what is the argument in dugger theorem: the free market is impossible?

Expert Solution

According to dugger, it is not about the existence of failures in the market; in a capitalist system, the market is controlled by “predatory values” to the detriment of “constructive values”. According to Dugger, the market does not promote well-being; planning and intervention need to exist, i.e., institutions are developed which enable better operation of markets, in the productive and, especially, in the distributive sense.

In this sense, it is important to highlight that market failures, externalities, imperfect competition and information asymmetry are not “residual” aspects of market operation, but constitutive parts of its evolution, i.e., there is no tendency towards short or long-term equilibrium, as advocated by the neoclassical economic theory. These are inherent aspects to the existence of markets, to the extent that they are conditioned both by current institutional arrangements and by economic policies adopted throughout history.

Rahul Sunny answered 1 year ago

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