Lindblom - The Market System - Afghan Journalists' Committee

258 Thinking About Choicesprice setter for many goods and services. It sets minimumprices on some farm products in order to bolster farm income.It sets maximum prices on electric power in order tocurb monopoly. It uses tariffs to set high enough prices onan import to protect domestic producers of it. Price settingis sometimes part of the state’s regulatory role, sometimespart of its supportive role, and sometimes a part of its redistributiverole. As a multipurpose price setter, the state becomesa constant participant in markets, just as it does inits role as buyer and seller. Both roles make the state an insiderrather than a force from outside the market system.In this second model, the collective purposes pursued bythe state are no less valuable than those pursued by individualparticipants in the market system. In fact, they are usuallythe same purposes. One of the reasons people who canafford to do so buy houses in the suburbs is that they wantsome of the amenities that more congested urban life doesnot give them. Or they want an immediate environment ofgreen rather than of buildings and paved surfaces. Or theywant quiet rather than noise. These purposes are also thepurposes of collective choice in the hands of the state:amenities and environment, among others. Because in somecircumstances they can be pursued effectively only throughcompulsion—public education requiring, for example, thecompulsion of taxes—state compulsion is an accepted elementin the model.I prefer the second model and also find it more realistic.Whether you do or do not, there is an implication in it thatgreatly helps clarify our choices.Market System as State Administrative InstrumentBy implication in the second model—and in reality too—the market system is the major administrative instrument