A social contractarian theory of markets: Neoclassicism, Rawls, Gauthier and the alternative
The study of resource allocation in market venues is taken up in a comparative framework of neoclassical and various social contractarian theories. It is shown that economic theory does not have an explanation of substantive interactions among agents and variables as it does among society, economy and institutions, all of which social contractarian theory necessitates. Thus Rawls's and Gauthier's social contractarian theories are examined against neoclassicism and the classical theory of markets and resource allocation. Shortcomings with these theories are pointed out and a purely interactive theory of social contractarianism is propounded. Markets and resource allocation are once again studied in this framework.