Monday, July 2, 2012
Economics and ethics — rationality and utility
In Nichomachean Ethics, Aristotle begins with the principle that every agent acts for an end that the agent regards as a "good." This is the utility principle. Aristotle continues, saying that almost everyone agrees that goods falls under the category of what results in happiness. This is the principle that unites utility with satisfaction.
Aristotle concludes from these two principles that happiness is the by-product of goods. We would say that satisfaction is a consequence of utility. Some would argue over whether satisfaction is equivalent to utility or a necessary condition for it, or a sufficient condition, or and necessary and sufficient condition.
Aristotle then goes on to say that that there are many goods that bring satisfaction, depending on the type of desire and the relative strength of competing desires, or as we would say, preference and indifference.
Then Aristotle notes that the ethical issue is ranking goods and determining whether there is a "natural" or "proper" good for man. That is to say, it is generally agreed by all but the morally immature that some apparent goods are not good at all in the larger scheme of things. Customs, and the rule of law in civilized society, distinguish these. Part of the socialization of children through upbringing and education is about learning these distinctions.
But the issue, according to Aristotle is whether there is some higher principle operative. Aristotle opines that man is a "rational animal" and therefore that this higher principle must accord with reason.
Then Aristotle examines existing ethical theories about the good that is to be pursued to gain happiness. He analyzes them to show who they are found wanting because they do not sufficiently satisfy man's rational nature and thus provide genuine and abiding happiness but rather only fleeting satisfaction.
According to Aristotle, the true good for man lies in unfolding his potential as a rational animal by developing his rational faculties and actualizing this potential as human "excellence." The Greek term that Aristotle uses is arete, which is often also rendered into English as "virtue." But "virtue" has the connotation now of conforming to conventional mores. Aristotle definitely did not mean that.
For Aristotle achieving excellence meant unfolding full potential as human being and also as an individual. While individual potential differs, human potential culminates in contemplating the unmoved mover as final cause, Aristotle's version of the Platonic good as universal principle.
This is basically the same teaching as is found in the teaching of the sages of all ages and place. It is called perennial wisdom.
Platonic thought dominated Western thought until he middle ages, when Aristotle's works that had been preserves in Arabia were re-introduced. But early Christianity was shaped by Augustine's philosophy, which was heavily Neoplatonic. After the re-introduction of Aristotle, Aquinas synthesized Augustine with Aristotle.
For Aquinas the will is the rational appetite. It is free will that makes free choice possible, and humans can choose among many desires in their quest for satisfaction. The object of the will is alway an end that it takes to be apparently good. Humans, being rational animals, are presente with choices whose object is either carnal or rational. Carnal desires, which are "lust," can never be satisfied since their objects are ephemeral. Only rational desires can be satisfied, since their objects are eternal and invariant.
The will of all sentient being most prefers existence. Aquinas distinguishes between transitory existence ended by death and rational being, which is universal and unchanging and whose attributes are universality (oneness), truth (knowledge of reality), goodness (attraction) and beauty (satisfaction). The true good of a rational being is love for being qua being, not this or that. That good is found in contemplation and made manifest by imbuing ones' action with love.
Bonaventure was a contemporary of Aquinas, and his philosophy emphasized will and love over Aquinas's emphasis on intellect and knowledge. This tension would manifest in subsequent culture as the dichotomy between rationalism and romanticism, just as differences between Plato and Aristotle gave rise to idealism and realism.
Then we arrive at the modern era and modern philosophy, where these same issues dominate in different form. To paraphrase Whitehead, Western thought is a footnote to Plato. (Aristotle was Plato's student).
Mill rejected the simplicity of Bentham and reiterated the distinction between carnal and rational goods thus, "It is better to be a human being dissatisfied than a pig satisfied; better to be Socrates dissatisfied than a fool satisfied. And if the fool, or the pig, are of a different opinion, it is because they only know their own side of the question."
Even über-Libertarian and Austrian School economist Murray Rothbard distinguished between a genuine Libertarianism like his own that leaves individuals free from coercion to choose as they please, the only contraint being not coercing others, from what he called "modal libertarianism" that conflates liberty with license.
Thus the question remains about criteria for evaluating types of preference based on their objects as a matter of ethics, and using such criteria to order societies through custom and tradition, institutional arrangements including governing, and the rule of law.
This is about setting boundaries on behavior and assumptions, methods, and criteria for doing so. All rationales for alternatives rest on assumptions that are either stipulated, or else involve circular reasoning or ever descending turtles (infinite regress). Criteria are context-specific, so different worldviews are defined by the criteria that serve as boundary conditions and norms. There are no "transcendental" criteria that all people agree upon without qualification.
In pluralistic societies, the society must develop a culture whose boundary conditions are sufficiently open and flexible as to be able to order the society and also develop institutional arrangements that avoid conflict among groups with greatly varying viewpoints. In a liberal democracy that requires tolerance and compromise.