Does the very existence (and even growth) of government constitute an example of market failure?
Yes, the market failed to prevent violence from being institutionalized (government).
The key issue is too few people realizing the benefits of total freedom before it’s too late.
Some people dont want to realize it.
It represents a failure of the spontaneous order of acting individuals in a given environment to coalesce into a something non-monopolistic.
That can and obviously has happened, because of the nature of the acting individuals and the environments they faced. As the nature of those individuals changes (not “human nature,” but their educational level, longevity, average wealth) and as their environment changes (technology, interconnectedness, norms, religion, geography, weather, personal arms, resource availability, etc.), the spontaneous orders of various milieus will coalesce over time into different states.
In general, I think the conditions are moving toward, and have probably already reached, the level where - if all states were to wither away right now - stable anarchies would develop throughout most or all of the world. Click the link in my sig to see this hypothesis spelled out more fully.
No. The actions which comprise the formation of government are not market actions.
My observation is that market forces failed to prevent the birth and have failed to prevent the growth of government. In fact, it seems to me that the increased wealth with which society has been blessed due to the market has allowed the productive sector to shoulder an ever bigger Parasite on its back.
To take the US Great Depression as an example, even such horrific government policies as those that brought the crisis about were only able to take unemployment to 30%, and only for about a decade. As the market makes society wealthier and wealthier, then, ceteris paribus, the government can undertake bigger and badder policies without worsening the living standards of the citizens on net.
Life in the US during the Great Depression would still probably seem like paradise to people 1000 years prior.
In this way, the market cushions the effects of bad government policy and helps anesthetize the government’s victims to the need to put an end to the government’s policies.
I agree. I think it can be put this way.
It’s not what government rules or policies are framed. It’s the people and their personal behaviour. Human action.
Egypt is a notoriously dishonest society. Many are reluctant to do business there, knowing that the every third person could be a con man who’d cheat you. That Egypt is also full of a choking bureaucracy is a symptom of the short-termist, theftful nature of the average person there. Whether it’s a private individual who cheats or robs you, or a government worker who cheats or robs you, they both engaged in an act of crossing moral boundaries to commit harm to your person.
Just about any country in the world where people choose peaceful division of labour, specialization, and exchange show people behaving under market actions. Life in Liberia, Mexico, or Pakistan easily reflects the lack of such things even outside the bounds of government.
If human beings went extinct through nuclear war.. would it be a failure of evolution?
Which were not prevented by market action in the defence industry. Hence market failure.
If your farming community is going to be taken over by vikings, it doesn’t matter if your’e anarcho capitalist or state communist. You lose automatically. If they were “free market” farmers, it was a market failure. If they were monarchists, it was a government failure. Everything fails.
Yes. There is a market failure in producing defenses capable of resisting Statism.
Where? Based on the definition that David Friedman gave, and that you accepted, market failure is where individual rationality doesn’t lead to group rationality. What individual rationality led to the group irrationality of letting statism come into existence? Where was the market failure?
Why can’t you just be happy with shallow platitudes?
Quoting Bruce Benson, “David Friedman pointed out to me that there is one serious market failure, however: markets have failed to prevent the concentration of coercive power and the creation of states.”
The notion of market failure involves bad consequences of the workings of the market itself; not the market’s inability to deal with any problem, no matter the source. To call the non-market emergence of government a market failure makes as little sense as saying that a market society unable to divert a doomsday asteroid is an example of market failure.
Correct. There seems to be continued issues with how people want to use the term. Market failure is only systemic failure. An inevitable failure caused by the structure of markets. A meta-concept in relation to the market system.
It does not describe any lack of desired product or service (i.e. AnCapistan instead of the State). That is an entrepreneurial issue. The State is no more a market failure than the lack of flying cars, or asteroid-blasting lasers, or any of the Friedman examples from the other thread.
How is that an answer to my question?
Ferrari hasn’t produced a car that I can afford. Market failure.
I would recommend reading The Rebel’s Dilemma by Mark Lichbach and this article from Peter Leeson.
Why?