capitalism

V
VIRTUE
The term virtue is often used equivocally in both scholarly
and ordinary discourse. The term is sometimes employed
to mean whatever is morally good or appropriate.
However, it has traditionally been used more precisely
to mean certain qualities of character, or dispositions to
choose actions, that are essential to living the right kind of
life. As Aristotle defined it in the Nicomachean Ethics,
virtue “is a settled disposition toward actions by deliberate
choice.” According to Aristotle and those who have
followed him, one acquires virtues by engaging in virtuous
acts: “A man becomes just by doing just actions and
temperate by doing temperate actions; and no one can
have the remotest chance of becoming good without doing
them.” He ridicules those who, “instead of doing virtuous
acts, resort to merely talking about them and think that
they are philosophizing and that by doing that they will
become virtuous.”
If one uses the term to refer to certain dispositions of a
person’s character that both produce and express moral
excellence, which is the traditional meaning of virtue and
the one used here, then there is no easy or direct connection
between libertarianism and virtue, either theoretically or
particularly. With respect to libertarian political theory, the
idea of using the state to directly promote virtuous conduct
would violate its central principles. Practically speaking,
the pluralism embedded in libertarianism would appear to
leave no room for using force to promote the “right kind of
life” or the “right sort of character,” although libertarians
have no problem with individuals or groups achieving or
promoting those things through voluntary means, such as
education, persuasion, and example.
There is a general tension in classical liberalism
between the concern with procedural rights, which specify
limits, constraints, and procedures rather than goals or
ends, and the traditionally nonprocedural and substantively
specified characteristics of virtue found in much of traditional
moral theory. Indeed, a central element of classical
liberal theories of social order is the observation that individuals
can interact for mutual benefit without any real
knowledge or concern about each others’ characters.
Although virtue and liberty are not directly linked, a
number of connections between the two may nonetheless
be identified. Libertarianism implies free and open markets,
and it has been a common view, at least since Adam
Smith, that such markets promote certain widely appreciated
virtues, such as honesty, thrift, civility, probity, temperance,
tolerance, and prudence. Having to please others
in order to be successful in the market, rather than being
able to use force to accumulate wealth, provides a certain
discipline that engenders the habits just mentioned.
Free-market competition among providers of goods and
services tends to reward those who exhibit such traits and
to encourage others to emulate them. But can free-market
competition emerge if such virtues are absent? In recent
years, there has been substantial interest in the issue of
whether markets are dependent on preexisting moral dispositions.
The question has become especially acute since
the fall of the Soviet empire because markets in a number
of formerly communist countries have had difficulty taking
root, although no state appears to have been systematically
and deliberately preventing them from doing so. The
issues and problems are complex, and their study offers
many opportunities for advancing our knowledge of how
self-ordering systems emerge and sustain themselves. It
may be that the rule of law and well-defined property
rights are more central to the development of markets than
is any given set of moral dispositions. At the same time,
the establishment of the rule of law and well-defined property
rights may be dependent in some important way on
moral beliefs and attitudes. It is not obvious which must
precede the other.
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