Which criteria or principles should we use when regulating markets? Economists have an answer to this question: it is called the ‘theory of market failure’. This theory lists some general reasons when markets fail on their own, and need regulation. I am interested in a philosophical analysis of these economic reasons. My general approach is to take them seriously, but give them a more political twist. The result is a theory of market failure. which can do justice to a broader range of reasons for regulating markets, beyond efficiency-based arguments which are central to the economic theory of market failure.  

My general approach to this issue is defined in [10, 14]. In [10] I link the theory of market failure to the idea of autonomous agency (see also under the theme ‘Freedom, Autonomy and Liberalism). In [13], I link market failure to the capability approach (see also the theme ‘The Capability Approach’).  

Four traditional economic reasons for regulation are cases of:  

• Externalities. This I discuss in [11] where I discuss the affinity of externality analyses with the liberal ‘harm principle’ and show how both need to be complemented with a theory of basic interests.  
• Public goods. This I discuss in [6], where I take on the question how to legitimize packages of public goods which are of differential benefit to individual citizens. A Dutch application to the particular question of publicly financing the arts is [3].  

• Imperfect competition. I discuss one particular aspect of this, namely, the question how to balance competition with initiatives between firms for cooperation to promote sustainability in production, in [[12, 14], with Dutch spin-offs in [7, 9]. 
• Moral hazards. This I discuss in [8, 15]. The earlier one is set in the context of the 2008 financial crisis. The later article revisits and revises the earlier one, arguing that ethical analysis is needed to determine the extent to which people can be held responsible for posing a moral hazard to others.     

Finally, I discussed ethical/philosophical aspects of the 2008 financial crisis, and our policy responses to it, in Dutch articles [1, 2, 4, 5].  

Publications for ‘Market Regulation: Theories of Market Failure’ 

[1] ‘Voorbij de reguleringsreflex’, Socialisme & Democratie 65 (12)(2008): 17-22. PDF.

[2] ‘Van morele vrijstelling naar morele vergunning. Pleidooi voor een publieke ethiek voor de financiële sector’, Socialisme & Democratie 66 (12)(2009): 49-59. PDF.

[3] ‘Kunstsubsidies: een oefening in tegendenken’, Socialisme & Democratie 67 (12) (2010): 20-27. PDF. 

[4] ‘Privaat denken, publiek denken. Over de toewijzing van verantwoordelijkheid voor de financiële crisis’, in: Eelke de Jong (ed.). Wat zegt de crisis over onze moraal? (Nijmegen: Valkhof Pers, 2011), 54-73. WEB/PDF. 

[5] ‘Er bestaat geen recht op kapitaal’, in: De Groene Amsterdammer 137 (33), 15 augustus 2013, pp. 30-33. WEB.  

[6] ‘Public Goods, Mutual Benefits, and Majority Rule’, in: Journal of Social Philosophy 44(3)(2013): 270-290. DOI/PDF.  

[7] ‘Concurreren of samenwerken? Over bedrijfsethiek en de grenzen van het mededingingsrecht’, in: Filosofie & Praktijk 35 (4)(2014): 19-33. 

[8] ‘Financial Crisis and the Ethics of Moral Hazard’, in: Social Theory and Practice 41 (3) (2015): 527-551. DOI/PDF. 

[9] ‘Bredere kijk op mededingingsrecht gewenst’, met Anna Gerbrandy, in: www.mejudice.nl, 25 februari 2015. WEB/PDF.

[10] ‘Justice in Regulation: Towards a Liberal Account’, in: Jay Drydyk & Krushil Watene (eds), Theorizing Justice: Critical Insights and Future Directions (London: Rowman & Littlefield, 2016), 153-172. WEB/PDF.   

[11] ‘Externalities as a Basis for Regulation: A Philosophical View’, in: Journal of Institutional Economics 12(3)(2016): 541-563. DOI/PDF.

[12] ‘Rethinking European Competition Law: From a Consumer Welfare to a Capability Approach’, co-authored with Anna Gerbrandy, in: Utrecht Law Review 12(1)(2016): 1-15.  DOI/PDF.

[13] ‘A Capability Framework for Financial Market Regulation’, in: Lisa Herzog (ed.), Just Financial Markets? Finance in a Just Society (Oxford: Oxford University Press, 2017), 56-77. DOI/WEB.   

[14] ‘Doing good together. Competition Law and the Political Legitimacy of Interfirm Cooperation’, co-authored with Anna Gerbrandy, in: Business Ethics Quarterly 28 (4)(2018): 401-425. Winner of the Society for Business Ethics (SBE)’s Annual Prize for the best article in BEQ. DOI/PDF. 

[15] ‘The Ethics of Moral Hazard Revisited’, in: Norbert Gaillard, Juan Flores, Rick Michalek (eds). Moral Hazard (London: Routledge, 2021).