Market, Democracy and "Fair" Liberalism in Frank Knight

Benoît Walraevens ()
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Benoît Walraevens: CREM - Centre de recherche en économie et management - UNICAEN - Université de Caen Normandie - NU - Normandie Université - UR - Université de Rennes - CNRS - Centre National de la Recherche Scientifique, UNICAEN - Université de Caen Normandie - NU - Normandie Université

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Abstract: The paper analyses Knight's singular vision of the market and democracy, as well as the analogy between the two. Knight sought to diagnose the "sickness" of liberalism and to rethink its ethical ideal, developing a "fair liberalism". For Knight, the market and democracy are the two pillars of liberal societies, where preferences and values are formed. However, he makes a clear distinction between their ideal visions and their realities. Ideally, democracy is "government by discussion", a cooperative search for truth and consensus on values. Reality, on the other hand, is marked by "competitive rivalry", where power and inequality are omnipresent, even more so in politics than in economics. Knight uses the metaphor of the "game" to illustrate this dynamic, underlining that the interest in winning can corrupt the game if an ethos of "fair-play" is not maintained. The article explores Knight's influence on Arrow and Rawls. While Arrow highlighted the differences between his approach to social choice and Knight's, Rawls took up elements of Knight, notably his critique of economic inequality for political freedom. Ultimately, Knight's "fair liberalism" emphasizes the need to maintain a level playing field and limit inequalities for the viability of liberal societies, reconciling freedom with justice.

Keywords: Knight; Liberalism; Market; Democracy (search for similar items in EconPapers)
Date: 2025-06-30
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