¹ Tomasi, John, Free Market Fairness (Princeton: Princeton University Press, 2012), 23–24, 60.Google Scholar

² 198 U.S. 45 (1905).

³ Justice Harlan, dissenting in Lochner, defended the maximum hours law by observing that “employers and employees in such establishments were not upon an equal footing, and that the necessities of the latter often compelled them to submit to such exactions as unduly taxed their strength.” 198 U.S. at 69.

⁴ Only elite workers, such as those in higher managerial and professional positions, star athletes, entertainers, academics, and workers represented by labor unions, enjoy significant opportunities to negotiate their contract.

⁵ Bruce, Cf.Scott, R., The Concept of Capitalism (New York: Springer, 2009)Google Scholar, Kindle loc. 291. Scott’s institutional representation of capitalism, stressing the importance of firms and their distinction from the market, and the state’s role in organizing the constitutive rules of firms and markets, exposes the empirical inadequacies of standard ways of framing debates about our economic system.

⁶ Sidney, Algernon, Discourses Concerning Government, ed. West, Thomas (Indianapolis, IN: Liberty Fund, 1698), chap. 1, sec. 5.Google Scholar

⁷ Locke, John, Second Treatise of Government (Indianapolis, IN: Hackett, 1690), sec. 22.Google Scholar

⁸ MacGilvray, Eric, The Invention of Market Freedom (New York: Cambridge University Press, 2011), 28–29.CrossRefGoogle Scholar

⁹ Hill, Christopher, The World Turned Upside Down: Radical Ideas During the English Revolution (New York: Penguin Books, 1991), chap. 3.Google Scholar

¹⁰ Bradstock, Andrew, Radical Religion in Cromwell’s England: A Concise History from the English Civil War to the End of the Commonwealth (New York: I.B. Tauris, 2011).Google Scholar It makes sense, then, that Margaret Fell, one of the founders of the Quaker sect, asserted her masterlessness with respect to her husband and even King Charles II, as Sarah E. Skwire shows in her paper in this volume.

¹¹ Reflecting the hold of republican premises, they excluded “servants” and individuals on the dole from the vote. New Model Army, “Putney Debates,” in Puritanism and Liberty, Being the Army Debates (1647–1649) from the Clarke Manuscripts with Supplementary Documents, ed. Woodhouse, A. S. P. (Chicago: University of Chicago Press, 1957), 53, 82–83.Google Scholar Jacqueline Stevens argues that by the mid–seventeenth century, servants were mostly adolescents and young adults. Hence the Leveller demand, adopted by Locke, amounted to a nearly universal male franchise with a high voting age. “The Reasonableness of Locke’s Majority: Property Rights, Consent, and Resistance in the Second Treatise,” Political Theory 24, no. 3 (1996): 423–63.

¹² MacGilvray, The Invention of Market Freedom, 75.

¹³ Freeholders govern their property by exercising authority to issue orders, backed by sanctions, to others, excluding or limiting others’ use of their property. But they do so without thereby gaining private (personal, arbitrary) dominion over individuals, because their orders are (1) overwhelmingly of omissions (not to trespass), not to specific acts; (2) dispersed and fleeting, rather than concentrated in continuous dominion over specific individuals in a whole domain of life such as work, worship, or family life; and (3) backed by sanctions administered by courts rather than by the owner.

¹⁴ This is why the Levellers were free-traders. See, for example, William Walwyn, “For a Free Trade,” in Works of William Walwyn, vol. 2, James Otteson, The Levellers: Overton, Walwyn and Lilburne (Bristol: Thoemmes Press, 2003), 399–405. Their position does not entail support for capitalist firms. It is about markets, not production. It is targeted against the state-granted privileges of a mercantile system, which are inconsistent with equality under the law and the prospects of men to sustain their independence.

¹⁵ “[I]n respect of riches, no citizen shall ever be wealthy enough to buy another, and none poor enough to be forced to sell himself.” Jean-Jacques Rousseau, The Social Contract, G. D. H. Cole (Amherst, NY: Prometheus Books, 1762), chap. XI, http://www.constitution.org/jjr/socon.htm.

¹⁶ Foner, Eric, Free Soil, Free Labor, Free Men: The Ideology of the Republican Party Before the Civil War, with new introduction (New York: Oxford University Press, 1995)Google Scholar, introductory essay.

¹⁷ See MacGilvray, The Invention of Market Freedom, chaps. 3–4, and Hirschman, Albert, The Passions and the Interests: Political Arguments for Capitalism Before Its Triumph (Princeton, NJ: Princeton University Press, 1977).Google Scholar

¹⁸ Smith, Adam, An Inquiry Into the Nature and Causes of the Wealth of Nations, Vol. 1, Glasgow Edition of the Works and Correspondence (Indianapolis, IN: Liberty Fund, 1776), III.2.8–13.CrossRefGoogle Scholar

¹⁹ Ibid., III.4.4.

²⁰ Which Smith also opposed: Ibid., III.2.6.

²¹ Smith, Adam, An Inquiry Into the Nature and Causes of the Wealth of Nations, Vol. 2, Glasgow Edition of the Works and Correspondence (Indianapolis, IN: Liberty Fund, 1776), V.5.i.e.CrossRefGoogle Scholar

²² Smith, Wealth of Nations, V.1.f.50.

²³ Smith, Wealth of Nations, 1.1.

²⁴ Wilentz, Sean, Chants Democratic: New York City and the Rise of the American Working Class, 1788–1850 (New York: Oxford University Press, 2004).Google Scholar

²⁵ Smith, Wealth of Nations, I.10.2.61.

²⁶ See Tully, James, A Discourse on Property: John Locke and His Adversaries (New York: Cambridge University Press, 1980)CrossRefGoogle Scholar, arguing that it is anachronistic to attribute to Locke support for capitalist employment relations.

²⁷ Coase, R. H., “The Nature of the Firm,” Economica 4, no. 16 (1937): 386–405.CrossRefGoogle Scholar

²⁸ While contracts generally do not specify all their background assumptions, the open-ended nature of the employment contract is particularly prone to abuse because of the continuous, close, hierarchically managed coordination involved, requiring extended personal subordination to particular bosses for a major domain of life. Combined with employment at will in the laissez-faire regime, the open-endedness of the labor contract can and often does lead to employer abuse, particularly for easily replaceable workers at the bottom of the firm hierarchy.

²⁹ See Alchian, Armen and Demsetz, Harold, “Production, Information Costs, and Economic Organization,” American Economic Review 62, no. 5 (1972): 777–95Google Scholar and Williamson, Oliver E., Markets and Hierarchies: Analysis and Antitrust Implications (New York: Free Press, 1975)Google Scholar, chaps. 3–4. Alchian and Demsetz, bewitched by the idea that capitalism is only about markets and not governance, explain the emergence of governance in terms of monitoring costs, but deny that it involves authority relations, because the worker can always quit (ibid., 777–78, 794). This is like saying that Franco was not a dictator because Spaniards were free to emigrate. They claim that the manager’s authority over his workers is identical to the customer’s authority over a grocer: each may “fire,” or withhold business (from the workers and the grocer, respectively), if dissatisfied. But metaphorical “firing” is not real firing: the customer lacks authority to remove the grocer from his position at the store. Similarly, when workers quit, they do not thereby fire or remove their bosses from their positions of authority in the firm. They fire themselves.

³⁰ de Soto, Hernando, The Mystery of Capital: Why Capitalism Triumphs in the West and Fails Everywhere Else (New York: Basic Books, 2000).Google Scholar

³¹ Ibid., chap. 3.

³² Ibid., 55.

³³ Ibid., 181.

³⁴ Dugan Arnett, “Nightmare in Maryville: Teens’ Sexual Encounter Ignites a Firestorm Against Family,” Kansas City Star, 12 October 2013, http://www.kansascity.com/2013/10/12/4549775/nightmare-in-maryville-teens-sexual.html.

³⁵ Neela Banerjee, “Ohio Miners Say They Were Forced to Attend Romney Rally,” Los Angeles Times, 29 August 2012, http://articles.latimes.com/2012/aug/29/news/la-pn-miners-romney-rally-20120829.

³⁶ Eugene Volokh, “Private Employees’ Speech and Political Activity: Statutory Protection Against Employer Retaliation” (2012), http://ssrn.com/abstract=2174776, reports that about half of all Americans lack legal protections against employer retaliation for their political speech.

³⁷ Natasha Singer, “Health Plan Penalty Ends at Penn State,” New York Times, 19 September 2013, B1, http://www.nytimes.com/2013/09/19/business/after-uproar-penn-state-suspends-penalty-fee-in-wellness-plan.html.

³⁸ Linder, Mark and Nygaard, Ingrid, Void Where Prohibited: Rest Breaks and the Right to Urinate on Company Time (Ithaca, NY: ILR Press, 1998).Google Scholar

³⁹ Anderson, Elizabeth, “What is the Point of Equality?” Ethics 109, no. 2 (1999): 287–337.CrossRefGoogle Scholar

⁴⁰ Gaus, “The Egalitarian Species,” in this volume.

⁴¹ Deirdre McCloskey, “Market-Tested Innovation and Supply is Ethical, and has Been Good for Equality,” unpublished manuscript. I sound similar themes in “Ethical Assumptions of Economic Theory: Some Lessons from the History of Credit and Bankruptcy,” Ethical Theory and Moral Practice 7 (2004): 347–60.

⁴² Carson, Kevin, Organization Theory: A Libertarian Perspective (BookSurge Publishing, 2008).Google Scholar I thank Steven Horwitz for alerting me to Carson’s work.

⁴³ I thank Govind Persad for this typology. See also Hirschman, Albert, Exit, Voice, and Loyalty (Cambridge, MA: Harvard University Press, 1970).Google Scholar

⁴⁴ Section III ruled out appeals to property rights, and Section V ruled out appeals to liberty of contract as justifications for workplace hierarchy. Section IV accepted an efficiency case for workplace hierarchy, without conceding that the form of that hierarchy should be dictatorial.

⁴⁵ Manning, Alan, Monopsony in Motion: Imperfect Competition in Labor Markets (Princeton, NJ: Princeton University Press, 2003)Google Scholar, develops models supported by a vast array of evidence that employers exercise market power over workers. This entails that so-called “compensating wage differentials” for bad work conditions always undercompensate. Chapter 8 demonstrates that carefully selected mandated work benefits, including decent work conditions and limited hours, can always increase workers’ well-being, if the benefits are normal goods (demand for which increases with income).

⁴⁶ Samuel Freeman makes a similar point about the affinity of libertarianism with feudalism in “Illiberal Libertarians: Why Libertarianism is Not a Liberal View,” Philosophy and Public Affairs 30, no. 2 (2001): 105–51.

⁴⁷ Bailyn, Bernard, The Ideological Origins of the American Revolution, The Library of American Freedoms (Cambridge, MA: Belknap Press of Harvard University Press, 1967).Google Scholar

⁴⁸ Page, Rebecca, Co-Determination in Germany: A Beginners’ Guide (Düsseldorf: Hans-Böckler-Stiftung, 2009)Google Scholar, explains how the German model works. This model has not had a chance to be tested in the United States, because the Wagner Act requires a strict separation of labor unions from management. The German model has some affinities with Tom Bell’s proposed constitution for municipal governance, which provides for distinct representation of capital investors and residents. See “What Can Corporations Teach Governments About Democratic Equality?” in this volume.