Commutative Theory of Justice

Commutative justice deals centrally with fairness in the exchange of goods and fair participation for buyers and sellers in the system of exchanging goods for payment. Theories of commutative justice articulate the content, processes, social relationships, antecedents, consequences, and boundaries of systems that provide buyers and sellers with fair participation in the exchanges of goods for payment.

Justice is the attribute of being fair to what is properly merited by facts, reasons, and principles. Commutation describes systems of exchange the economy is a commutative system in which goods are exchanged for payment in a marketplace of buyers and sellers. There is much debate, however, about the content of commutative systems that deserve to be labeled as just. Sellers with significant market power over buyers, for example, may set prices at a level that creates substantial profit but locks out some deserving buyers. One such case is in some segments of the pharmaceuticals industry, where sellers still retain the power to set drug prices but may set them at a level that poor people cannot afford the therapies they need. The counterargument in this debate notes that high prices attract additional sellers and reinvestment so that over time more buyers will be able to participate. In this view, the marketplace adjusts in a dynamic process that is as fair and just as possible.

Some argue that the justice of the buyer-seller exchange can be determined only by the subjective judgment of each participating individual. In this view, free markets based on voluntary exchange are the most just because there is no coercive interference with the individual's subjective perception of what is fair and properly merited by facts, reasons, and principles. This perspective is most notable in the theories of Austrian economics. Seminal thinkers in this tradition include Carl Menger, Ludwig von Mises, and Friedrich Hayek.

Free markets of individuals sometimes are criticized for failing to adequately supply critical social resources such as education, transportation, communication and computing services, nutrition, health care, child care, and clothing. Importantly, each person's ability to access these social resources is likely to enable or hinder their capability to participate as a buyer or seller in the marketplace. Access to these social resources, therefore, is likely to be a significant antecedent of commutative justice, and commutative justice is likely to decrease as the distribution of such resources becomes increasingly narrow. This view emphasizes the sociological and public policy processes that are likely to influence commutative justice. Egalitarianism, utilitarianism, and socialism are normative philosophies often applied by social scientists in this tradition of commutative justice.

It is difficult to develop a positivist science of normative commutative justice consisting of lawful theoretical relationships that can be reliably observed and empirically falsified. This is because justice is an intangible principle of philosophy that is difficult to measure; and each observer's subjectivity and individual normative preferences regarding the definition of justice make reliable and standard measurement very difficult if not impossible. These obstacles to our theoretical understanding may be overcome, in part, by a descriptive approach to commutative justice that focuses on tangible measures of market participation.

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