In the words of Roderick Long, “The first explicit defender of Market Anarchism was the 19th-century economist and social theorist Gustave de Molinari.”
In his 1849 essay, translated as The Production of Security, Molinari made, in the words of Murray Rothbard, “the first presentation anywhere in human history of what is now called ‘anarcho-capitalism’ or ‘free market anarchism.'”
While it is true that there were anarchists before Molinari who were pro-market, such as “William Godwin in England, Josiah Warren in America, and Pierre-Joseph Proudhon in France,” Roderick Long points out that “what Molinari pioneered, in 1849, was an explanation of how market mechanisms could replace the traditional ‘governmental’ function of the State – protection against aggressors…. Thus I don’t see anything properly describable as market-based anarchism (as opposed to merely market-friendly anarchism) prior to Molinari.”
It is worth noting that Molinari’s case against the state’s monopoly on security in The Production of Security is not so much a moral argument as it is an argument of economic efficiency.
As Rothbard writes, “In contrast to all previous individualistic and near-anarchistic thinkers, such as La Boetie, Hodgskin or the young Fichte, Molinari did not base the brunt of his argument on a moral opposition to the State. While an ardent individualist, Molinari grounded his argument on free-market, laissez-faire economics, and proceeded logically to ask the question: If the free market can and should supply all other goods and services, why not also the services of protection?”
In the following excerpt from his essay Molinari describes one of the main advantages of having a market for security (as opposed to a monopoly on security—what most people think of as “governments” today):
[The producers of security’] clientele will naturally be clustered around the center of their activities. They would nevertheless be unable to abuse this situation by dictating to the consumers. In the event of an abusive rise in the price of security, the consumers would always have the option of giving their patronage to a new entrepreneur, or to a neighboring entrepreneur.
This option the consumer retains of being able to buy security wherever he pleases brings about a constant emulation among all the producers, each producer striving to maintain or augment his clientele with the attraction of cheapness or of faster, more complete and better justice.
If, on the contrary, the consumer is not free to buy security wherever he pleases, you forthwith see open up a large profession dedicated to arbitrariness and bad management. Justice becomes slow and costly, the police vexatious, individual liberty is no longer respected, the price of security is abusively inflated and inequitably apportioned, according to the power and influence of this or that class of consumers. The protectors engage in bitter struggles to wrest customers from one another. In a word, all the abuses inherent in monopoly [government] or in communism crop up [see the part of Molinari’s essay titled “Monopoly and Communism” for his definition of these terms].
Read Molinari’s full essay here.
“Market Anarchism is the doctrine that the legislative, adjudicative, and protective functions unjustly and inefficiently monopolised by the coercive State should be entirely turned over to the voluntary, consensual forces of market society.”