Wednesday, February 13, 2008

Expansion on my response to Deneen

I have been thinking about my response, and in light of the comments on my post and his, I wanted to add something.

My argument about Deneen's case being moral, not economic was not quite clear, and this is what I would like to address.

This particular response pretty much sums up the objection:
I had to note, however, after that first distinction that the student is making between "moral concerns" and "economics concerns" that since morality deals with human action and economics is about various types of action, how could economic decisions not be morally considered? To put it another way, is there an entire sphere of actions that are simply non-moral?!

The assumptions of economics, that rational people, aware of the consequences of their actions, make choices in their own self-interest are, in my opinion, sound. These assumptions are then used to project what the outcomes of people's decisions will be. Frequently, these result in the most efficient use of material resources possible.

Economics uses people's preferences to determine how people make choices. It makes no moral judgment about the people's preferences because it is not trying to change them, only determine what the outcome will be, given the preferences people hold.

You can argue that the preferences people hold are immoral, and a case can be made to change those preferences. However, economics is not in the business of changing them, only accepting them to predict the outcomes. This is where the "is" and not "ought" comes in. You can use economic tools to determine the outcome under the counter factual hypothesis of preferences that reflect your moral preferences. Perhaps the outcome is less efficient, as I believe it would be in Deneen's case, but then the question is whether the material costs are worth other benefits, such as decreased alienation, salvation, etc. In short, is the Good worth the loss of goods?

The issue is not with economics, but the libertarian idea that we should not make judgments about people's preferences. That is a moral issue, not an economic one. I hope that clears this up.

1 comment:

Anonymous said...

kid, study your economics and give up the back and forth with Professor D. He's cultivating his bow tie George Will thing (maybe he'll get the tap on the shoulder as the replacement); there is no winning to be had, no persuading to be done here. He has got a tone and style that he seeks to perfect and facts will be crammed in to fit the turn of phrase. This is the way the whole crew rolls. They blurb their books, get the conservative $$ for their journals, and for the most part, write for themselves. Hillsdale College, and then the world!

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