Is the Free Market a Metaphor?

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David Frum: We have to look at how the market, ina sense, becomes a set of institutions that understand collective properties. He says we tend to toss out our information processing tasks to broader structures. Those can be political institutions and bureaucracies, he says. There are a wide variety of different things that we can do here,. But the crucial point then is that we have to pay attention to these collective modes of problem solving.

Democracy posits the radical idea that political power and legitimacy should ultimately be found in all of the people, rather than a small group of experts or for that matter arbitrarily-chosen hereditary dynasties. Nevertheless, a good case can be made that the bottom-up and experimental nature of democracy actually makes for better problem-solving in the political arena than other systems. Political theorist Henry Farrell (in collaboration with statistician Cosma Shalizi) has made exactly that case. We discuss the general idea of solving social problems, and compare different kinds of macro-institutions — markets, hierarchies, and democracies — to ask whether democracies aren’t merely politically just, but also an efficient way of generating good ideas.

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Henry Farrell received his Ph.D. in Government from Georgetown University. He is currently the Stavros Niarchos Foundation Agora Institute Professor of International Affairs at the Johns Hopkins School of Advanced International Studies. He was the 2019 recipient of the Friedrich Schiedel Prize for Politics & Technology. He is a member of the Council on Foreign Relations and co-leader of the Moral Economy of Technology initiative at Stanford University. He is a co-founder of Crooked Timber blog, as well as the Monkey Cage blog at the Washington Post.

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