Lindblom - The Market System - Afghan Journalists' Committee

12Too Little,Too LateSuppose there were no spillovers, no compulsory terminations,no monopoly, no price fixing, no ignorance and irrationalityin choice, and no motivational failures. Could themarket system then achieve a high degree of allocative efficiency?One might think so, but the answer is no—unless,of course, efficiency is simply redefined to make the answercome out yes. There remains a barrier to efficiency, for themarket system can operate only within a limited domain.Many efficient allocations consequently lie beyond its capacity.The principal limitation on its domain, we alreadyknow, is that it can coordinate only those allocations thatare voluntary. Market participants can obtain objects andperformances only through offers of benefits, with bothbuyer and seller acting voluntarily. The market systemcan coordinate the construction of a skyscraper or the coordinationof 10,000 workers to provide financial servicesto investors. But it cannot coordinate—purchases cannotachieve—the acquisition of land for a highway. At leastsome owners must be compelled to surrender. Nor can it accomplisha planned transfer of money income or wealthfrom one group to another. Nor the education of childrenwhose parents cannot afford to pay for it. It cannot do theseand many other things efficiently because it cannot dothem at all.To get them done, the market system often requires helpfrom the state—for example, taxation in order to redistrib-