If there is one phrase that sums up what's wrong with economics, it is "specious assumptions." The most specious assumption is that science is an independent disciple that investigates reality in order to discover natural invariances that can be modeled formally, similar to physics.
This involves denial that economics is a social science with emphasis on social. The social aspect of economics implies, first, that the subject matter is different from natural science, which also implies the need to employ different methodology in approaching it.
Secondly, as an implication of the assumption that economics is natural science, it is also assumed that outcomes are "natural" as long as natural processes, here market forces, are not interfered with artificially.
This is based on a concept of human being, called homo economicus, that does not accord with the findings of other disciplines about human being as homo socialis. It also puts economics at odds with widely accepted norms of social justice based on liberal principles grounded in equality of persons and the fairness this implies as the basis for rights.
There are good argument against government imposing any particular moral code in a liberal society. But to conclude from this that society is therefore immoral would be a violation of the fundamental principles of liberalism, which include egality and solidarity along with freedom.
Morality and ethics are imposed socially by political decisions taken democratically in a liberal society and promulaged through positive law and rights based on a concept of justice that is founded on the liberal principles of equality of persons before the law and due process. This implies lack of privilege and social fairness.
A growing body of research into well-being and happiness tells us to look beyond money and consumption. While income matters a great deal at lower levels – when one is poor, a little money makes a big difference – but once basic needs are met, higher income does not necessarily translate into gains in happiness. Research points to substantial benefits to be had from a more equitable distribution of wealth – inequality manifests in weaker performance on a range of social and health indicators. Social fairness in terms of income and employment distribution may, in fact, be vital for achieving the changes required for a transition to a sustainable economy.
Some key insights into well-being relevant to a new conception of “the good life” include (key references at end):
- Full employment and decent work....
- Time use and work-life balance....
- Community and social cohesion....
One major report to the French government from two Nobel laureates [Joseph Stiglitz and Amartya Sen] in economics argues that progress should be understood by assessing a diverse array of well-being indicators to capture a more comprehensive understanding of people’s lives, spanning key areas of: health, education, environment, employment, material comfort, interpersonal connectedness and political engagement.
The Canadian Index for Wellbeing (CIW) was launched only recently in 2010 as a counterweight to the gross domestic product numbers. It aims to measure and track the quality of life of Canadians and is comprised of 64 indicators. The CIW has demonstrated that Canadians’ quality of life has not kept pace with the country’s economic growth from 1994 to 2008, where although GDP grew 31%, CIW rose only 11% in the same period. A key reason is that Canadians are spending less and less time on healthy social and leisure activities, and the state of the environment has declined.
This growing body of research is broadly consistent with the notion of climate action and climate justice....
The Progressive Economics Forum
