Economics and Morality

• Author: Timothy Taylor
• Position: Managing Editor of the American Economic Association's Journal of Economic Perspectives, based at Macalester College in St. Paul, Minnesota. He blogs at http://conversableeconomist.blogspot.com.

ECONOMISTS prefer to sidestep moral issues. They like to say they study trade-offs and incentives and interactions, leaving value judgments to the political process and society.

But moral judgments aren’t willing to sidestep economics.

Critiques of the relationship between economics and moral virtue can be grouped under three main headings: To what extent does ordinary economic life hold a capacity for virtue? Is economic analysis overstepping its bounds into zones of behavior that should be preserved from economics? Does the study of economics itself discourage moral behavior?

Capacity for virtue

After a rough day at work, or when the bills come due, many of us feel what Henry David Thoreau meant when he wrote in 1854: “The mass of men lead lives of quiet desperation.”

Indeed, philosophers since the time of Aristotle have drawn a line separating economic life from a life that is virtuous or well lived. For example, Aristotle wrote in the Nicomachean Ethics, “The life of money-making is one undertaken under compulsion, and wealth is evidently not the good we are seeking; for it is merely useful and for the sake of something else.”

These philosophers note that people often work only to earn money for such necessities as food, shelter, and clothing. In contrast, they point to a range of freely chosen human activities that are better aligned with virtuous behavior: love and friendship, art and music, bravery in war, participation in the community, healing the sick, helping the poor, and so on.

But the compulsions and necessities of work life have other aspects, too. Thoreau’s friend and fellow Transcendentalist philosopher Ralph Waldo Emerson said in 1844: “[W]hether thy work be fine or coarse, planting corn, or writing epics, so only it be honest work, done to thine own approbation, it shall earn a reward to the senses as well as to the thought: no matter, how often defeated, you are born to victory. The reward of a thing well done is to have done it.” Do the job well, whether serving fast food to hungry customers, driving a cab, cleaning a hotel room, pouring concrete for road building, organizing an off-site miniconference for the office, or anything else. The work may be for pay, but in this view, honest work done well offers compensation beyond money.

Indeed, an alternative philosophical tradition about the relationship between economic life and moral virtue, with roots in the work of John Locke and explicitly opposed to the Aristotelian tradition, views work and economic activity not as the grim and amoral drudgery of wage slavery and money making, but as a way individual humans relate to the world around them and shape themselves.

Andrzej Rapaczynski (2013) described this perspective: “[W]hat labor produces is not just goods or commodities, but the very autonomous human beings who now live the lives they themselves design and determine. Thus, labor, which is at the basis of economic life, far from enslaving those who engage in it, is the prime expression of human creativity, a true production of new reality governed by human intellect and imagination, in which we can recognize and shape ourselves in accordance with our own will.” While art, literature, and music, because of their “particularly sophisticated nature . . . may be more clearly recognizable as the primary artifacts of human culture . . . their place in human life is not in principle different from the other objects we produce both to consume and to define the fundamental conditions of our own existence,” the professor of law and philosophy wrote.

In a similar spirit, modern economist-philosophers have compiled a list of virtues that can be intrinsic within market behavior. Deirdre McCloskey (2006) wrote of seven virtues of middle-class economic life: love (benevolence and friendship), faith (integrity), hope (entrepreneurship), courage (endurance and perseverance), temperance (restraint and humility), prudence (know-how and foresight), and justice (social balance and honesty). Similarly, Luigino Bruni and Robert Sugden (2013) have suggested that participation in work and commerce is congruent with such virtues as self-help, enterprise and alertness, trust and trustworthiness, respect for the wishes of others, and perceiving others as potential partners in a mutually beneficial transaction.

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