2015년 4월 3일 금요일

[발췌: 아마티아 센, 자유로서의 발전] Chap 5. Markets, State and Social Opportunity

출처: Amartya Sen. Development as Freedom. Alfred A. Knopf, 1999.

※ 발췌 (excerpts): pp. 112 ~ ..

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Chapter 5_ Markets, State and Social Opportunity

"It is the customary fate of new truths," says T.H. Huxley in ^Science and Culture,^ "to begin as heresies and to end as superstitions." Something very like this seems to have happened about the truth of the importance of markets in economic life. There was a time─not very long ago─when very young economist "knew" in what respect the market systems had serious limitations: all the textbooks repeated the same list of "defects." The intellectual rejection of the market mechanism often led to radical proposals for altogether different methods of organizing the world (sometimes involving a powerful bureaucracy and unimagined fiscal burdens), without serious examination of the possibility that the proposed alternatives might involve even bigger failures than the markets were expected to produce. There was, often enough, rather little interest in the new and additional problems that the alternative arrangements may create.

  The intellectual climate has changed quite dramatically over the last few decades, and the tables are now turned. The virtues of the market mechanism are now standardly assumed to be so pervasive that qualification seem unimportant. Any pointer to the defects of the market mechanism appears to be, in the present mood, strangely old-fashioned and contrary to contemporary culture (like playing an old 78 rpm record with music from the 1920s). One set of prejudices has given way to another─opposite─set of preconceptions. Yesterday's inexamined faith has become today's heresy, and yesterday's heresy is now the new superstition.

  The need for critical scrutiny of standard preconceptions and political-economic attitudes has never been stronger.[n.1]  Today's prejudices (in favor of the pure market mechanism) certainly need to be carefully investigated and , I would argue, partly rejected. But we have to avoid resurrecting yesterday's follies that refused to see the merits of─indeed even the inescapable need for─markets. We have to scrutinize and decide what parts make sense in the respective perspectives. My illustrious countryman Gautama Buddha may have been too predisposed to see the universal need or "the middle path" (though he did not get around to discussing the market mechanism in particular), but there is something to be learned from his speeches on nonextremism delivered 2,500 years ago.

5.1  Markets, Liberty and Labor  (p. 112)

Even though the merits of the market mechanism are now very widely acknowledged, the ^reasons^ for wanting markets are often not fully appreciated. This issue was discussed in the introduction and in the first chapter of this book, but I must return to it briefly in examining the institutional aspects of development. In recent discussions, the focus in assessing the market mechanism has tended to be on the ^results^ it ultimately generates, such as the incomes or the utilities yielded by the markets. This is not a negligible issue, and I shall come to it presently. But the more immediate case for the freedom of market transaction lies in the basic importance of that freedom itself. We have good reasons to buy and sell, to exchange, and to seek lives that can flourish on the basis of transactions. To deny that freedom in general would be in itself a major failing of a society. This fundamental recognition is prior to any theorem we may or may not be able to prove (on which more presently) in showing what the culmination outcomes of markets are in terms of incomes, utilities, and so on. [n.2] 

  The ubiquitous role of transactions in modern living is often overlooked precisely because we take them for granted. There is an analogy here with the rather underrecognized─and often unnoticed─role of certain behavioral rules (such as basic business ethics) in developed capitalist economies (with attention being focused only on aberration when they occur). But when these values are not yet developed, their general presence or absence can make a crucial difference. In the analysis of development, the role of elementary business ethics this has to be moved out of its obscure presence to a manifest recognition. Similarly, the absence of the freedom to transact can be a major issue in itself in many contexts. [n.3]

  This is, of course, particularly so when the freedom of labor markets is denied by laws, regulations or convention. Even though African American slaves in the pre-Civil War South may have had pecuniary incomes as large as (or even larger than) those of wage laborers elsewhere and may even have lived longer than the urban workers in the North,[n.4] there was still a fundamental deprivation in the fact of slavery itself (no matter what incomes or utilities it might or might nor have generated). The loss of freedom in the absence of employment choice and in the tyrannical form of work can itself be a major deprivation.

  The development of free markets in general and of free seeking of employment in particular is a much appreciated fact in historical studies. Even that great critic of capitalism Karl Marx saw the emergence of freedom of employment as momentous progress (as was discussed in chapter 1). But this issue concerns not just history but the present as well, since this freedom is critically important right now in many parts of the world. Let me illustrate this point with four quite different examples.

  First, various forms of labor bondage can be found in many countries in Asia and Africa, and there are persistent denials of basic freedom to seek wage employment away from one's traditional bosses. ( ... ... )

  Second, (to turn now to a very different illustration), the failure of bureaucratic socialism in Eastern Europe and the Soviet Union cannot be fully grasped merely in terms of the economic problems in generating incomes or other results, such as life expectancies. ( ... ... )

  In assessing what happend, the economic inefficiency of the communist system must, of course, be recognized. But there is also the more immediate issue of the denial of freedom in a system where markets were simply ruled out in many fields. Also, people could be disallowed from using the market even when they existed. For example, they could be barred from seeking employment in an ongoing recruitment process (including some unfavored persons being sent to work where the bosses wanted them to work). In this sense, Friedrich Hayek's chastising description of the communist economies as "the road to serfdom" was indeed a fitting, if severe, rhetoric. [n.6]  In a different─but not unrelated─context, Michal Kalecki (the great Polish economist who returned to Poland with great enthusiasm as the communist rule got established there) noted, in answer to a journalist's question on Poland's progress from capitalism to socialism: "Yes, we have successfully abolished capitalism; all we have to to now is to abolish feudalism."

  Third, as was noted in chapter 1, in the distressing subject of child labor (as prevalent, for example, in Pakistan, or India, or Bangladesh), there is an embedded issue of slavery and bondage, since many of the children working in exacting tasks are forced to perform them. ( ... ... )

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  Fourth, the freedom of women to seek employment outside the family is a major issue in many third world countries. This freedom is systematically denied in many cultures, and this in itself is a serious violation of women's liberty and gender equity. ( ... ... )

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5.2  Markets and Efficiency  (p. 116)

The labor market can be a liberator in many different contexts, and the basic freedom of transaction can be of central importance, quite aside from whatever the market mechanism may or may not achieve in terms of income or utilities or other results. But it is important also to examine those consequential results, and I turn now to that─rather different─issue.

  In assessing the market mechanism, it is important to take note of the forms of the markets: whether they are competitive or monopolistic (or otherwise uncompetitive), whether some markets may be missing (in ways that are not easily remediable) and so on. Also, the nature of factual circumstances (such as the availability or absence of particular kinds of information, the presence or absence of economies of scale) many influence the actual possibilities and impose real limitations on what can be achieved through various institutional forms of the market mechanism. [n.10]

  In the absence of such imperfections (including the nonmarketability of some goods and services), classical models of general equilibrium have been used to demonstrate the merits of the market mechanism in achieving economic efficiency. This is standardly defined in terms of what economists call "Pareto optimality": a situation in which utility (or welfare) of no one can be raised without reducing the utility (or welfare) of someone else. This efficiency achievement─the so-called Arrow-Debreu theorem ( ... [n.11])─is of real importance despite the simplifying assumptions. [n.12]

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  It is possible, however, to question whether the efficiency sought should not be accounted in terms of ^individual freedoms^, rather than ^utilities^. ( ... ) I have, in fact, demonstrated elsewhere that in terms of some plausible characterizations of substantive individual freedoms, an important part of the Arrow-Debreu efficiency result readily translates from the "space" of utilities to that of individual freedoms, both in terms of freedom to choose ^commodity baskets^ and in terms of ^capabilities to function^.[n.14]  ( ... ... )

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  ( ... ... ) Thus, if it were really necessary to assume universal selfishness to establish the efficiency results in the Arrow-Debreu model, then it could be seen as a serious limitation of that approach. However, this limitation can be substantially avoided by examining the demands of efficiency in terms of individual freedoms, rather than just utilities.

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5.3  Coupling of Disadvantages and Inequality of Freedoms  (p. 119)

5.4  Market and Interest Groups  (p. 120)

5.5  Need for Critical Scrutiny of the Role of Markets  (p. 123)

Indeed, critical public discussion is an inescapably important requirement of good public policy since the appropriate role and reach of markets cannot be predetermined on the basis of some grand, general formula─or some all-encompassing attitude─either in favor of placing everything under the market, or of defying everything to the market. Even Adam Smith, while firmly advocating the use of markets where it could work well (and denying the merits of any ^general^ rejection of trade and exchange), did not hesitate to investigate economic circumstances in which particular restrictions may be sensibly proposed, or economic fields in which nonmarket institutions would be badly needed to supplement what the markets can do. [n.24]

  It must not be presumed that Smith's critique of the market mechanism was always gentle, or, for that matter, that he got his critical points invariably right. Consider, for example, his advocacy of legal restrictions on usury. [n.25]  Smith was, of course, opposed to any kind of general ban on charging interest on loans (as some antimarket thinkers had advocated). [n.26]  However, he wanted to have legal restrictions imposed by the state on the maximum rate of interest that could be charged:

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5.6  Need for a Many-Sided Approach  (p. 126)

5.7  Interdependence and Public Goods  (p. 127)

5.8  Public Provisioning and Incentives  (p. 129)

5.9  Incentives, Capabilities and Functionings  (p. 131)

5.10  Targeting and Means-Testing  (p. 134)

5.11  Agency and Informational Basis  (p. 137)

5.12  Financial Prudence and Need for Integration  (p. 138)

5.13  Concluding Remarks  (p. 142)

( ... ... )

  Even though different commentators have chose to focus on particular institutions (such as the market, or the democratic systems, or the media, or the public distribution system), we have to view them together, to be able to see what they can or cannot do in combination with other institutions. It is in this integrated perspective that the different institutions can be reasonably assessed and examined.

  The market mechanism, which arouses passion in favor as well as against, is a basic arrangement through which people can interact with each other and undertake mutually advantageous activities. In this light, it is very hard indeed to see how any reasonable critic could be against the market mechanism, as such. The problems that arise spring typically from other sources─not from the existence of markets per se─and include such concerns as inadequate preparedness to make use of market transactions, unconstrained concealment of information or unregulated use of activities that allow the powerful to capitalize on their asymmetrical advantage. These have to be dealt with not by suppressing the markets, but by allowing them to function better and with great fairness, and with adequate supplementation. The overall achievements of the market are deeply contingent on political and social arrangements.

  The market mechanism has achieved great success under those conditions in which the opportunities offered by them could be reasonably shared. In making this possible, the provision of basic education, the presence of elementary medical facilities, the availability of resources (such as land) that can be crucial to some economic activities (such as agriculture) call for appropriate public policies (involving schooling, health care, land reform and so on). Even when the need for "economic reform" in favor of allowing more room for markets is paramount, these nonmarket facilities require careful and determined public actions.

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  ( ... ... ) p. 145.

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