Economics and Morality - can they meet?

Australia
November 21, 2008 5:57am CST
‘The recognition that there are problems of political economy that have no technical solution but do have a moral solution goes very much against the grain of modern economic theory. Yet economics began as a branch of moral philosophy, and the ethical content was at least as important as the analytic content up through the writings of Alfred Marshall’. (Herman Daly ‘Steady-State Economics’ p2-3 San Francisco: W H Freeman & Co. 1977) It is interesting, I think, to realise what that quote actually says. Economics began as a moral issue, and it was only the change to mathematical models which took us away from that. Anthropologists and Development Thweorists speak even today of "peasant" economis as "moral" economies, in that their aim is to procide for human needs, not profits or figures in a computer or on a balance sheet. Daly's work is designed specifically to find ways in which we can return to a "moral" economy, but it is so radical by today's standards that to date only the Greens have caught on to it in any significant numbers. What might you understand by the term, "Moral Economy"? Lash
3 people like this
6 responses
@murderistic (2280)
• United States
21 Nov 08
My finance teacher said something interesting, that in finance it doesn't matter if you are doing something wrong or immoral, as long as you're honest about it.
2 people like this
• United States
21 Nov 08
I have to say, that's always been my moral code. And the reason I idolize Teddy Roosevelt to the creepy extent that I do!
1 person likes this
• Australia
22 Nov 08
And if I may wax cynical, it only goes to show how P T Barnum was right - there's a sucker born every minute. I must admit, an honest crook is more palatable, but the astonishing thing is that so many of them get away with warning you that they're going to rob you blind and still getting away with it. Lash
1 person likes this
@sharra1 (6344)
• Australia
13 Dec 08
That is absurd. No wonder the finance industry is in a mess. They are all doing things that breed greed and they are openly greedy. Still the government supports them as they are all mates and the only people who object are not part of the club.
@James72 (26832)
• Australia
21 Nov 08
I am not really convinced that a "moral economy" is even achievable in my opinion. Call me cynical I guess but as per usual it all comes down to each and every politico's own interpretation of what is moral and what is not. You could arguably say that a moral economic approach that places all people as equals and caters to all to ensure quality of life and NOT profits is ideal; but a country's economy is in essence a business just like any other business and figures HAVE to balance otherwise it is unsustainable. A "mainstream" politician would therefore immediately argue that a moral economy is one where the country sustains itself as effectively as possible and their expert team of "smoke and mirror" creators would continue weaving their magic as per usual. Increasing unemployment would be termed as a casualty of war so to speak and explained away; poverty or illiteracy trends etc would also follow a similar fate and so forth. The Greens may have managed to draw attention to certain aspects of its viability but the issue is that they lack mainstream backing for one; and their voices are just not loud enough to be heard effectively enough to even TRY to test the waters on any of these ideals. The frustrating thing about politics is that anything that falls outside of majority held party lines is immediately branded as radical and discounted very rapidly. Political expediency also reigns supreme so where does that leave alternate lines of thought? It's a sad reality I guess.
1 person likes this
• Australia
22 Nov 08
I agree, the realities are sad. But there has been a very influential theory going around in sociology over the past twenty years or so, Ingleghart's Postmaterialism. He believes that in the cultures which have managed to become relatively financially secure, there is a strong generational change toward a more moral political and economic climate. He utilises the Commission of the European Communities longtitudinal study of the changes in values in Europe, a study lasting at the time I read of it from 1971 to the then current year of 1993. This shows a steady, slow changeoveer to the postmaterialist ethic. I suspect that Obama and our own Rudd might be the first two nationally elected leaders who come from the earlier postmaterialist generation. They don't push moral economy, it's true, but both appear to intend to bring honesty and the importance of human over economic interests back into politics; hopefully this will trickle down (lol) into economics. The financial crisis might actually be exactly the key needed to facilitate these changes, since it clearly calls for radical new approaches. Lash
2 people like this
@James72 (26832)
• Australia
22 Nov 08
In relation to your last paragraph; I hope you are right on this one! The whole foundation of government is supposed to be "by the people, FOR the people" yet it seems to have gone in a direction that is very out of touch with people these days. This "new blood" with new attitudes and approaches may just turn the tide in this regard and bring politics back to where it should have always stayed in the first place. As per usual;, time will tell! But again, I do hope you have made an accurate prediction here because something new DOES need to be embraced.
1 person likes this
@NonaSaile (925)
• Philippines
21 Nov 08
The term might then correspond to development economics, addressing issues of equity, which sadly is left out by conventional economic models?
• Philippines
21 Nov 08
Uhm... sorry, but this I do not understand: "...to date only the Greens have caught on to it..." Who are the Greens? A political movement in your country? Sorry for the bother...
• Australia
21 Nov 08
Yes, that is precisely what a moral economy would be. The people who mainly talk about this are those like Vandana Shiva and Ramachandra Guha from India, plus a whole raft of other development writers and anthropologists from both First and Third world universities. As for the Greens, they are the environmental movement that has major political effect in Australia, New Zealand, Germany, Britain, and a whole host of other European countries. I think Canada has a reltively active Green party, but the US has managed to keep its version fairly well under the radar - these ideas are particularly unwelcome in the States. Lash
2 people like this
• Philippines
21 Nov 08
Thanks for the info about the Greens. The concept of moral economy is still "so radical by today's standards"... Sighing. You are right.
@egdcltd (5838)
21 Nov 08
I read in a science fiction book by E.E."Doc" Smith about a concept called "Enlightened Self Interest". Essentially, whilst a company would want to make as much profit as possible, and shareholders as muchg return on their investment as possible, and workers as high a wage as possible, there's a point where all get the maximum amount of benefit without being detrimental to anything or anyone else.
@egdcltd (5838)
22 Nov 08
Selfish capitalism is pretty self destructive. Only doing stuff solely for profit and analysing everything as a cost tends to actually reduce the profits in the log term - which can mean more than a year. I read an article this week saying that companies should be careful where they are cutting costs in the current climate, and be sure not to just lay off people who actually deal with the customers. Reducing the cost of customer service tends to reduce the quality too, which can then mean that customers go elsewhere.
@sharra1 (6344)
• Australia
21 Nov 08
I encountered the term moral economy when I was studying history and it was about having prices for the poor that were reasonable. The markets would open for the poor first and the prices would be set to a level they could afford. The poor were known and were protected from rising prices in this way. Then when they had bought what they needed the prices were set at market level and everyone else got to shop. I thought that was a wonderful situation and it would be good if we had special prices for people who are poor. For those who think it is too hard, it is not as the government in Australia for example issues a special card to all low income earners and one to pensioners which give them discounts in many areas such as fares, medicines, rates etc but not in the case of food or goods. It would be wonderful it it could be extended to these areas.
• Australia
22 Nov 08
Yes, that is an extension of moral economy. In the terms in which I understand the concept, this quote explains it best. [b]‘Lying behind the ‘live and let live’ formula is the principle of ‘moral economy’. In contrast to the economics of competition and growth, this means that every human being is allowed access to the necessary requirements for production so that they can maintain themselves in existence. All members of society feel an obligation to conduct their economic affairs in such a way that others also are able to survive, drawing assurance from the knowledge that their own basis of existence will always be safe. Social behaviour is thus determined not by competition but by reciprocity’.[/b] [Bennholdt-Thompson & Mies 1999:87] I see no practical reason why this sort of regime cannot successfully exist in our current situation. Lash
1 person likes this
@sharra1 (6344)
• Australia
22 Nov 08
I believe it could but it would take a change in attitude away from our current individual greed society towards a more caring society. I wonder if we can achieve that, or are people just too greedy.
@sktekweb (277)
• India
21 Nov 08
Moral Economics is mixing economics with morality.Economics actually began as a moral issue so to say moral problem.Human beings were very happy when the jungle sufficed them food and shelter.The day the ECONOMIC SYSTEM was introduced,we followed behind notes,currencies to count,not how many fruits etc.Greed came with the idea of "not enough" even with a Bank Balance of thousands millions.Our Economic system,for the sake of peace and morality,needs reorientation.