I develop a conception of voluntary exchange and its value that helps us understand the fundamental source of difficulty with voluntary exchange. We can make a great deal of progress in understanding the promise and the perils of voluntary exchange by elaborating an analogy between voluntary exchange and democracy. To be sure, this is a hazardous activity since there are many differences between these areas. But a careful effort here will illuminate the domain of voluntary exchange in both normative and descriptive dimensions. I argue that there is a fundamental tension between the normative principle that applies to voluntary exchange and the basic mechanism by which voluntary exchange operates. The fundamental normative principle, I will argue, is the principle that power over the making of an agreement with another ought to be proportioned among the persons to the interests each person has at stake in the making of the agreement. The fundamental mechanism of voluntary exchange, on the other hand, is that power is inversely proportioned to the stakes someone has in making the agreement. The more interests I have at stake in making an agreement, the more say over the content of the agreement I should have, and, yet, the more my interests hang on an agreement, the less bargaining power I have and so the less say I have in the making of the agreement. Hence, the inherent tendency of voluntary exchange is to work against the realization of the fundamental normative principle that regulates voluntary exchange. Hence, we have a deep and pervasive opposition between fact and norm in the very nature of voluntary exchange. All is not entirely hopeless, however, since there is a unique point where this opposition does not appear and that is in equality in the background conditions of exchange.
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