8 - Soft complicity II: Reinforcing injurious socioeconomic structures

Summary

The market does not operate in a vacuum. It is governed by formal and informal rules. It is undergirded by a web of institutions painstakingly built up over time. Because of the dynamism and fluidity of the marketplace, its underlying structures are marked by both continuity and change, shaped by the economic choices of market participants. Thus, a fourth instance of economic complicity pertains to the harmful or unjust market practices and institutions that market participants unavoidably perpetuate and reinforce, but unfortunately leave uncorrected.

OBJECT OF ACCOUNTABILITY (COMPLICITY IN WHAT?)

In the preceding chapter, we saw that leaving grievous pecuniary externalities unattended is common in market exchange. Left on its own, the market will not mitigate its severe unintended consequences, and people are simply left to fend for themselves. This is the norm in the modern market economy. After all, such pecuniary externalities are the mechanisms that compel people to redeploy their resources in line with the economy's allocative efficiency. In this chapter, we extend the analysis and consider harmful unintended consequences that are non-pecuniary in nature.

In economics, recall that externalities are unintended consequences the costs of which are not included in the price calculations of economic agents. Technical externalities (e.g., pollution) are the best known of these. The preceding chapter was about pecuniary externalities (e.g., price and income changes).