If a Pure Market Economy is so Good, Why Doesn't it Exist? The Importance of Changing Preference Versus Incentives in Social Change.

Quarterly Journal of Austrian Economics, 13(2) Summer: 31–52, 2010

22 Pages Posted: 10 Mar 2021

See all articles by Edward Peter Stringham

Edward Peter Stringham

Trinity College; American Institute for Economic Research

Jeffrey Rogers Hummel

affiliation not provided to SSRN

Date Written: Summer 2010

Abstract

Many economists argue that a pure market economy cannot come about because people will always have incentives to use coercion (Cowen and Sutter, 2005; Holcombe, 2004). We maintain that these economists leave out an important factor in social change. Change can come about by altering incentives or preferences, but since most neoclassical economists ignore changing preferences, they too quickly conclude that change is impossible. History shows that social change based on changes in preferences is common. By recognizing that preferences need not be constant, political economists can say much more about changing the world.

Keywords: public opinion, public choice, anarchy, social change

JEL Classification: D78, H11, P11

Suggested Citation

Stringham, Edward Peter and Hummel, Jeffrey Rogers, If a Pure Market Economy is so Good, Why Doesn't it Exist? The Importance of Changing Preference Versus Incentives in Social Change. (Summer 2010). Quarterly Journal of Austrian Economics, 13(2) Summer: 31–52, 2010, Available at SSRN: https://ssrn.com/abstract=2088181

Edward Peter Stringham (Contact Author)

Trinity College ( email )

Hartford, CT 06106
United States

American Institute for Economic Research ( email )

PO Box 1000
Great Barrington, MA 01230
United States

Jeffrey Rogers Hummel

affiliation not provided to SSRN

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