Jim wrote:
>
> No, since the rational calculating machines only take into account the
> costs and benefits to themselves. It's very common in economics to point to
> the difference between individual rationality and efficiency from a more
> social perspective. It's true that economists generally show a strong bias
> toward privileging individual rationality over social efficiency. (This is
> especially true of Chicago schoolmen.) But that arises because they avoid
> accepting the fact that production is socialized, i.e., that externalities
> (both technical and pecuniary ones) are ubiquitous. (In fact, the idea of
> pecuniary externalities is generally rejected in an _a priori_ way and
> usually not even mentioned. It's sort of a dirty secret...)
But the institutional environment (e.g. property rights, role of markets,
export taxes, pollution controls and taxes, etc.) in which individuals make
these decisions is itself the outcome of such decisions isn't it? How,
without self-contradiction, can this environment be conceived as having been
so constructed as to leave a "free lunch" in place?
>
> The "calculating machine" image of individuals that Veblen criticized has
> been dropped by economists (even in some intro textbooks). Instead, the
> currently-dominant model is basically tautological: people choose what they
> choose and the only way one can figure out what their preferences are is by
> looking at what they choose (revealed preference). "Rationality"
> (consistency) is tautological, since people may have a taste for variety,
> so that revealed preferences need not be consistent.
>
By "calculating machine" I meant the identification of reason with deductive
reasoning ("calculating") from fixed precisely defined axioms (e.g. the
axioms of rational choice theory).
> The parts that are not tautological is (1) the assumption that tastes are
> given exogenously and (2) the usual assumption that people are totally
> individualistic, not caring about the feelings of others besides their
> immediate families. The first is preserved because economists usually
> eschew reading sociology and psychology and usually sneer at these fields
> (especially the former). (Matt Rabin of UC-Berkeley (Brad's colleague) had
> a useful survey article on "economics and psychology," but I doubt that
> this will effect the dominant perspective of the orthodox economists.)
>
> The assumption that people are totally individualistic is contradicted by
> the fact that people actually being willing to vote in a representative
> election even though one's vote has absolutely no effect on the outcome.
> But at least in the U.S., economists are products of an extremely
> individualistic culture and so cling to the individualism assumption and
> seek to preserve their theory by adding epicycles. (Of course, economists
> usually ignore the role of the culture they're embedded in.)
>
It seems to me there is more substance than this.
The elements that constitute the content of "preferences" are assumed to be
externally rather than internally related.
The values embodied in these preferences exclude those values which e.g.
Dante, Shakespeare, Kant, Goethe, Hegel, Marx, Marshall and Keynes claim are
the true ultimate values, values whose realization in an individual life
makes that individual's life "good". These are "love within the Highest
Sphere" (Dante) - i.e. relations of "mutual recognition" with others (as in
Marx's description of how we would produce if "carried out production as
human beings") - and "beauty".
"By far the most valuable things, which we can know or imagine, are certain
states of consciousness, which may be roughly described as the pleasures of
human intercourse and the enjoyment of beautiful objects." (G.E. Moore,
Principia Ethica, p. 237)
This are the values that would govern existence in the "realm of freedom".
"Individualism" in the general philosophical sense (which Keynes endorses in
the form expressed in "Paley's dictum that 'although we speak of communities
as of sentient beings and ascribe to them happiness and misery, desires,
interests and passions, nothing really exists or feels but individuals' "My
Early Beliefs", vol. X, p. 449) is mistakenly identified with possessive
individualism and atomism.
Ted
--
Ted Winslow E-MAIL: [EMAIL PROTECTED]
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