Can we revisit the issue I call “actors and roles” as it relates to normative propositions in the artfully fabricated world of the ethical half-theory of neoclassical welfare economics, the Fairy Land of Economic Theory, versus reality? It’s a fun issue.
I usually discuss this issue in the context of ethics of economic power as it relates to resolving interpersonal conflicts of preferences in markets. In the ethical half-theory of neoclassical welfare economics, economists as such are meant to not express opinions on such ethics. Of course, a running joke in economics is that bad economists in the conservative style do exactly that, all the time. Indeed, one supposes occupying the bully pulpit to disseminate such views is what draws many bad economists to economics in the first place. But that’s really tangential to my issue today. Serious economists, or most of them anyway, understand they’re not really meant to be doing that. No, my topic today involves who economists suppose are not meant to be doing that and doing other things I’ll discuss a bit later on.
The normative or ethical proposition in neoclassical welfare economics is a bit ambiguous on that particular issue because preferences on interpersonal ethics, such as those relating to economic power, aren’t usually ascribed to the theoretical ciphers of the Fairy Land. It seems a conscious feature of the artfully constructed Fairy Land meant to eliminate certain ethical issues, but awkwardly it mimics or parallels what for economists is an ethical proposition about what they’re meant to be doing as economists. Back in reality, one suspects some economists may get a bit confused and suppose it's an ethical proposition they’re meant to promote to real people, encourage real people to act more like the ciphers of the Fairy Land and thus also have no interpersonal ethics. What was meant to avoid contentious issues in the ethical half-theory of neoclassical welfare economics becomes transformed via philosophical ineptitude into a risibly implausible proposition in the ostensibly full ethical theory of bad economics in the conservative style.
However, that’s just one example of a general class of such issues. Another example I’ve discussed before is the role of greed. In the Fairy Land, greed under certain conditions, in certain carefully constructed contexts, by certain actors in certain roles, is cast as beneficial. In the context of bad economics in the conservative style, in contrast, Greed is Good wafts in like a poisonous miasma from the Fairy Land to become a risibly dodgy general ethical proposition in the ostensibly full ethical theory of bad economics in the conservative style. One may wonder if bad economists themselves are meant to express that normative proposition. May we assume they just say whatever people have paid them the most to say, with no regard for other values such as truth, honesty, as they suppose Greed is Good?
But the example I thought about recently that really prompted my discussion today concerns the normative proposition de gustibus non est disputandum. Sorry about that, but it is conventionally conveyed in Latin. And you know what that means, right? Red flag! It just means economists as such or qua economists are not meant to tell subjects what their preferences should be but rather just accept them as givens. Which subjects? The ciphers of the Fairy Land or real people? And preferences about what? Ethics? Let’s discuss.
In reality, of course, non-economists expend vast amounts of economic power forming, shaping, shifting, changing others’ preferences in various ways, via advertising, marketing, political rhetoric, serious argument, all sorts. For them, de gustibus est disputandum, and how. But those aren’t the actors the normative proposition in neoclassical welfare economics is meant to address, are they? It’s meant for economists, not others, nor even economists acting as private individuals rather than in their role as economists. Again the issue may get a bit opaque because in ethical theorizing appropriate to the Fairy Land, one doesn’t normally take up potential preferences of some ciphers to manipulate or change the preferences of other ciphers. It’s just not part of that artificial world. And again, are economists meant to propose real people behave more like the ciphers of the Fairy Land? Are the ciphers meant to be acting under a dodgy normative proposition economists must then transmit to real people? I wouldn’t have thought so, but some may think so.
It leads to a notable absurdity one finds commonly in economics in which economists, using arguments involving the de gustibus proposition, dispense advice to others on what economic arrangements, systems, goals they should prefer, browbeating all who oppose them. One wonders if they suppose their role as economists in reality must differ from their role as economists in the Fairy Land because reality and the Fairy Land differ in ways significant for the normative propositions involved? Normative propositions must be added in application? When these economists think about the normative content of neoclassical welfare economics, one wonders if they have in mind only the content relating to ciphers in the artfully constructed Fairy Land, or also the propositions added during application of the theory to reality.
The opaque, often dodgy ethical reasoning in normative economics is at least as interesting, and I would suggest rather more interesting, than the more commonly discussed potential normative biases that may intrude upon the engineering models of positive economics. When one thinks about normative economics, one shouldn’t make the mistake of focusing on the discussion of normative biases and so on derived from the philosophy of science. Rather look at the big issues: the explicit ethical propositions, arguments in normative economics.
