Robust Political Economy and the Priority of Markets
Author: Mark Pennington
Published in Social Philosophy and Policy, Vol. 34, Issue 1. Summer 2017, pp. 1-24
This essay offers a “nonideal” case for giving institutional priority to markets and private contracting in the basic structure of society. It sets out a “robust political economy” framework to examine how different political economic regime types cope with frictions generated by the epistemic limitations of decision-makers and problems of incentive incompatibility. Focusing on both efficiency arguments and distributive justice concerns the essay suggests that a constitutional structure that prioritizes consensual exchange is more likely to sustain a cooperative venture for mutual advantage.