Libertarian Paradise v. Parecon: How do the Two Stack Up?
Yes, of course, but the reason why is of some dispute. I'd argue that most of the benefits would stem from the participatory polity and the liberty enjoyed in that respect, not the economic vision to match. To be more concrete: Let's go through common criticisms of the left and see how this society would address them.
1) Externalities? Yes and no. The federation of the markets, the enhanced decentralization, and the legal system would at least partially address these issues. If someone polluted or harmed their workers, Rothbardian-style courts would be able to enforce sanctions. However, there'd be a few problems. First of all, this is a classic bureaucratic after-the-problem response: because the economy provides incentives to externalize costs on others, the polity must play a catch-up game. Libertarians can't have it both ways: If central planning is faulty, then this solution will suffer for roughly the same reasons. The idea that leftists of my ilk and rightists agree upon is that the economy, if at all possible, should be engineered to do as much as it can, and there should be as little political intervention as possible. This is for both ethical and practical reasons. My fear is that a) these courts could not possibly respond to most problems, solving only the most egregious ones, b) would become horribly clogged, c) would be attacked by the capitalist class, and d) would tend to favor those with money to hire better lawyers. After all, these are the problems we face now, and I see no reason to see that they'd change.
2) Commodity fetishism? No. The incomplete encoding of information within markets wouldn't change even under the most liberalized market. Because all markets are encoded in buyer-seller interactions, even a farmer's market won't adequately communicate the information one would need to buy conscientiously. Those who try to buy with a social conscience regularly notice the problem of not being able to know enough about the commodities they buy.
3) War? Yes and no. People responding to leftist critiques typically say that the economy isn't the sole factor, that resources or market extraction won't singlehandedly determine a war. Their assumption is that the polity is the force making war. While this is true, the polity rarely decides things all on its own: few wars are fought exclusively for personal reasons or because of corrupt states. That's even less plausible than the idea that all wars are fought for economic reasons. Cultural, gender, economic, personal, accidental and political reasons, to name a few, all form wars. Nonetheless, it is simply true that, as much as wars can harm economies, the victor typically gets ample compensation, and wars can also serve as stimuli as well, creating waste production and facilitating complete economic conversion. To say that war's destabilizing effects make it not net beneficial is to ignore the entirety of human history. The liberatory nature of the polity and the decentralization of markets will probably reduce the impetus for war, but I'm afraid that markets will still engender some degree of war unless the polity is globally representative. In that case, war would only be caused by situations where economic actors got enough political clout to gain localized control or were able to develop their own private armies. It is true that corporate actors can themselves wage war, as with the Pinkerton detectives.
4) Inequity? No. Because markets reward output, power and productive property, as well as particular character traits, inequity is simply going to prosper, unless the polity does something, and that's typically excluded out of hand by these advocates. Classism will also continue virtually inevitably; Michael Albert has explained this ad infinitum in his treatments of parecon.
5) Unemployment? Maybe. It is in capitalists' interests and possibly the populations' interests to keep some people unemployed (by unemployed, I mean the standard definition of people who are looking for a job but do not have one).
6) Freedom? Maybe. In Parecon, I think Michael Albert shows that even with group stock ownership schemes and similar, there will be pressures in markets to create coordinator and capitalist classes who seek to enhance their power at the cost of the economy and at the cost of liberty. These coordinator and capitalist classes make the same choice 99% of the time: top-down hierarchical work norms.
7) Adversarial roles of production? Mostly no. Markets are defined by buyers and sellers acting against each other in an adversarial manner, such as haggling in a bazaar.
I think this teaches an important lesson: Just as the best economy could potentially suffer from a totalitarian polity or gender or culture system, the best polity could suffer from a bad economy. What marketeers say is something reasonable: If the economy can accomplish essential jobs, as a practical matter the state should not be involved. But I think this exercise proves that even with the best polity, the capitalist economy is an abject failure. Maybe I'm painting an inaccurate or distorted picture, but I think not.
On a lighter note: My econ class is getting better. Wee!
I'd also like to make a tangential comment: There's a myth of Keynes creating a viable capitalism. Now, I agree Keynesian economic policy makes capitalism more livable, certainly, but Keynes did say that capitalism was a failure of an economic system. It doesn't take much to derive from Keynes an anti-capitalism: admittedly not a Marxist or even anarchist anti-capitalism, but an economists' anti-capitalism.