What Money Can’t Buy: The Moral Limits of Markets

The “crowding-out” effect is an economic anomaly, whereby incentives do not increase supply as would usually be predicted by economic modeling. When commodification or financial incentives are introduced into a situation, intrinsic motivation toward a project or service can be “crowded-out” by market values, which can act as a disincentive. This is illustrated in the case of Israeli high school students, who collected less money for charity when they were paid commissions, as opposed to when they were doing it for purely charitable reasons: The market values “crowded out” their altruistic motivation, making them less engaged in the task.

Free-market values espouse the effectiveness and innate morality of a free market, where buying and selling is endorsed. Free-market values stress the voluntary nature of these exchanges and are opposed to government regulation. Proponents of these values argue that they result in prosperity and the unhindered acquisition of desired goods and services for the individuals who desire them most, as illustrated by the amount they are willing to pay.

Libertarianism is a political ideology that argues it is possible to create a freer and more prosperous society through less (or nonexistent) taxation, free trade, capitalist ventures, and private ownership.