One of Marx's big claims was that market transactions tend to disguise an exploitative relationship based on unequal power between capital and labour:
On leaving this sphere of simple circulation or of exchange of commodities, which furnishes the “Free-trader Vulgaris” with his views and ideas...we can perceive a change in the physiognomy of our dramatis personae. He, who before was the money-owner, now strides in front as capitalist; the possessor of labour-power follows as his labourer. The one with an air of importance, smirking, intent on business; the other, timid and holding back, like one who is bringing his own hide to market and has nothing to expect but — a hiding.
New research shows that Marx was right. Bjorn Bartling and colleagues set up a simple experiment in which a powerful dictator was endowed with artificial wealth which he could transfer to one of two weaker parties. The dictator was given a choice. He could either unilaterally transfer some wealth to one of the other parties, as in a simple dictator game, or he could use an auction in which the two other parties bid for it. After the transfer, the weaker parties were given the option to use some of their artificial wealth to destroy either the dictator's wealth or that of the other weak party.
They found that when the dictator chose competition, the weaker parties were significantly less likely to punish him even if the wealth he transferred was the same as when the dictator chose a unilateral transfer:
A powerful trading party, who could simply dictate the terms of trade, can deflect the blame for unequal outcomes by letting the market decide, i.e., by delegating the determination of the terms of trade to a competitive procedure.
All this is consistent with Marx. Market competition can reconcile people to inequalities which they would otherwise reject.
There's more. In competition, the weaker parties were more likely to punish each other. In this sense, the dictator's choice to use markets acts (unintentionally) as a "divide and rule" strategy. There is, I fear, a direct analogy here with unskilled white workers blaming immigrants rather than capitalists for their unemployment.
We have here, therefore, yet another example of how modern research proves Marx right.
Or do we? These results are also consistent with a McCloskeyan reading - that markets help promote peace and social stability, because they reduce people's inclination to spend resources predating upon others'.
In one sense, the McCloskeyan and Marxian interpretations are similar - both predict that markets reduce discontent.