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March 2018 posts

Ethics without Empathy

By Jonathan B. Wight

Some ant colonies in Africa have developed the division of labor to such an extent that some workers serve as medics to treat other injured ants after foraging raids (see here).

It doesn’t make sense for all ant colonies to save the wounded, if it is cheap for the queen to reproduce new workers. But in some cases injured workers can be rehabilitated and live to fight hard another day, even when missing a limb or two.

Medic ants do triage, providing more care to those that are mildly injured, removing enemy barbs and licking wounds to presumably reduce infections. Seriously wounded ants struggle more and prevent their own removal to the ant hospital—a sort of stoic self-denial of care.

The authors state that: "These results are in line with prior studies concerning rescue behavior and support the hypothesis for the evolution of prosocial behavior without the necessity of empathy or cognition."

Comments on the AEA’s Draft Code of Professional Conduct

 By Jonathan B. Wight

Several weeks ago the American Economic Association issued an ethics report and a Draft Code of Professional conduct.  They asked for public comments.  Here are mine:

 Dear Colleagues,

 There is disconnect between how economists typically model “other” people’s behaviors and how the authors of the Draft Code model the ideal behaviors expected of economists.  The Draft Code of Conduct appeals to deontological ethics, insisting that professionals have a duty to act in certain ways toward others. Good outcomes “demand honesty and transparency in conducting and presenting research, disinterested assessment of ideas, and disclosure of conflicts of interest” (AEA 2018). These duty obligations apply even when web posting or reviewing papers anonymously.

By contrast, the typical economic agent is said to be a selfish maximizer who is opportunistically interested in personal outcomes.  The ethical economist must act quite differently—actions now constrained by duty-bound rules even if they yield an inferior set of outcomes to self.  Duty ethics and outcome ethics approaches can clash.

 Frank Knight, one of the founders of the Chicago School, described the cultural milieu of ideal economics research as being akin to a “religion.” New PhDs must adopt an implicit duty-ethic like a monk adopts the habit of self-denial: “Now scientific enquiry has, and rests upon, a moral code, or in sheer fact a “religion”; and it is supremely important that scientists recognize this fact…. The basic tenet of scientific research—truth or objectivity—is essentially a moral principle, in opposition to any form of self-interest” (1947: 244).

 Amartya Sen likewise notes that moral commitment “drives a wedge between personal choice and personal welfare” (1977: 329). It does not work to try to cram “moral commitment” or duty into a utility function because deontological ethics explicitly repudiates the idea that outcomes could or should determine right action. 

The story gets more complicated.  If economists are expected to do their duties, they must demonstrate self-control (virtuous habits).  Thus, the creators of the Draft Code are also appealing to the development of virtuous character (as discussed in Adam Smith’s Theory of Moral Sentiments and at length by Deirdre McCloskey’s works). Without self-control, obligations and duties are meaningless. The principles set out in the Draft Code are deliberately “parsimonious,” ostensibly because the authors are hoping to rely on the virtues of individuals to translate the vague and incomplete language into habits of character.

To recap, economists use outcome-based modeling (often drawing upon selfish individualism) for predicting the behavior of those in other sectors of the economy.  But in the Draft Code they propose a very different ethical framework for economics researchers, based on duty-based obligations; they also rely on virtue ethics for the development of the character habits of self-control needed to carry out the duties.  Virtue ethics leads to duty ethics, which leads to ethical outcomes.

This framework of ethical pluralism suggests ideas for moving forward. What is called for is not an unenforceable Code, but the active encouragement of dialogue to get economists to understand the complex role of ethics within a market system, including the market for economic research. Instead of modeling people only as outcome-based maximizers, economists need to widen their ethical lenses to explore duty- and virtue-based ethical models. 

I would propose a series of Ethics in Economics workshops (day-long) that could be held before ASSA or during the summer, varying locations around the country.  I have done a number of such workshops, demonstrating how standard economics fits into a wider moral framework. The Templeton Foundation provided over $600,000 for curriculum development and workshops on this topic at the high school level. They (or other funding sources) may be amenable to doing something similar at the university level, especially if given the imprimatur of the AEA.


Knight, Frank. 1947. Freedom and Reform. New York: Harper and Brothers.

Sen, Amartya K. 1977. “Rational Fools: A Critique of the Behavioral Foundations of Economic Theory.” Philosophy and Public Affairs 6(4) Summer: 317–344.


Can Understanding Moral Frameworks Shed Light on the Gun Debate?

By John Morton


Again a school shooting dominates the news.  As a high school teacher for 30 years, I am horrified by these situations.  As in the past, people are shouting at each other rather than trying to find common ground to reduce gun violence in the future.


First, the problem must be defined.  Mass violence is only part of the problem.  In 2017, 762 people were murdered in Chicago, which has the strictest gun-control laws in the nation.  What is even more shocking is that on a per-capita basis, St. Louis has the honor of being the nation’s murder capital followed by Detroit, New Orleans, Cleveland, Newark, and Memphis.  Applying ethical reasoning and economics may help us find ways to reduce gun violence.  This requires some understanding of the three major types of moral frameworks.


Duty-Based Ethics


Duty-based ethics focuses on a set of ethical principles, duties, and rules to guide action.  The Constitution is the rule book for the United States, and what a wonderful rule book it is.  We can amend it, but we ignore it at our peril.  The Second Amendment is still relevant because it allows citizens the ability to protect their other Constitutional rights against government intrusion and to protect themselves against other people.  Just ask the starving Venezuelans.  Confiscating the approximately 300 million guns is a non-starter.  The Second Amendment does not give us the right to bear any arms we wish.  If you need more than six bullets to protect yourself, you’re probably dead.


An even more disturbing idea about abandoning Constitutional rules is the current discussion to ignore due process of law, which is guaranteed by the Fifth and 14th Amendments.  Due process is the key to democracy itself. When President Trump says take guns first and provide due process later, I reach for the hooch bottle.


Virtue-Based Ethics


Virtues are the personal qualities that enable us to do the things good people do.  These virtues include courage, honesty, competence, civility, and concern.  In her February 17 opinion piece in the Wall Street Journal, Peggy Noonan writes that we must improve character and not just look at gun laws.  “A way to look at the question is:  What has happened the past 40 years or so to produce a society so ill at ease with itself, so prone to violence?”  She answers the question:  “Porn proliferated.   Drugs, legal and illegal.  Violent videogames, in which nameless people are eliminated and spattered all over the screen.”


The Academy Awards showed us the people who produce the filth lecturing the country on gun control.  This is hypocrisy at its worst.  Let’s begin now to create a more virtuous society.


Outcomes-Based Ethics


According to outcomes-based ethics, the best action is the best outcome.  For example, are passing more gun-control laws or enforcing the laws we have the better use of government resources?  The Broward County Sheriff’s office was called 39 times about the behavior of shooter Nikolas Cruz.  A call to the FBI’s tipline said Cruz might shoot up a school.  This information wasn’t passed on to the FBI’s Miami bureau.  Cruz listed his occupation on FaceBook as “school shooter.”  An armed guard sat outside the school even as he heard gunshots inside.  Sheriff Scott Israel did everything wrong but went on TV and blamed everyone but himself.  “Ethically challenged” is too kind a description of him.  Are people willing to give up their guns and trust an incompetent government to protect them from violence?


Common-Sense Gun Control


There are many reforms that might reduce gun violence, but the impassioned rhetoric on both sides of the issue virtually guarantees more of the same.  It’s time for people to shut down their self-serving, ethical signaling and work on concrete reforms.



More Barbarity in the Treatment of Adam Smith

By Jonathan B. Wight

Just what we need!  More ludicrous and erroneous teachings about Adam Smith!

Smith favored laissez-faire markets, right?  Wrong!

Smith favored unbridled capitalism led by greed, right?  Wrong.

One person’s profit means another person’s loss, right?  Wrong. 

Unfortunately, The Anspacher Theater in New York is hosting The Low Row, an “epic” play about Adam Smith and his alleged degenerate views.  Here is the flyer:

Smith playNeedless to say, the author is profiting handsomely from putting forth outright lies and fabrications (at least judging from the release above). 

People who love the truth should stay away from this claptrap. 

Trade Wars

By Jonathan B. Wight

“When a country (USA) is losing many billions of dollars on trade with virtually every country it does business with, trade wars are good, and easy to win. Example, when we are down $100 billion with a certain country and they get cute, don’t trade anymore-we win big. It’s easy!”

--President Donald Trump

We should all read Hayek’s “The Pretense of Knowledge,” which is a sharp rebuke to anyone who thinks that making public policy is easy, with knowable and predictable outcomes.

Trump’s tweet on trade suggests a level of bloated bravado, ignorance, and incompetence that is astounding for someone who grew up in New York City and attended elite schools including Wharton.

The tweet is wrong on so many levels it’s hard to know where to start.  Perhaps the biggest issue (to me) is to subsume trade within a narrow accountant’s ledger book.  Two thoughts:

  • One of the main reasons to support trade is because trade promotes other political and social interests. Nixon opened up trade with China not because he thought we could sell them anything (China then was horrendously poor), but because he wanted good relations to help fight the Cold War and the war in Vietnam.  Our previously excellent relations with Mexico and Canada were strengthened when we helped give their economies the chance to sell duty free to the world’s second largest market (after the EU).  Making them richer provides greater border security.  Ditto with Japan and Korea and the EU.
  • The trade deficits that Trump frets about are really capital inflow surpluses! Without the trade deficits we could not have had the trending lower interest rates for past 30 years. The global savings glut has pushed up profits on Wall Street making that sector rich (see Bernanke, here).  So, stopping trade deficits means stopping capital surpluses.  That means pushing us into higher interest rates, a stronger dollar, and none of that is going to help U.S. exporters or U.S. consumers. Quite the contrary.

What kind of strange political logic leads Trump to try to benefit the 140,000 Americans who produce steel at the expense of the 6.5 million Americans who use steel inputs to make other products, not to mention the 327,308,339 American consumers who all use steel in some fashion?  Chances are, it was no logic at all, but a gut reaction. 

From an ethical perspective, harming over 300 million Americans to help 140,000 seems questionable, particularly because these are simply the initial effects of tariffs, and do not take into account the unanticipated side effects of a trade war.