Morality of Markets
By Kevin
It definitely can buy you this book...
Jonathan makes it seems as if economists are pitted against philosophers in his WSJ article.
[Economists] have assumed a role in society that for the past 4,000 years has been held by philosophers and theologians. They have made our lives freer and more efficient. And we are the poorer for it. - Jonathan Last
The truth is that economics has always been an extension of philosophy. Adam Smith was a philosopher who wrote first 'Theory of Moral Sentiments' before 'Wealth of Nations'. He wrote first,
How selfish soever man may be supposed, there are evidently some principles in his nature, which interest him in the fortune of others and render their happiness necessary to him, though he derives nothing from it except the pleasure of seeing it. That we often derive sorrow from the sorrow of others, is a matter of fact too obvious to require any instance to prove it.
Yet the most famous of Adam Smith's quote subsequently immortalized by generations of economists was:
"It is not from the benevolence of the butcher, the brewer, or the baker, that we expect our dinner, but from their regard to their own self-interest. We address ourselves, not to their humanity but to their self-love, and never talk to them of our own neccessities but of their advantages."
Jonathan focuses too much on what economist would consider 'static efficiency', which really is just one aspect of economics that is more easily analysed and subjected to greater scrutiny than its more important counterpart, 'dynamic efficiency'. Dynamic efficiency basically considers the long term efficiency consequences of different 'incentives' and signal mechanisms in the economy.
In other words, even the values, and attitudes that economics promote goes into the equation of dynamic efficiency - if it promotes destructive behaviours and interactions that is beneficial to actors in the short run but bad for the entire system, then there are grounds for these to be weeded out. In any case, the discipline acknowledges that competition or market forces are important in bringing about good outcomes but then by the second welfare theorem (when competition can't bring about the greatest welfare then there are ways to adjust the competition to motivate it to bring about that), we know that artificial frameworks and structures needs to be put in place to encourage what is good for dynamic efficiency.
That being said, Michael Sandel's book is definitely a good buy.
[Meanwhile, for those in UK reading this, you might want to enjoy an awesome Starbucks deal.]
Sandel & Justice
By Kevin
In anticipation of Michael Sandel's lectures in the LSE last week, I ended up (re)watching his entire Justice Harvard series again. It was fun reviving the philosophical discussions in my mind and thinking about tricky issues again. Then I attended the LSE Public Lecture 'Should a Banker be paid more than a Nurse?', which turned out to be a little disappointing but understandable because the lecture, being opened to the public, reduced the discussion to one that was charged with subjective judgments. It was less intellectual than intended and difficult to drive forward for Sandel because the framework utilized by the contributors were often inconsistent when they applied their arguments.
Perhaps the worst was that some were searching for an irrefutable stand rather than what they think should be the case. Ultimately, when one observes the lectures at Harvard, one could observe that the students of philosophy transcends the specific issue at hand and considers moral implications of their stand on other matters - little of that was observed at this public lecture.
Michael Sandel did a good job wrapping things up and facilitating the discussions even when I suspect he failed to bring out a point about the morality of markets, that I believe he might be trying to make. In any case, I could probably only settle on waiting for his next book.
Materialistic Rewards
By Kevin
Having failed to secure a seat in Alain de Botton's public lecture in the LSE led me to check out his talks on TED.com which turned out to be wonderful. His insights into life and philosophy is extremely powerful and can indeed be applied to living well.
Being Wrong
By Kevin
Kathryn Schulz, a leading 'wrongologist', shares about her study of 'being wrong' on TED.com. It is something interesting to look into and embracing fallibility is becoming something rather in fashion after more than a decade of bringing the attempt to perfect ourselves to to the extreme (think plastic surgery, motivational courses, self-improvement hypes, etc). I'm not too sure about her underlying thesis that we all feel that we're right most of the time. I know of people (practically all Asians) who tread so carefully in life they naturally assume they are wrong until they gathered enough evidence to satisfy themselves that they are not wrong (which - they have to highlight - does not necessarily mean they are right).
I must say that Kathryn's style of presentation does make her appear like she believes she is right; at least enough for her to write a book about it.
Philosophy & Wisdom
By Kevin
This story, as told by Plato, was shared with me by Peng Sing. It reminds us that the 'truths' we understand are limited. And they are often limited by ourselves.
There's a story about Socrates and the oracle of Delphi. Some guy went to ask the oracle, is there anyone wiser than Socrates - the oracle said no, no man is wiser than Socrates. The news came to Socrates, and he was shocked because Socrates was sure that he wasn't the wisest man, it's just not possible, because he was so aware of the limits of human knowledge and his own limits so he goes around asking many groups of people: politicians (who were absolutely sure i.e. overconfident), poets (who didn't really know what they were saying, but compose beautiful verses out of gut feeling), craftsmen (who were experts in their own field, but mistakenly take their expertise as wisdom). He realizes that no matter who he asks, nobody seems to be aware of his own ignorance. That's when he realizes that the oracle is correct - not because Socrates is the wisest man, but because there is no such thing as a wise man. Man can pursue wisdom, but will never be wise: he can only become aware of his own ignorance.
Is murder ever justifiable?
By Wei Seng
'Justice with Michael Sandel' series of lectures
I apologise for having not written in a very long time. I have been very busy last week with bringing my Canadian relatives around town, and I have a very short weekend this week as I came back from camp on Saturday and have to book back in by tonight. I have not found much inspiration for writing these days, but I was inspired by a video that I was introduced to by a friend. This friend's Law module in Nanyang Business School, taken as part of his studies for an Accounting degree, introduces concepts in law to familiarise students with the relation between law and business. But this video that I watched, while not exactly directly relevant to business law or anything like that, is something good to ponder about as you ask yourself what morality is.
Justice with Michael Sandel is a video production put up by Harvard University. Showcasing Prof Michael Sandel's popular Justice course lectures in Harvard, this production is available online for all to see, to experience for oneself how Harvard teaches, as well as to allow oneself some exposure to some concepts in philosophy and law. I watched the first video, a series of two lectures that first introduces viewers (and students in the auditorium where the video was filmed) to the concept of justice and morality using examples, and then introducing a real-life court case that forces us to question if murder (in the court case, cannibalism) can ever be justifiable / moral.
Fundamentally, the question posed: "Is it permissible to harm a smaller number of innocent people to prevent greater harm to a larger number of people?"
It is a bit lengthy, 55 minutes in total for the first video, but it is worth viewing for some thought-provoking questions to ask yourself, as well as to learn more about concepts in philosophy such as consequentialist moral reasoning, utilitarianism and categorical moral reasoning.
Coercion of Free Markets
By Kevin
Trading Goods...
Inequality is a market failure. We do pick this up in A Levels but then there's little discourse on that. Not only do we dwell little on the solutions - which ranges from progressive taxation to welfare handouts - we ultimately ignore how inequality undermines the ultimate roles of markets, which is the efficient allocation of resources. I've always grasp the idea rather intuitively but then fail to deliver it in a philosophical and economics framework. I've pointed out the lack of philosophical musings in today's study of Economics when I introduced Michael Sandel's lecture on Markets and Morals.
I've always pose the question to my Economics student, if a person earns $1000 a month and another who earns $1 a month both needs a glass of water. The rich guy is willing to pay $10 for the water while the poor one is willing to pay $1. The market thus allocates the water to the rich man. We all know that this allocation is problematic and it doesn't seem efficient; how is it that, in terms of willingness to pay, a person who is only willing to part with 1% of his monthly income gets the good when another is willing to part with 100% of his monthly income for it? So what exactly is the problem of inequality?
Once again, Michael Sandel points this out in the second lecture presented in this video. You don't exactly have to watch the lecture in order to grasp the point but the idea is that when inequality (in terms of unequal distribution of income) exists, effective demand cannot properly reflect the ideal sort of demand signal transmission that would allow the market to allocate resources efficiently. In extreme cases, free markets becomes not entirely free. In other words, people are not transacting out of their free will but coerced by their own economic circumstances. We see this very often in the case of poor people in developing countries who are forced to sell organs, resort to prostitution, act as surrogate mothers, become a runner for crack.
Gary Becker is not wrong about the rationality of these people. They're making rational choices but it is often that their choices is very much limited. That unfeeling market processes coerce us into certain decisions is something close to the hearts of all of us. Often, however, we can't quite work out what is so unjust about that because we believe that to a large extent, we determine our riches. Somehow, deep in our hearts we know that some other decisions that we made caused us to be in the state we are in such that we are coerced into making that next decision. The fact that this argument comes back to us shows how each and every decision made in the marketplace by us are not independent. This makes for a determinism argument in a market setting where free will is supposed to reign.
There are much wider implications of all these arguments and I shall explore them if I get the chance.
Just Reading
By Kevin
Father of Kantian Ethics
Just last week, I was recommending that you view lectures on Academic Earth if you find TED.com not academic enough; this week we're recommending just one video for your weekend. It's going to be pretty intriguing and I'm sure you'd be glad to be an audience. Recently, Michael Sandel, a political philosopher, lectured on 'Justice' in Harvard and his lectures are available online at Youtube! Sandel begins his first lecture with the hypothetical scenario involving a moral dilemma that some of you might be familiar with and got his students thinking about moral reasoning. Sandels issued his 'warning' for students of Moral/Political Philosophy:
Philosophy teaches us and unsettles us by confronting us with what we already know; there's an irony, the difficulty of this course consist the fact that it teaches what you already know. It works by taking what we already know from familiar unquestioned settings and making it strange. [...] Once the familiar turns strange, it is never quite the same again.
Sandel also gave a good reply to the doctrine of Skepticism, suggesting that we should not give up moral reasoning just because the ancient and modern philosophers are unable to solve them; in fact, the continual emergence of the same old problems require that we constantly revisit these questions. He cites Kant's remarks about skepticism; Kant describes skepticism as a temporary resting place for the mind from reasoning - that skepticism can never triumph the restlessness of reasoning.
The lectures gives us too much to think about so I strongly suggests that you take a step at a time and limit yourself to just an hour of the video each day.
Julian Baggins
By Kevin
Not a Duck Thing
A trip to the bookstore introduced me to two books by Julian Baggini, who turns out to be a 'philosopher'. It's rare to find anyone with this title to their names but he is by a large a journalist or writer from my point of view given the works he produce. The two books I stumbled on, which I found immensely useful to students of General Paper in Junior College level is The Duck That Won the Lottery and 99 Other Bad Arguments as well as The Pig That Wants to Be Eaten and 99 Other Thought Experiments.
The Duck is about arguments and rhetoric, which are aspects of writing and presentation that is usually missing in our General Paper classes. We have extremely few lessons where we truly tear apart arguments and examine rhetoric used by writers, politicians, activist. Getting to know how to avoid bad arguments and thereby make good ones would not only help lawyers in court but an ordinary student when it comes to presenting his/her ideas during lesson, trying to engage peers in a project/idea as well as General Paper writing.
The Pig, on the other hand, examines arguments made by others - basically a GP lesson for each of the text or passage examined in the book. It claims to hold thought experiments but basically Baggini is merely making readers think twice about arguments or scenarios presented and the ideas behind them. I didn't quite read the books but simply browse through them. Even if they don't present the topics well, they are good starting point for how you should actually be studying GP.
Baggini writes a lot of other books, perhaps more related to philosophy than the two I pointed out. In addition, he also does a magazine, TPM: The Philosopher's Magazine, which looks pretty impressive.
Xmas Economist
By Kevin
Merry Holidays!
This boxer day came with reads as well, ERPZ decided not to rest on the day after Christmas so here's your reads for this holiday weekend, almost all from The Economist's latest double issue's Christmas Specials.
We first have Arguing till Death, a lesson for America from history's greatest Western Philosopher, Socrates' life. I got introduced to Aristophanes' The Clouds through the article and is pleasantly surprised by the sort of humour ancient Greeks were capable of.
Hi There discusses politeness and courtesy in the English Language and the effect of this spread of English Language on the world today. The other talks about the virtues and motivations of being a foreigner in the world today and on the same issue is an article, A Ponzi scheme that works that looks into the migrant society of America today and the allure of it.
For viewing pleasure, How to make a splash in social media by Alex Ohanian. It'll only require about 4 plus minutes of your attention; a short time before you dash off to the next party. Ohanian really gives a strong message about how the Internet works and how you might be able to ride on it to help you with a cause, but like what he says in the end, 'you are not going to be in control'.
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