Friday, December 16, 2011

Why Your Boss Cannot Coerce You in a Free Market

I have often heard opponents of free markets argue that, like government, which is necessarily coercive, that free markets are coercive as well. They point to things like bosses firing employees as being an example of this. But is a boss firing -- or threatening to fire -- an employee truly coercive?

In a free market, "if you do something good for me, I will do something good for you." In government, which, as noted, is necessarily coercive, "unless you do something good for me, I will do something bad to you." This is the very nature of policing and the military. It is the very nature of taxation.

And what of the boss threatening to fire an employee. Well, that is a case of "If you cease to do something good for me, I will cease to do something good for you." This is NOT the same as "unless you do something good for me, I'll do something bad to you." People think they are the same, and thus free markets are coercive, but they are not. Those are completely different kinds of relationships.

Threatening to end a relationship is not the same as using threats to keep you in one.
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