James M. Buchanan's contractarianism and modern liberalism

[Conclusion] Hayek has been rightly praised for his most important role in the modern revival of classical liberalism. I want to submit, though, that a truly 'modern' liberalism must fill a void in the classical liberal tradition that Hayek only started to address, namely to complement the well-developed liberal theory of the market by a consistent liberal theory of democracy. As I have argued above, to have shown how this void may be filled is the specific contribution of James Buchanan to a modern liberalism. It is not the least important feature of his contractarian-constitutionalist approach that it draws attention to the fact that markets and politics are both to be judged in terms of their capacity to allow the individuals involved to realize mutual gains, and that - in contrasting market and democracy - we must keep in mind that there is neither a 'market as such' nor a 'democracy as such.' Both, markets and democracies exist only as arenas for social cooperation that are framed by specific 'rules of the game' and their working properties will be critically dependent on the nature of these rules. Accordingly, liberals who care about how the prospects for individuals to realize mutual gains, in the market arena as well as in politics, might be improved, should focus their research ambitions on comparing specific institutional alternatives for how social cooperation may be organized in both these realms.