I attended a lecture yesterday by Debra Satz, Stanford Professor of Ethics in Society. It was titled “Why Shouldn’t Everything be for Sale?” Satz began by acknowledging that free markets, in general, promote greater efficiency and freedom of exchange than other systems. But markets do a lot more, and there is considerable debate over what limits should exist on markets and their intrusion into certain areas of life. Even many diehard libertarians have qualms about letting the market dictate some transactions, such as those involving child labor, organ trade, surrogate motherhood, life saving medicines, weapons trade, narcotic drugs, or exporting toxic waste to poor nations.

Why do people have these qualms? What moral intuitions might be behind our discomfort in letting the market govern such exchanges? And how might we devise social policy for such markets, knowing that prohibition at times can produce pathological side effects (e.g., banning child labor can increase child prostitution)? In her most recent book, Why some things should not be for sale, Satz tackles such questions. In her lecture, she presented four parameters that can make certain market-based transactions deeply problematic to us:

(a) The weak agency of a party, for instance, due to a significant lack of autonomy or knowledge (e.g., child labor, subprime lending, and organ trade; Satz cited a survey in which 75 percent of the kidney donors in Tamil Nadu—in the so-called “kidney belt”—did not even know how many kidneys they had left).
(b) The vulnerability and inequality of a party (e.g., prostitution, surrogacy, and organ trade).
(c) The likelihood of extreme individual harm to a party (e.g., surrogacy, drugs, and weapons trade).
(d) The likelihood of extreme societal harm (e.g., child labor and weapons trade).

Here is a review of her book that is worth reading:

Debra Satz’s book is a very welcomed addition to the growing engagement of philosophers with questions of morality, ethics and markets. Some of this engagement is well publicised such as Michael Sandel‘s whose BBC’s Reith Lecture on Markets and Morals remains a good introduction to the topic.

Debra Satz does not write to popularize the theme although Why Some Things Should Not Be for Sale is written in a very engaging style, capturing complex arguments in a few crisp paragraphs. The starting point for Satz is that one-dimensional view of markets prevalent in both economics and political philosophy prevents us from appreciating that markets are more than mechanisms for the efficient allocation of resources. Markets can also shape our politics and our civic culture. Particular types of markets – what she terms “noxious markets” – may restrain or subvert the development of desirable human qualities, shape preferences in undesirable ways or promote objectionable social relationships. The contrast with the approach taken by economists such as Alvin Roth to repugnant markets, which takes repugnance as a barrier to the expansion of markets that can be overcome by focusing on trade-offs, should be noted.

More here.