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Markets and Democracy: Complementarities and Conflicts

Introduction to the Special Issue “Markets and Democracy: Complementarities and Conflicts”

Alexandre Chirat, Nathanaël Colin-Jager, Cyril Hédoin et Camila Orozco Espinel
p. 167-172

Texte intégral

1This special issue of Œconomia is devoted to the theme Markets and Democracy: Complementarities and Conflicts.” It is based on the theme “Market(s) and Democracy” of the 7th International Conference of Economic Philosophy, held in Reims in May 2024. For the past seven editions, the conference has brought together contributions from subfields at the intersection of economics and philosophy—particularly economic philosophy and the history of economic thought.

  • 1 This point was famously advanced by Fukuyama (1992) but reiterated since by Acemoglu and Robinson ( (...)

2The choice of the theme “Market(s) and Democracy” arose because these two institutions are, at least in contemporary Western societies, the most salient collective decision-making procedures. Historically, liberal democracies have emerged as a dominant model, holding together markets and democracy. Since the 19th century, markets have been the primary mechanism for allocating resources among members of society. Democracy, as a general form of political regime, is the main procedure for allocating political power, public goods, and ultimately choosing public policies. Their functional division of labour, designed to foster economic and political openness, competition, and accountability, is often portrayed as a defining characteristic of open societies.1 Therefore, markets and democracies have often been thought as going hand in hand, in liberal democratic regimes. However, this simple and general view of the importance and institutional complementarity of markets and democracy conceals many interesting complexities.

  • 2 This concern has been well-established in the Republican tradition since Rousseau ([1755] 1985) and (...)
  • 3 This symmetric concern is explicit in Mises ([1927] 2005), Hayek (1944; 1960), Buchanan and Tullock (...)
  • 4 See Sandel (1996), Putnam (2000), and more recently Fraser (2022). For the debate on the moral limi (...)
  • 5 The theme of a civilizing market is already defended in Montesquieu ([1748] 1989). For more recent (...)

3A long-enduring concern has been that far from being complements, markets and democracy are actually in conflict, up to the point that the development of a market-based economy is likely to undermine democratic institutions;2 or, conversely, that democratic institutions interfere with the functioning of market mechanisms.3 As the contributions will show, this concern has taken several forms and has been pushed in different directions. Many social scientists have entertained the idea that the development of markets has weakened traditional norms, but also the civic and political values that sustain any genuine or healthy democracy.4 This view of the relationship between markets and democracy is in striking contrast with more optimistic accounts that single out their complementarity as part of the “inclusive institutions” that favour economic development.5 Hence, the relation between markets and democracy is complex, and depends on the virtue given to markets and the conception of democracy mobilized (e.g., competitive, aggregative or deliberative).

4The topic of the relationship between the market and democracy was explored from a wide range of perspectives during the Reims Conference, reflecting the diversity of approaches at the intersection of economics and philosophy. Among the sixteen contributions initially received, we have chosen to publish four articles, all of which explicitly address, from the perspective of the history of economic and political ideas, the complementarities and antagonisms between market-based and democratic processes in 20th-century capitalist societies.

5The contributions by Noé Kirch (Université Lyon 2) and Marine Raffray (Université Reims Champagne-Ardenne) address this question through the lens of John Dewey’s pragmatist philosophy, considering both its content and its influence on the implementation of economic policies in the United States. These first two contributions focus primarily on the issue of consistency between democratic and economic institutions at the national level. By contrast, emphasizing the supranational dimension of economic activities within the capitalist system, the contributions by Lukas Starchl (Karl-Franzens-Universität Graz) and Tiago Mendonça dos Santos (Universidade do Vale do Itajaí, Florianópolis) share a common focus on addressing the conflicts between global markets and national democracies.

6Kirch highlights the complementarity between Dewey’s political philosophy and his positions on the organization of economic life in favour of establishing an “industrial democracy.” The article challenges the “separatist interpretation,” which holds that John Dewey’s epistemological and methodological philosophy can be detached from his economic positions of the 1930s—particularly his support for public control of industry and commerce. In opposing the critiques of Kenneth Arrow, Richard Posner, and D. Wade Hands, the article demonstrates that these positions are a coherent extension of Dewey’s social and democratic philosophy, grounded in the idea of an “industrial democracy” and the collective control of the consequences of economic activity. This direct link between democracy and economic organization resonates with the theme “Markets and Democracy”, affirming that democratic values must extend into the economic sphere in order to be preserved, and that the market must be governed by forms of participation and public control.

7Raffray, for her part, focuses on a historically pivotal event in American history: the implementation of the New Deal. She notably shows how the influence of Dewey’s pragmatist philosophy, combined with institutional economic analysis and the involvement of its representatives (particularly Rexford Tugwell) in the New Deal, shaped both the goals and the implementation of the Agricultural Adjustment Act (AAA). The intellectual context was one in which American democracy appeared threatened by the economic crisis caused by market dysfunctions, making national economic planning seem the solution to many. Raffray focuses on the networks of institutional economists who directly advised Roosevelt and staffed the US Department of Agriculture and the Agricultural Adjustment Administration. By placing agricultural planning at the heart of her contribution, Raffray contributes to the theme “Markets and Democracy” by showing how the AAA represented a “methodological turning point” in the decision-making process, relying not only on academics as close advisors but also on commissions representing farmers and consumers. Inspired by Dewey’s conception of democracy, the actors of the AAA sought to strike a balance between the economic efficiency of planning, which may require a significant degree of centralization and expertise, and a democratic dimension, which involves the active participation of stakeholders in decision-making.

8Starchl analyses the evolution of Ludwig Mises’s thought on supranational governance based on his Viennese writings and archives, showing how his initial confidence in “popular enlightenment” and democracy as a means to achieve harmony of interests gradually eroded in the face of nationalist tensions and anti-capitalist movements. The study demonstrates that, for Mises, the market is fundamentally a global phenomenon requiring strong supranational institutions, but that its institutional framework becomes increasingly centralized as it moves away from participatory democracy. By exploring the tension between liberal global capitalism and democratic forms of governance, as well as Mises’s shift toward a “de-democratized” conception of the global market, this contribution fits within the challenge raised by the theme “Markets and Democracy”.

9Mendonça dos Santos contributes to the issue “Markets and Democracy” by investigating the tension between the market and democracy through a critical reconstruction of the controversy between German philosophers Jürgen Habermas and Wolfgang Streeck during the 2010s. This debate begins with the recognition of a dual crisis (economic and political) of neoliberal capitalism, particularly in the context of the European Union. While Habermas proposes a “upward” solution to this dual crisis, advocating for transnational democratization to moderate the dominance of technocratic decision-making within international institutions, Streeck argues for a “downward” solution, calling for a kind of return to sovereign national economic policies to recover the broken link between capitalism and democracy. By carefully tracing the main arguments and normative foundations of both authors, Mendonça dos Santos makes clear how many solutions of institutional refoundation, proposed to counter the democratic backsliding fuelled by successive economic crises, can unfortunately appear very utopian.

10We are confident that these contributions will enrich the debate from a history of economics and philosophy of economics perspective, and we hope the readers will enjoy these pieces as much as we did.

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Bibliographie

Acemoglu, Daron and James A. Robinson. 2012. Why Nations Fail: The Origins of Power, Prosperity and Poverty. London: Profile.

Anderson, Elizabeth. 1993. Value in Ethics and Economics. Cambridge: Harvard University Press.

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Fraser, Nancy. 2022. Cannibal Capitalism: How Our System Is Devouring Democracy, Care, and the Planet—And What We Can Do about It. New York: Verso.

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Notes

1 This point was famously advanced by Fukuyama (1992) but reiterated since by Acemoglu and Robinson (2012). It is also a defining feature of the classical liberal view; see, for instance, Hayek (1944), Popper (1945), or Friedman (1962).

2 This concern has been well-established in the Republican tradition since Rousseau ([1755] 1985) and Smith ([1776] 1904), and extends to Mill (1848). Schumpeter (1942), Polanyi (1944), Lindblom (1977), and Dahl (1985) developed this critique. More recently, many authors, most notably Streeck (2014), have pointed towards the inherent tension between neoliberal capitalism and democratic control, among others.

3 This symmetric concern is explicit in Mises ([1927] 2005), Hayek (1944; 1960), Buchanan and Tullock (1962), Buchanan (1975), Narveson (1988), Caplan (2007), and Brennan (2016), among others.

4 See Sandel (1996), Putnam (2000), and more recently Fraser (2022). For the debate on the moral limits of the market and the critique of the extension of the market logic and the erosion of moral norms, see Anderson (1993), Satz (2010), and Sandel (2012).

5 The theme of a civilizing market is already defended in Montesquieu ([1748] 1989). For more recent defence of this view, see North (1990), or McCloskey (2006; 2010).

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Alexandre Chirat, Nathanaël Colin-Jager, Cyril Hédoin et Camila Orozco Espinel, « Introduction to the Special Issue “Markets and Democracy: Complementarities and Conflicts” »Œconomia, 15-2 | 2025, 167-172.

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Alexandre Chirat, Nathanaël Colin-Jager, Cyril Hédoin et Camila Orozco Espinel, « Introduction to the Special Issue “Markets and Democracy: Complementarities and Conflicts” »Œconomia [En ligne], 15-2 | 2025, mis en ligne le 01 juin 2025, consulté le 10 février 2026. URL : http://journals.openedition.org/oeconomia/18742 ; DOI : https://doi.org/10.4000/15cal

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Auteurs

Alexandre Chirat

Université Marie et Louis Pasteur, CRESE, Besançon, France. chirat.alexandre@gmail.com

 

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Nathanaël Colin-Jager

Université Catholique de Lille, ESPOL. n.colin-jaeger@univ-catholille.fr

 

Cyril Hédoin

Université Reims Champagne Ardenne, CRIEG-REGARDS. cyril.hedoin@univ-reims.fr

 

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Camila Orozco Espinel

Université Reims Champagne Ardenne, CRIEG-REGARDS. camila.orozco-espinel@univ-reims.fr

 

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