The Oxford Handbook of Freedom (Oxford Handbooks) by David Schmidtz & Carmen E. Pavel

Author:David Schmidtz & Carmen E. Pavel [Schmidtz, David & Pavel, Carmen E.]
Language: eng
Format: epub
Publisher: Oxford University Press
Published: 2018-02-01T02:00:00+00:00

5. THE CRUCIAL EMPIRICAL ISSUE IN DEBATES ABOUT LIBERTARIANISM

As the discussion thus far shows, whether any kind of market failure argument against libertarianism can be salvaged depends on the empirical question of the extent to which market failure should be expected to occur in situations in which it is predicted by neoclassical assumptions, and to what extent government intervention should actually be expected to make things better rather than worse in those situations beyond the limits of what could reasonably be called a “libertarian” approach to policy. With the empirical nature of this issue in mind, and with some indication now in hand of some of the reasons why government might not generally be the best solution to these problems, we are now in a good position to reflect on the Characteristic Claim of Empirical Libertarianism, which goes well beyond the claims of Default Libertarianism explained above:

Market failures under laissez-faire are generally not as bad as the outcomes that would result over the long run from attempting to solve those failures with greater government intervention. In the rare cases where policy can make things better, the best feasible outcomes are provided by non-intrusive, market-based regulation incorporating Pigovian taxes, cash transfers, and other measures that are the strong default according to Default Libertarianism. In sum, the best overall package of government policies will involve only very modest government interference beyond laissez-faire, where that interference will tend to be highly market-based and decentralized in its implementation.17

This empirical claim is highly controversial but yet not obviously mistaken given contemporary economics, especially in light of the contemporary research outlined above, which will be described in somewhat more detail in subsequent sections. Empirical Libertarianism follows from this empirical claim together with Default Libertarianism, and such a view is similar to Milton Friedman’s consequentialist libertarian view, although now supported by a wider range of empirical arguments.

The important point to make here in connection with this all things considered libertarian view is that if it is false, it is false for complex empirical reasons, and not for obvious reasons that follow from the phenomenon of market failure—contrary to what many political theorists assume. At the same time, it is much more controversial than Default Libertarianism, because it adds the more controversial claim that overriding the default against governmental intervention would very seldom lead to a better outcome over the long run.

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