Rawls followed hume in thinking that the rules of property and contract were institutional rules – social practices involving rules of conduct justified as a system, assuming general compliance (Hume 1978 [1738]). Rawls thus describes markets as one of the “major social institutions” that comprise the “basic structure of society” (TJ 6, 48).There are good reasons for having markets, but they are reasons that justify our collective choice of this institutional system. The market is not simply the consequence of interaction within the scope of individuals’ natural moral rights, as argued by libertarians.

It might seem natural to suppose that the market is justified by the idea that people’s relationships should be based on free agreement (PL 265); I shouldn’t have to buy your product or sell you my labor unless we both agree to the transaction. This principle presupposes an account of the circumstances under which a transaction will count as genuinely voluntary, and fairly arrived at. While the necessary conditions may be in place at time 1, the accumulated results of many agreements may alter people’s opportunities so that later the conditions for free and fair agreement are absent. It is impossible to forestall this possibility by putting additional requirements on individual transactions because the effects of any one agreement on “background justice” (PL 266) will normally make up only a small part of a long-term process. The institutions that make up the basic structure of society must therefore be designed to maintain the social conditions necessary for free and fair agreement to be possible. For example, without a social minimum (the responsibility of the “transfer branch”; TJ 244), some people might ind themselves in situations in which they had no choice but to accept dangerous or degrading work. Only with the necessary background institutions in place can we say that the results of agreements are fair no matter what they are, as per the idea of “pure procedural justice” (TJ 243, 73–78).