Speech, truth, and the free market for ideas

Legal Theory

Volumn 2, Issue 1, 1996, Pages 1-32

  Goldman, Alvin I ^a   Cox, James C ^a  

^a UNIVERSITY OF ARIZONA   (United States)

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[No Author keywords available]

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EID: 84963613481     PISSN: 13523252     EISSN: 14698048     Source Type: Journal    
DOI: 10.1017/S1352325200000343     Document Type: Article

References (37)

1. See F. A. Hayek, INMMDUAUSM AND ECONOMIC ORDER (1948), 85-86. Hayek emphasizes, however, that the price system of the market provides only limited information to each participant, only the information he or she needs to be able to take the right course of action, not information (for example) about the factors that have caused changes in prices.
2. Here, we have in mind the “unraveling result,” in which sellers arc impelled (in equilibrium) to reveal accurate information about their product, because, if they remain silent, buyers will infer it is worse than it is. See D. G. Baird, R. II. Gcrtncr, and R. C. Picker, GAME THEORY AND THE LAW (1994), 89-109. The unraveling result applies, however, only in very special circumstances, namely, where information can be verified once it is disclosed, and where lying is sanctionable. It is doubtful how far these special circumstances generalize. For discussion of these kinds of issues, see subsections IV.C and IV.G below.
3. See D. C. Mueller, PUBLIC CHOICE (1979).
4. J. Milton, AREOPACITICA, A SPEECH FOR THE LIBERTY OF UNIJCENSED PRINTING (10-14, H. B. Cotterill ed. 1959); J. S. Mill, On Liberty, in ON LIBERTY, REPRESENTATIVE GOVERNMENT, THE SUBJECTION OF WOMEN (1859/1960).
5. Justice Holmes (dissenting), Abrams v. United States, 250 U.S. 616 (1919), at 630.
6. FREE SPEECH: A PHILOSOPHICAJ. ENQUIRY (1982), Ch. 2.
7. Since the quote appears in the chapter entitled “The Argument from Truth,” it is evident that by “best” ideas, Schauer means trtie (or, perhaps, “truest”) ideas.
8. Of course, the truth rationale might be weakened somewhat so that it docs not assign truth preeminence among values. We shall not explore this issue, however, since our concern is with the factual premise of the argument from truth.
9. Actually, (MMTP0) speaks of the market being unregulated; but this is contrasted with situations in which speech is regulated, with the implication that speech is unregulated in a market system.
10. The first, formula given here is due to W. Alston, A REALIST CONCEPTION OF TRUTH (1996). For similar defenses of realist, or correspondence, theories of truth, see also M. David, CORRESPONDENCE AND DISQUOTATION (1994), F. Schmitt, TRUTH (1994), and A. Goldman. KNOWLEDGE IN A SOCLM. WORLD, Ch. 2 (in preparation).
11. See Goldman, A REALIST CONCEPTION OF TRUTH note 14, for further discussion. To register differences in interest or importance, the representation of the social aggregate of truth possession might weight more heavily each agent's true beliefs in propositions that interest him more. Tins approach might help address the worry expressed by Larry A. Alexander about the variable importance individuals attach to information. See Alexander, Trouble on Track Tim: Incidental Regulations of Speech and Free Speech Theory, HASTINGS L.J. 44 (1993): 939-941.
12. The example is cine to T. Scanlon, Content Regulation Reconsidered, in DEMOCRACVANOTHE MASS MEDIA (J. Lichtenbcrg cd. 1990).
13. Baker, Scope of the First Amendment Freedom of Speech, UCLA L. REV. 25 (1978): 974.
14. Ingber, The Marketplace of Ideas: A legitimizing Myth\ DUKE L.J. 84 (1984): 25.
15. Baker, The Marketplace of Ideas: A legitimizing Myth\ DUKE L.J note 20, at 976.
16. See Z. Kunda, The Case for Motivated Reasoning. PSVCHOLOCICAL BULLETIN 108 (1990): 480-498, and A. Goldman, Psychological, Social, and Epistemic Factors in the Theory of Science, in PSA 1994, VOL. 2 (M. Forbes ed. 1995).
17. O. M. Fiss, Wliy the Stalé, HARV. L. REV. 100 (1987): 781, and Slate Activism and Stale Censorship, YALE L. J. 100 (1991): 2087; C. R. Sunstein, Free Speech AW. U. Cmc. L. REV. 59 (1992): 255, and DEMOCRACY AND THE PROBLEM OF FREE SPEECH (1993).
18. Fiss, State Activitm and Stale Censorship, at 2100.
19. Fiss, H7i_y the Stale?, State Activitm and Stale Censorship note 2-1, at 786. The final phrase originates with Justice Brennan, in New York Times v. Sullivan, 376 U.S. 254 (1964) at 270.
20. The state is suspect, of course, on two types of grounds: (1) it is not (always) a disinterested party, and (2) it may not he a wholly competent truth-oriented regulator. This need not imply, of course, that state regulation never promotes truth acquisition or error avoidance. In fact, we shall present ostensihle cases of this sort in section III. Rut, as we shall indicate, most of these cases are open to debate.
21. DEMOCRACY AND THE PROBLEM OF FREE SPEECH, The state is suspect, of course, on two types of grounds note 24, at 34.
22. D. A. Farbcr, Free Sjeech Without Romance: Public Choice and the First Amendment, I IARV. L. REV. 103 (1991): 554-583.
23. A. Director, The Parity of the Economic Market Place, THE JOURNAL OF LMVAND ECONOMICS 7 (1964): 1-10; R. Coase, Hie Market for Goods and the Market for Ideas, AMERICAN ECONOMIC REV. 64 (1974): 384-391.
24. P. Milgrom and J. Roberts, Relying on the Information of Interested Parties, RAND JOURNAL OF ECONOMICS 17 (1986):*18-32.
25. R. A. Posner, Free Seech in an Economic Penfcctive, SUFFOLK U. L, REV. 20 (1986), 1-54, p. 7.
26. It is noteworthy, in this connection, that erratum notices in physics journals do not appear to be very effective in avoiding error propagation from an initially published mistake. See M. Tliomscn and D. Resnik, The Effectweness of the Erratum in Awiding Error Pivfwgation in Physics, SCIENCE AND ENGINEERING ETHICS 1 (1995): 231-240.
27. See A. Goldman, Epistemic Paternalism: Communication Control in IMW and Society, THE JOURNAL OF PHILOSOPHY 88 (1991): 113-131; reprinted in A. Goldman, LIAISONS: PHILOSOPHY MEETS THE COGNITIVE AND SOCIAI. SCIENCES (1992).
28. FEDERAL RULES OF KVIDENCE FOR UNITED STATES COURTS AND MAGISTRATES (1989), Rule 102.
29. FED. R. EVID., Rule 403.
30. The point of this paragraph is in the neighborhood of a point made by Alexander, Tumble on Track Tivo: Incidental Regulations of Speech and Fire Speech Theory, at 93C>-939. Alexander points out that purchasers of information typically agree to a price for an item (or IMMIV) of information before receiving the information, i.e., before they know what it will be. Our point is not only that purchasers of information do not know beforehand what messages they will receive from a source, but also that once they receive a message they still may be unable to assess its truth value correctly. They won't necessarily know whether or not it is an instance of the product-type: true speech.
31. G. Akcrlof, The Market for “Ismons”: Quality Uncertainly and the Market Mechanism, QUARTERLY JOURNAL OF ECONOMICS 84 (1970): 488-500.
32. For the definition of “bid price,” see J. W. Pratt, Risk Aivrsion in the Small and in the ECONOMETRICS 32 (19G4): 122-130.
33. See C. R. Ploit, IZxtenwlities and Omective Policies in fojierimental Markets, ECONOMIC JOURNAL 93 (1983): 106-127, and R. Franciosi, R. M. Isaac, D. E. Pingry. and S. S. Reynolds, An Exfuritnental Investigation of the Hahn-Noll Revenue Neutral Auction for Emissions Licenses, JOURNAL OF ENVIRONMENTAL ECONOMICS AND MANAGEMENT 24 (1993): 1-24.
34. R. H. Coase, Vie Problem of Social Cost, THE JOURNAL OF LAW AND ECONOMICS 3 (1960): 1-44.
35. See P. A. Samuelson, The Pure Theory of Public Expenditure, REVIEW OF ECONOMICS AND STATISTICS 36 (1954): 387-389.
36. For a general treatment of public goods, see J. O. Ledyard, Public Goods: A Sunvy of Experimental Research, in THE HANDBOOK OF EXPERIMENTAL ECONOMICS (J. Kagel and A. Roth, eds. 1995).
37. Farber, Free Speech xinthout Romance: Public Choice and the First Amendment, supranolc 31