Chapter 2, The Role of Government in a Free Society Summary and Analysis

The market permits unanimity without conformity, which is to say that it produces social outcomes that all approve of but where each individual can do as she likes. However, this form of "representation" is not possible in some spheres, such as national defense where you and I cannot consume different amounts. When these goods must be produced, government is necessary to make collective decisions. Since unanimity is often a costly way of making social decision, we settle on majority rule.

We should distinguish individual activities from the framework of law within which those interactions take place. The former are the game-players, the latter are the rulers of the game. However, both sides must accept the rules, but they will disagree on their interpretation and must...