Lindblom - The Market System - Afghan Journalists' Committee

Alternative Market Systems 257still negative in coloration, like “regulation.” The modelconceives of the state as a discordant element, at best apartly successful tinkerer, at worst a disrupter. Market participantsconsist of individual persons. The state is not aparticipant but a regulator, thus an influence from “outside”the market system and on that account to be regardedwith suspicion. Insofar as the state tries to satisfy collectiveneeds neglected by market purchases, it is inefficient. For itpursues such purposes as social amenities and environmentalprotection, which are of less value than marketed goodsand services. It also often compels citizens who, the modelpostulates, should be free.Among models alternative to this one, I choose a particularone not to advocate it—though its superiority to thefirst model will strike most readers as obvious—but to illuminateby contrast. In this second model, the state, a deeplyimperfect institution, establishes, as in the first model, thelegal foundations of the market system. But its support ofthe market system goes much further. That support—notinterference or regulation but support—is constant andwide ranging. It includes the management of money andcredit, subsidies and tax concessions, research and development,and opening up and protecting overseas markets,among many other aids. The state also plays a regulatoryrole, as in the first model; but that role is no more frequentor strong than the supportive role. The state is also a redistributorof income and wealth.On top of these state roles in the second model are twoother roles overlooked in the first model. The state is a marketparticipant as buyer and seller. What is more, it is thelargest buyer and seller in the system, buying the services ofteachers, researchers, and highway contractors, as well asfarm products, computers, and trucks. The state is also a