental regulation is not Until someone comes, holds a gun to your face and takes your sandwich. Then you'll be thankful for government regulation. I'm absolutely certain that the government's (attempt of a) monopoly on violence is one of the most crucial aspects of free markets. Another is contract law.

TeMPOraL 11y ago
Governments did not came from outer space, nor are they form a separate magisterium that's unrelated to free market. It's something that naturally forms as society grows larger than few hundred members and the simple interpersonal methods of coordination and punishing defectors (like losing support of the whole clan if you cheat) stop working. The whole idea of separating government from market models seems strange to me. Frankly, I fail to see how you can hold a working market in a big population without a somewhat monopolized government structure. If suddenly, say, the USGOV disappeared, leaving behind a libertarian utopia, I'm pretty sure it would quickly degenerate into acts of violence, an era of warlords and famine, after which people would probably figure out that a single entity enforcing some rules was generally not a bad idea.
asift 11y ago
There are reasonable and intelligent criticisms of market institutions. This is not one of them. Exactly what recourse would I have against someone who stole my sandwich? Unless I know the person or there is solid evidence to identify the individual, the costs of investigation and prosecution far exceed the value to be recouped. Police will take my information, file a report, and nothing else will happen. Not only is that state not helpful under these conditions, but private institutions have often found solutions to similar problems before the government does. Look at Paypal. They faced very similar conditions of fighting fraud and theft that couldn't be remedied through legal means, so they developed many private forms of regulation which allowed online exchange to flourish.
- TeMPOraL 11y ago
  The difference between Paypal and real life is that Paypal works with arbitrary laws they set up, and real life works with the laws of physics. You can prevent fraud on the Internet by doing tricky filtering. You can't prevent someone from stealing a sandwich at gunpoint by rewriting how the universe works. Enforcement is not perfect, but that the police can punish the armed sandwich thief in principle is already a deterrent. It is common knowledge who in this situation would be in the right. Compare with government-free world, where to determine who's right we'd have to make our security companies get into a firefight over it. And they'll probably decide that fighting isn't in their best interest and shoot us instead. They can always find more customers.
  - asift 11y ago
    There is very little reason to believe private security providers would resort to "firefights" to resolve conflicts. This is an incredibly expensive and undesirable solution for customers. Go back ten years and have a conversation with someone about a private taxi company that uses technology to operate outside of existing regulations. You would hear outrageous claims about murderers, rapists, and thieves using the system to exploit customers. Of course, Uber drivers can and have assaulted people, but it turns out there are all sorts of creative solutions and private incentives that undermine these outcomes. Fortunately, the future does not lie in the hands of the uncreative people of the past and present. It's the people who can actually envision and deliver solutions--people like Kalanick and Camp--that determine the future.