Markets and Wages (2) Fraud Forbidden

The first restriction on free markets is that fraud and deception are forbidden. They are considered to be theft, even if the transaction appeared to be free.

Do not have two differing weights in your bag—one heavy, one light. Do not have two differing measures in your house—one large, one small. You must have accurate and honest weights and measures, so that you may live long in the land the LORD your God is giving you. For the LORD your God detests anyone who does these things, anyone who deals dishonestly (Deut 25:13-16).

This instruction was given in a context where coins were not available for trade. Payments for purchases and sales were made by weighing out gold or silver. A clever way to defraud people was to use scales that weighed light when making payments and a different set of scales that weighed heavy when getting paid.

This type of fraud was an example of what economists call asymmetric information. The person who owned the scales had information that the other did not have. They assumed that they were getting full weight, whereas the person with the scales knew that they were not getting full weight. Even if the exchange occurred freely at an agreed price, the transaction was theft, because the person with the scales was taking something that belong to the other, without getting their permission. Dishonest buying and selling is theft.

The instruction applies to everyone selling goods or services. They must represent the stuff that they are selling accurately. Selling flawed goods as if they are good quality is wrong, because “God detests anyone who deals dishonestly”. This is not a totally free market, where people can take whatever price they can get, even if it is greater than they think the goods are worth. Nor are they entitled to pay the lowest price possible, especially if they think the goods are worth more. Two comments are common in business:

• Let the buyer beware.
• What the market will bear.

They have no place amongst God’s people.

The economic system that system that God gave Moses allows and supports free markets, but this is not freedom without constraint. Trade is free, but it must be honest. Dishonest trade if morally wrong, because it is theft.