Ethics and Economics - a start
September 21, 2009
I had something ready to remark on when I got a chance and in the meantime started reading papers today for my class, Competition, Cooperation and Choice. A statement appeared in a paper by a very good student: "From the economic point of view [doing x] does not make any sense but still people do it all the time." My strong sense is that if people do x (at least if many people do x or if one person repeatedly does x) doing x makes sense. So economists may wish to think about how we teach our students to compartmentalize. Instead of telling them to put aside economics and think about how to explain the decision, can we teach our students that economic actors are a much richer set of individuals than we have acknowledged at least since the latter half of the 20th century?
Jonathan wrote that economic actors have ethical beliefs. Economists sometimes acknowledge beliefs but haven't given adequate consideration to their motivational force. If beliefs and ethical presuppositions motivate, then an economics that takes those into account may make a great deal of sense. This makes for a sort of Smithian analysis, the Smith of both TMS and WoN (the Smith without Das Adam Smith Problem) and it's what we hope to talk more about here.
Thanks, Sandra - I agree with you in general, especially the point that agents make decisions and choices for reasons, even if those reasons fall outside the boundaries of what is commonly regarded as "economic," which doesn't make them any less valid. But I think some compartmentalization is still useful, if we understand "economic" reasons to refer to your typical, self-interested, material preferences, and "noneconomic" reasons would include ones based on altruism, sympathy, principle, etc. - reasons that would restrain the "economic" ones. But neither type of reason is more valid--therein lies the problem, to my mind.
Consider the implicit normative judgment among many that "economic" reasons are more valid than "noneconomic" ones. I often read in various forums, after every election, "why did voters favor him when he's going to raise their taxes [or lower their benefits]?" Any other reason to vote for or against a candidate--such as foreign policy, abortion, same sex marriage, judicial appointments--are judged "irrational." Why are economic considerations "privileged" in such contexts, when in others, making decisions solely on the basis on financial gain or loss is commonly seen as selfish?
Posted by: Mark D. White | September 22, 2009 at 12:16 PM