Friday, March 4, 2022
The Law and Economics Center at the George Mason University Antonin Scalia School of law is hosting a Research Roundtable on Capitalism and the Rule of Law this week in Destin, Florida. My co-author, Professor Jeremy Kidd (Drake University School of Law) and I are honored to present a draft of our current work-in-progress, "Market Failure and Censorship in the Marketplace of Ideas," at tomorrow's (March 5, 2022) session. We look forward to receiving feedback from all the brilliant scholars in attendance. Here's an abstract of the current draft. We look forward to sharing a link to the full draft soon:
As one author notes, the familiar metaphor of the exchange of ideas as a “marketplace” has “permeate[d] the Supreme Court’s first amendment jurisprudence.” If the test for efficiency in the marketplace for goods is wealth maximization, the test for efficiency in the marketplace of ideas has historically been understood in terms of its ability to reliably arrive at truth, or at least the most socially beneficial ideas within the grasp of a community of discourse. And consistent with economic free-market advocates, the received expectation in Western liberal democracies has been that “a process of robust debate, if uninhibited by government [or other] interference, will” best achieve this end. In other words, the assumption is that the market of ideas is most efficient when it is free. As Thomas Jefferson famously claimed, “Truth is the proper and sufficient antagonist to error, and has nothing to fear from conflict, unless by human interposition, disarmed of her natural weapons, free argument and debate.” Similarly, Justice Oliver Wendell Holmes later noted, “the best test of truth is the power of thought to get itself accepted in the competition of the market.”
But even the most fervent economic free-market advocates recognize the possibility of market failure. Market failure is “a market characteristic that prevents the market from maximizing consumer welfare.” The exercise of monopoly power, for example, is a common source of market failure. Most economists agree that government or other regulatory interference with market freedom may be justified to correct a market failure.
The last few years have witnessed increased calls (from both government officials and the private sector) for censorship of speech and research pertaining to a variety of subjects (e.g., climate change; COVID-19 sources and treatments; and viewpoints concerning race, gender, and sexual orientation) across a variety of venues (e.g., social media, the classroom, internet searches, corporations, and even persons’ private bookshelves). The consistent refrain in favor of this censorship is that the spread of false or misleading information is preventing access to or distorting the truth and thereby inhibiting social progress: undermining democracy, fomenting bigotry, costing lives, and even threating the existence of the planet.
Do these increasing calls for censorship respond to a market failure in the marketplace of ideas? For example, could a majority race so dominate the terms of conditions of public and private discourse that minority voices are effectively barred from entry? If so, calls for censorship of expressly or implicitly racially biased voices may be an appropriate response to a market failure in the marketplace of ideas. If not, however, pervasive success at censorship (whether public or private) may itself create inefficiencies equivalent to market failure.
In this Article, the authors draw upon familiar economic principles to explore the possibility of market failure in the marketplace of ideas. The authors then rely on philosophical arguments articulated by liberal thinkers from John Milton and John Stuart Mill to Isaiah Berlin and Richard Rorty to argue (in response to classical and post-modern critiques) that the spread of false or misleading information does not on its own reflect a market failure warranting censorship as a corrective. Instead, it is argued recent successful efforts at silencing and deplatforming dissenting voices (particularly in the context of social media, but also in academia and the workplace) reflects the real market failure in need of correction.
The Article proceeds as follows: Part I offers examples of recent calls for (and efforts at) censorship in the market of ideas concerning a variety of subjects and forums. Part II explores the idea of the marketplace of ideas as an economic concept, defines its components, considers the possibility of associated market failures, and highlights some common fallacies in the application of the concept of market failure more broadly. Part III explores the principal philosophical arguments for the utility of freedom of expression, focusing on the arguments articulated in John Stuart Mill’s classic, On Liberty. Part IV argues that, in light of these arguments (and taking into account contemporary post-modern critiques), the threat of false and misleading expression does not reflect market failure in today’s marketplace of ideas. To the contrary, Part V argues that the ease with which recent public and private efforts at censorship have succeeded itself reflects a market failure warranting correction—if not through legislation or the courts, then by social sanction and the court of public opinion.