One of the issues that historically debate has generated in the study of economic theory is the market performance (1). This is a topic that polarizes and generates radicalism, and which underlies the search for an answer to why some countries develop economically and others do not. Front this question has set two basic propositions: those who say the state or government should monitor the functioning of the market to regulate prices and the goods or services that are traded there. On the other hand, are those who say the market should operate without any control by the government and are simply the forces of supply and demand will determine the dynamics of market performance. Both positions obviously
made arguments as to why his proposal is valid and that the proposal is located on the other side not. And so, historically, economic analysts have opted for one of two proposals to determine because there is growth and economic development of countries. As noted, both positions are located at odds with economic policy that relates specifically to the dynamics of the state with the market.
From this introductory context, you can then formulate an alternative hypothesis with reference to the Aristotelian assumption about virtue. "Aristotle said that virtuous behavior kept a balance between two extremes that express the opposite: excess and deficiency (2)." In the case of market and state, the ends are given by the proposed regulation by the state total to the market and its antipode, which proposes a zero intervention. In this context, why not speak of an Aristotelian intervention, in which the state is present, but gives a wide discretion to autonomous operation of the market. In other words: a virtuoso performance of the market that do not lean to one of the two extremes.
An argument to support the hypothesis, as in many social science subjects, is the use of simile. The simile is meant as an analogy in which the elements are presented as equal in terms of a quality. In this case, the metaphor we want to do is to market roads and city traffic.
routes would be understood as the government markets designed so that cars (agents of the market, buyers and sellers of goods and services-), can interact there. In addition, an important element in the analysis, is that just as not all people have the ability to have a car and travel on the streets, not all market players may have their own business, so to get around (interacting in market), should appeal to a mass transportation (a company in which to work).
In this context, the point where it can be seen most clearly raised the comparison, is at the traffic lights and traffic signals. These tools are ready to inform, prevent and regulate traffic operation in a city. In normal operation, it is assumed that all people know and respect the signs and traffic lights and organizing these are available to increase the flow and transport efficiency.
In that vein, moving the analysis to the functioning of the market, state intervention means that the State would be responsible for directing and in some cases restrict the way motorists move through the city, virtually telling them where to be handled and where they need to go, with the consequence that, people would have to cycle through their cars where they impose the government regardless of whether willing or able to do so.
The other extreme would be given for the case where there are roads but no regulation and every motorist is free to decide where to go without any indication or restriction. To see the consequences that would follow just looking at a high flow vehicular crossing at the traffic light has been damaged: it is total chaos and each person seeking his own interest does not act as predicted by Adam Smith and his invisible hand theory (3), but increasingly tangled traffic and mobility difficulties.
In the case of market performance, this example would show that a total and unrestricted freedom or indications generates chaos, because the market is far from perfect and may generate losses for some of the agents that move in it. For this reason, the best performance of city traffic, is when motorists have full autonomy and freedom to roam wherever they want in their vehicles, while respecting the laws and signals that the government has arranged to operate in a traffic efficiently and smoothly.
In conclusion, for a properly functioning market is not necessarily think in terms of a dilemma with extreme views, but is not outlandish the idea of \u200b\u200ba balance or compromise between total regulation against absolute freedom market, or in the words of Aristotle, a virtuous action which seeks a balance between these two extremes and, supplemented by a simile raised, would seek to form a signalized market.
-------------------------------- (1) The market can be defined as the space in which buyers and sellers interact to exchange goods and services.
(2) The virtues. Human improvement and happiness. Scale Journal No. 167, June 2003. Mexico.
(3) Adam Smith said that an "invisible hand" guiding the market toward efficiency. Hence his famous statement in The Wealth of Nations: "... is not from the benevolence of the butcher, brewer or baker that we get our dinner, but from his regard for his own interests arising out of our propensity to exchange one thing for another. " The market determines prices and allocates resources and assets efficiently when all the players selfishly defend their interests.
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