While Wallace has identified a real tendency in the American and Australian free market movement, it is wrong to call it libertarianism.

So:

Assumption 1): It’s okay to extrapolate the work of Leigh and Putnam to include cultural as well as linguistic variety.

Assumption 2): Market efficiency co-moves with trust.

Assumption 3): Market inefficiency serves only to decrease the market size.

Taking (1) and (2) as given, a town of 10,000 people with cultural homogeneity will have more a efficient market than a town of 10,000 people with lots of different cultures. Adding (3), the culturally homogenous town will also have a larger effective market.

However, we cannot make any definitive comparison of market efficiencies (or effective sizes) between a culturally homogenous town of 10,000 and a culturally heterogenous town of 12,000.

This is where the value of Christine’s comment, even if we accept it, is revealed to be very low.

To make any serious and relevant contribution to the debate, we would need figures on a) how population size combines with market efficiency to produce effective market size; b) how trust affects market efficiency; and c) how cultural diversity affects trust both within and across cultures.

John says: I just realised that I can edit anything on my own site, including other people’s comments. This of course makes sense if I want to remove slander or abuse, but it also lets me change what you said so that it looks like you’re agreeing with me. Now would be the time to insert maniacal laughter.

I have no firm opinion of Christine’s piece because, quite frankly, I haven’t read it (and I don’t intend to). I also agree that Howard is no real libertarian, at least by any definition that I go by.

Without defending it in the least, I was only pointing out that there is a trade-off between multicultural tolerance and perfectly efficient markets. To the extent that, *in Christine’s view of libertarianism*, the latter is more important than the former, she still has an unpalatable point.

Clearly both Andrew and Adam take the opposite view: that true libertarianism must hold greater store by personal freedom (of culture) than efficient markets, though they’re both desirable.

Though many libertarians are fans of markets, I think most would happily paraphrase Franklin in saying those that would trade a little prosperity for a little liberty deserve neither.

And yes, I should not confuse high-tax and heavily-regulated Britain with a ‘perfectly free and efficient market’. But people do have a lot of freedom to buy and sell most commodities.

Don’t make the mistake of conflating “strong economy” with “perfectly free and efficient market”, mind.

In any case, I don’t think the argument attributed to “libertarians” works. Studying at the LSE, you will have noticed that London combines a high level of ethnic diversity and a very open gay community with a strong economy.

Either way, it’s probably (?) safe to guess that Christine didn’t know about their work before writing the article, so her assertion that libertarianism justifies enforced homogeneity does seem contrarian.