Towards a Political Theory of the Market Economy

Abstract

Abstract Some authors make the dominance of markets responsible for the current crisis of Western democracies. In order to prevent a further development in a post-democratic direction political science has to scrutinize all strategies that aim to establish a predominance of politics including strategies beyond a better market regulation and a further expansion of the welfare state. The paper examines selected contributions to normative political theory in search for models of (1) the democratization of the market economy, (2) the creation of a just economy and (3) the moralization of market economies. Are justifiable models for a democratized economy, a just economy or a moralized market presented in the literature? The distinction between organizations and transactions proves to be important in order to answer the question of how a reconfiguration of the market economy dominated by standards of justice and political equality could look like. Models of internal democratization and self-management have been developed for companies as the organizational part of market economies. In contrast, there is no way to democratize market transactions themselves. With reference to John Rawls and his conception of a property-owning democracy the article analyses the inherent tendency of market transactions to contribute to an accumulation of inequality and the institutional models to limit or to compensate for these side effects of markets.