In reading Is the Market Moral? (Brookings Institution Press, 2003), I have come across a passage containing what I suspect is a common misconception about markets.

"Unlike the market, which values people according to their resources and the productivity they bring to the market, Christian teachings on poverty ascribe value to a group that has no resources."

The problematic premise implicit in this statement is that ‘the market’ somehow bestows value and that the value it bestows is somehow absolute. But the ‘market’ is not a willful being; the market is a term for the free association of willful beings, namely persons. In the market — a particular sphere of human interaction — the involved persons do recognize certain types of value in other persons based on what those persons offer in that sphere. But recognition (or lack of it) of a person’s ‘value’ in a given sphere is not an absolute value judgment. The ontological value of the human person is inherent. But ‘market value’ is not the same as ‘ontological value’. The confusion comes with the word value: same word; different concepts.

Such confusion seems to be the hallmark of those who denounce the market for being ‘out-of-step’ with the mandates of the Christian faith. Perhaps a parallel will help to explain the problem: It would be silly to suggest that a hockey coach who cut from his team a boy who could not skate was somehow ignoring the boy’s value as a person. While it is true that the coach denies the boy’s value in the sphere of the game of hockey — that is, he has little value as a hockey player — the boy’s ‘absolute value’ does not depend on his ‘hockey value’. Likewise, to say a given person has less opportunity in a market because he has less to offer in capital is not to say that the market devalues that person in an ontological sense; a person’s ontological value does not depend on his market value.

I think the tendency to equate market judgment with ontological judgment is simply the residue of materialist Marxism, an ideology that claims reality — and thus real worth — is only to be found in material. While it sounds compassionate to denounce the market as an institution that ‘devalues’ those whom Christianity values, the truth of such denouncements is that they stem from semantic confusion (or trickery) and lead to actions down the road that deny true value.

Click here for suggested readings on human dignity and here for an extensive list of works that deal with value.

  • Tim

    Nice distinction. People (read: liberals) often forget that the market is not the only sphere of importance.

  • David Pendleton

    Phelps is absolutely right about the misconceptions held by so many liberals who are critical of the marketplace. Economic value is best determined in an atmosphere of free market participants who can undertake voluntary exchanges based on their resources and needs as they perceive it. But these values economically determined are not the whole of the story. Economic value is only part of the picture. Liberals would be less critical of free markets if they understood this basic fundamental belief of conservatives. Liberals cannot do so because they have ruled out any discussion of beings being endowed by their Creator with inalienable rights and invested by God with a value that cannot be quantified. Rights in their view are conferred by the Government. Hence there is no need for the proposition of God.

  • http://blog.acton.org/index.html?/archives/336-Theres-Poverty-and-then-theres-Poverty.html Acton Institute PowerBlog

    As I have mentioned before, we must be extremely careful about our language when we debate one another on any issue. So often, an argument is won, lost, or irredeemably confused because of a definition. If truths can be unlocked in careful definition, so

  • http://blog.acton.org/index.html?/archives/492-Submerged-Subsidiarity.html Acton Institute PowerBlog

    Because too much has already been said about the recent gulf hurricanes, I won’t put in my two cents. I will, however, direct the reader to the most insightful take on this situation that I have yet to stumble across. As you read it, think again a