Thursday, February 3, 2011

The Moral Heart of Economics

Edward Glaeser argues for a moral foundation to the study of economies.

An important book by Dan Klein agrees and as I blogged earlier, exhorts participants in a free and liberal society to act upon the fundamental moral responsibility.

As Smith said, “To give the monopoly of the home market to the produce of domestic industry, in any particular art or manufacture, is in some measure to direct private people in what manner they ought to employ their capitals, and must, in almost all cases, be either a useless or a hurtful regulation.”

Economists are often wary of moral exhortation, as many see the harm so often wrought by arguments that are long on passion and short on sense. But don’t think that our discipline doesn’t have a moral spine beneath all the algebra. That spine is a fundamental belief in freedom.

So the foundational assumption that freedom is the ultimate value and the analysis of the costs and benefits of freedom make economics a moral endeavor. We know that Adam Smith held the chair in moral philosophy at Glasgow when he wrote both The Theory of Moral Sentiments and The Wealth of Nations. His project was to understand human behavior and emergent organizations through the moral, economic and judicial lenses of a moral philosophier.

His philosophy of justice, beneficience, prudence and self command informs the economics project and, as Dan Klein reminds those of use in the profession of economic education - we have an obligation to clearly present this moral code, the costs and benefits of this code and provide students with the tools of economic analysis to that they can evaluate this moral project.

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