Many philosophers appeal to the “fallacy of approximation”, or “problem of second best”. However, despite the pervasiveness of such appeals, there has been only a single attempt to provide a systematic account of what the fallacy is. We identify the shortcomings of this account and propose a better one in its place. Our account not only captures all the contexts in which approximation-based reasoning occurs but also systematically explains the several different ways in which it can be in error.

Principles of justice, David Estlund argues, cannot be falsified by people’s unwillingness to satisfy them. In his Utopophobia, Estlund rejects the view that justice must bend to human motivation to deliver practical implications for how institutions ought to function. In this paper, I argue that a substantive argument against such bending of justice principles must challenge the reasons for making these principles sensitive to motivational limitations. Estlund, however, provides no such challenge. His dispute with benders of justice is therefore a (...) verbal one over the true meaning of justice, which need not worry those with the intuition that justice should perform a function that requires bending. By focusing on John Rawls’s reasons for bending his justice principles, I point towards a substantive critique of bent justice. (shrink)

Structural requirements of rationality prohibit various things, like having inconsistent combinations of attitudes, having means-end incoherent combinations of attitudes, and so on. But what is the distinctive feature of structural requirements of rationality? And do we fall under an obligation to be structurally rational? These issues have been at the heart of significant debates over the past fifteen years. Some philosophers have recently argued that we can unify the structural requirements of rationality by analyzing what is constitutive of our attitudes (...) (Lee, 2020; Worsnip, 2018a). It has also been suggested that, in the course of good first-personal deliberation, agents should treat structurally irrational combinations of attitudes as off-limits (Worsnip, 2021). In this paper, I raise a worry for these two theses concerning structural rationality. Roughly, I argue that some imperfect epistemic agents (like us) can be disposed to have structurally irrational combinations of attitudes. Also, when these imperfect agents deliberate, they should not treat structurally irrational combinations of attitudes as off-limits. Given our imperfections, being structurally irrational can very well be the best option we have. More generally, these observations reveal that structural rationality should not always be theorized independently from more “substantive” norms, like responsiveness to reasons or expected value optimization. (shrink)

This paper clarifies the usage of Albert Hirschman’s categories of market behaviour as of exit and voice in debates about workplace democracy by taking seriously his critique of the neoclassical analysis of competition. Pro-market liberals are generally hostile to the idea of workplace democracy and tend to favour top-down hierarchies as a way of organising labour. This hostility is generally inspired by the neoclassical analysis of exploitation and efficiency, which leads them to defend distributions achieved through exit-based competitive equilibria. Following (...) Hirschman, I propose to consider a hypothetical alternative: a democratic equilibrium, reached through the use of voice. I show that it would present the same appealing characteristics than its competitive counterpart while also accounting for the non-ideal conditions in which markets operate. Support for free markets should entail support for workplace democracy minimally understood as a strengthening of voice. (shrink)

Efficient markets are alienating if they inhibit us from recognizably caring about one another in our productive activities. I argue that efficient market behaviour is both exclusionary and fetishistic. As exclusionary, the efficient marketeer cannot manifest care alongside their market behaviour. As fetishistic, the efficient marketeer cannot manifest care in their market behaviour. The conjunction entails that efficient market behavior inhibits care. It doesn’t follow that efficient market behavior is vicious: individuals might justifiably commit to efficiency because doing so serves (...) the common good. But efficient market systems nevertheless have significant opportunity costs. The discussion yields a range of desiderata for non-alienated economic organization. (shrink)

What is the relevance of ideals for determining virtuous argumentative practices? According to Bailin and Battersby (2016), the telos of argumentation is to improve our cognitive systems, and adversariality plays no role in ideally virtuous argumentation. Stevens and Cohen (2019) grant that ideal argumentation is collaborative, but stress that imperfect agents like us should not aim at approximating the ideal of argumentation. Accordingly, it can be virtuous, for imperfect arguers like us, to act as adversaries. Many questions are left unanswered (...) by both camps. First, how do we conceptualize an ideal and its approximation? Second, how can we determine what is the ideal of argumentation? Third, can we extend Stevens and Cohen’s anti-approximation argument beyond virtue theory? In order to respond to these questions, this paper develops a second-best perspective on ideal argumentation. The Theory of the Second Best is a formal contribution to the field of utility (or welfare) optimization. Its main conclusion is that, in non-ideal circumstances, approximating ideals might be suboptimal. (shrink)

In recent years, insurance companies have begun tracking their customers’ behaviors and price premiums accordingly. Based on the Market-Failures Approach as well as the Justice-Failures Approach, I provide an ethical analysis of the use of tracking technologies in the insurance industry. I focus on the use of telematics in car insurance and on the use of fitness tracking in life insurance. The use of tracking has some important benefits to policyholders and insurers alike: it reduces moral hazard and fraud, increases (...) actuarial fairness, and incentivizes safe behavior. These benefits, however, are outweighed by significant moral objections. First, the use of tracking technologies significantly undermines the fairness of the interaction between insurance companies and policyholders. Specifically, the use of tracking eliminates information asymmetries, but in such a way that favors insurers exclusively. Furthermore, tracked behaviors and the ability to choose to behave safely are highly correlated with other variables such as income. Therefore, tracking-based insurance relies on and exacerbates existing inequalities and injustices, which undermines the benefits that tracking is supposed to introduce. (shrink)

The Market Failures Approach (MFA) is one of the leading theories in contemporary business ethics. It generates a list of ethical obligations for the managers of private firms that states that they should not create or exploit market failures because doing so reduces the efficiency of the economy. Recently the MFA has been criticised by Abraham Singer on the basis that it unjustifiably does not assign private managers obligations based on egalitarian values. Singer proposes an extension to the MFA, the (...) Justice Failures Approach (JFA), in which managers have duties to alleviate political, social, and distributive inequalities in addition to having obligations to not exploit market failures. In this paper I describe the MFA and JFA and situate them relative to each other. I then highlight a threefold distinction between different types of obligations that can be given to private managers in order to argue that a hybrid theory of business ethics, which I call the MFA +, can be generated by arguing that managers have obligations based on efficiency and duties based on equality to the extent that these latter obligations do not lead to efficiency losses. This argument suggests a novel theoretical option in business ethics, elucidates the issues that are at stake between the MFA and the JFA, and clarifies the costs and benefits of each theory. (shrink)

Approximate coherentism suggests that imperfectly rational agents should hold approximately coherent credences. This norm is intended as a generalization of ordinary coherence. I argue that it may be unable to play this role by considering its application under learning experiences. While it is unclear how imperfect agents should revise their beliefs, I suggest a plausible route is through Bayesian updating. However, Bayesian updating can take an incoherent agent from relatively more coherent credences to relatively less coherent credences, depending on the (...) data observed. Thus, comparative rationality judgments among incoherent agents are unduly sensitive to luck. (shrink)

Epistemically immodest agents take their own epistemic standards to be among the most truth-conducive ones available to them. Many philosophers have argued that immodesty is epistemically required of agents, notably because being modest entails a problematic kind of incoherence or self-distrust. In this paper, I argue that modesty is epistemically permitted in some social contexts. I focus on social contexts where agents with limited cognitive capacities cooperate with each other (like juries).

Which rules should guide our reasoning? Human reasoners often use reasoning shortcuts, called heuristics, which function well in some contexts but lack the universality of reasoning rules like deductive implication or inference to the best explanation. Does it follow that human reasoning is hopelessly irrational? I argue: no. Heuristic reasoning often represents human reasoners reaching a local rational maximum, reasoning more accurately than if they try to implement more “ideal” rules of reasoning. I argue this is a genuine rational achievement. (...) Our ideal rational advisors would advise us to reason with heuristic rules, not more complicated ideal rules. I argue we do not need a radical new account of epistemic norms to make sense of the success of heuristic reasoning. (shrink)

What is the best way to make sustained societal progress over time? Non-ideal theory done on its own faces the problem of second best, but ideal theory seems unable to cope with disagreement about how to make progress. If ideal theory gives up its claims to completeness, then we can use the method of incompletely theorized agreements to make progress over time.

Virtue ethics is increasingly regarded as a viable alternative to consequentialist or deontological systems of normative ethics. This paper argues that there can be no such triumvirate of contending comprehensive ethical systems. That is not because virtue is unimportant but rather because genuine virtue is excellent and therefore rare. For most people in most morally salient situations there is no possibility of virtuous response because possession of the relevant virtues simply does not obtain nor can be usefully simulated. Instead, the (...) much more universal and important moral requirement is suitable moderation of one’s vices. Nor should it be supposed that the absence of virtue(s) necessarily diminishes the quality of an individual’s life and that person’s value to others. Rather, moral deficiencies are compatible with other excellences and may indeed contribute to them. I conclude that virtue ethics is less worthy of pursuit than vice ethics. (shrink)

This paper critiques the version of the argument that the regulation of hateful speech by the state undermines its democratic legitimacy made by Ronald Dworkin and James Weinstein. It argues that in some cases the harmful effects of hateful speech on the democratic process outweigh those of restriction. It does not challenge the central premise of the Legitimacy Argument, that a wide-ranging right to freedom of expression is an essential political right in a liberal democracy. Instead, it uses ideal and (...) nonideal theory as a framework for judgements about the regulation of hate speech. The mistake underpinning the Legitimacy Argument is that it assumes that other conditions pervade that make an ideal democratic procedure possible when they do not. In reality the state can be put in a position where, whatever course of action it takes with regard to the regulation or non-regulation of hate speech, some citizens will not be able to participate fully in political deliberation. Under such conditions there remain strong pro tanto reasons not to regulate hate speech on democratic grounds, but they are not all-things-considered reasons, and there are also pro tanto reasons to regulate hate speech that might outweigh them in some cases. This leads to the cautious conclusion that while there might be a normative justification for the regulation of hate speech in individual instances, the debate is best understood as one between competing pro tanto reasons, and must be approached on a case-by-case basis. (shrink)

The view of business ethics that Christopher McMahon calls the “implicit morality of the market” and Joseph Heath calls the “market failures approach” has received a significant amount of recent attention. The idea of this view is that we can derive an ethics for market participants by thinking about the “point” of market activity, and asking what the world would have to be like for this point to be realized. While this view has been much-discussed, it is still not well-understood. (...) This paper seeks to remedy this problem. I begin by showing, against some recent commentators, that McMahon’s view and Heath’s view are fundamentally the same. Second, I clarify the sense of “efficiency” at work in the market failures approach. Finally, I argue that, in its current form, this view has little relevance to the real world of business. I conclude by sketching two ways of modifying it to fit our world. (shrink)

The paper deals with “perfect institutional regimes”, defined as regimes that optimally satisfy a given value. Assuming that a PIR is unfeasible in the short term to agents willing to achieve it, what reasons do we have to spend time on a PIR? One answer is that knowing about PIRs is interesting enough to warrant an inquiry into the subject, even if it is not likely to change the world. Another is that searching for a PIR helps to set up (...) the principles under which more modest proposals of change are to be evaluated. Another, finally, is that theorizing about a PIR may have a motivational impact: although there are no motivated agents to whom the realization of a PIR is nowadays feasible, talking about it might lead to a change of this scenario. (shrink)

Lipsey and Lancaster's "general theory of second best" is widely thought to have significant implications for applied theorizing about the institutions and policies that most effectively implement abstract normative principles. It is also widely thought to have little significance for theorizing about which abstract normative principles we ought to implement. Contrary to this conventional wisdom, I show how the second-best theorem can be extended to myriad domains beyond applied normative theorizing, and in particular to more abstract theorizing about the normative (...) principles we should aim to implement. I start by separating the mathematical model used to prove the second-best theorem from its familiar economic interpretation. I then develop an alternative normative-theoretic interpretation of the model, which yields a novel second best theorem for idealistic normative theory. My method for developing this interpretation provides a template for developing additional interpretations that can extend the reach of the second-best theorem beyond normative theoretical domains. I also show how, within any domain, the implications of the second-best theorem are more specific than is typically thought. I conclude with some brief remarks on the value of mathematical models for conceptual exploration. (shrink)

The Fallibility Norm—the claim that we ought to take our fallibility into account when managing our beliefs—appears to conflict with several other compelling epistemic norms. To shed light on these apparent conflicts, I distinguish two kinds of norms: norms of perfection and norms of compensation. Roughly, norms of perfection tell us how agents ought to behave if they’re to be perfect; norms of compensation tell us how imperfect agents ought to behave in order to compensate for their imperfections. I argue (...) that the Fallibility Norm is a norm of compensation, and that thinking of it like this helps us make progress in debates surrounding disagreement, higher-order evidence, and coherence. (shrink)

This paper offers the concept of “justice failure,” as a counterpart to the familiar idea of market failure, in order to better understand managers’ ethical obligations. This paper takes the “market failures approach” to business ethics as its point of departure. The success of the MFA, I argue, lies in its close proximity with economic theory, particularly in the idea that, within a larger scheme of social cooperation, markets ought to pursue efficiency and leave the pursuit of equality to the (...) welfare state. As a result, the core ethical responsibility of business actors is to avoid profiting off of market failure. After reviewing this approach I challenge its emphasis on efficiency. I argue that just as we note the suboptimal efficiency of actual markets, we should also take seriously the suboptimal equality of actual welfare states. Taking this idea seriously results in a whole other set of ethical responsibilities for businesses to take into account; in addition to market imperfections and regulatory lacunae, managers should also avoid profiting from, and exacerbating, structural inequalities and injustices. I offer an outline of the kinds of injustices and inequalities that would have bearing on business ethics, and the kinds of ethical responsibilities that this approach suggests that business actors should take into account. (shrink)

Jones and Felps claim that social welfare would be enhanced, if corporate managers adopted the goal of directly improving the happiness of their stakeholders instead of profit maximization. I argue that their argument doesn’t establish this. They show that a utilitarian case for profit orientation cannot be made from the armchair. But neither can the case for Jones and Felps’ preferred alternative. And their defense of it relies on empirically unsubstantiated assumptions.

There is an increasing need for norms to be embedded in technology as the widespread deployment of applications such as autonomous driving, warfare and big data analysis for crime fighting and counter-terrorism becomes ever closer. Current approaches to norms in multi-agent systems tend either to simply make prohibited actions unavailable, or to provide a set of rules which the agent is obliged to follow, either as part of its design or to avoid sanctions and punishments. In this paper we argue (...) for the position that agents should be equipped with the ability to reason about a system’s norms, by reasoning about the social and moral values that norms are designed to serve; that is, perform the sort of moral reasoning we expect of humans. In particular we highlight the need for such reasoning when circumstances are such that the rules should arguably be broken, so that the reasoning can guide agents in deciding whether to comply with the norms and, if violation is desirable, how best to violate them. One approach to enabling this is to make use of an argumentation scheme based on values and designed for practical reasoning: arguments for and against actions are generated using this scheme and agents choose between actions based on their preferences over these values. Moral reasoning then requires that agents have an acceptable set of values and an acceptable ordering on their values. We first discuss how this approach can be used to think about and justify norms in general, and then discuss how this reasoning can be used to think about when norms should be violated, and the form this violation should take. We illustrate how value based reasoning can be used to decide when and how to violate a norm using a road traffic example. We also briefly consider what makes an ordering on values acceptable, and how such an ordering might be determined. (shrink)

ABSTRACT:Employing utilitarian criteria, Jones and Felps, in “Shareholder Wealth Maximization and Social Welfare: A Utilitarian Critique” (Business Ethics Quarterly23[2]: 207–38), examined the sequential logic leading from shareholder wealth maximization to maximal social welfare and uncovered several serious empirical and conceptual shortcomings. After rendering shareholder wealth maximization seriously compromised as an objective for corporate operations, they provided a set of criteria regarding what a replacement corporate objective would look like, but do not offer a specific alternative. In this article, we draw (...) on neo-utilitarian thought to advance a refined version of normative stakeholder theory that we believe addresses a major remaining criticism of extant versions, their lack of specificity. More particularly, we provide a single-valued objective function for the corporation—stakeholder happiness enhancement—that would allow managers to make principled choices between/among policy options when stakeholder interests conflict. (shrink)

While John Rawls made the notion of a “modus vivendi” prominent in political philosophy, he treats modus vivendi arrangements rather short and dismissively. On the other hand, some political theorists like John Gray praise modus vivendi as the only available and legitimate goal of politics. In the article I sketch the outlines of a different, more nuanced approach to modus vivendi arrangements. I argue that the moral standing of modus vivendi arrangements varies, and I try to spell out the factors (...) that determine the relative moral standing of modus vivendi arrangements. (shrink)

There is an idea, extremely common among social contract theorists, that the primary function of social institutions is to secure some form of cooperative benefit. If individuals simply seek to satisfy their own preferences in a narrowly instrumental fashion, they will find themselves embroiled in collective action problems – interactions with an outcome that is worse for everyone involved than some other possible outcome. Thus they have reason to accept some form of constraint over their conduct, in order to achieve (...) this superior, but out-of-equilibrium outcome. A social institution can be defined as a set of norms that codify these constraints.1 Simplifying somewhat, one can then say that social institutions exist in order to secure gains in Pareto-efficiency. (shrink)

Should our factual understanding of the world influence our normative theorising about it? G.A. Cohen has argued that our ultimate normative principles should not be constrained by facts. Many others have defended or are committed to various versions or subsets of that claim. In this paper I dispute those positions by arguing that, in order to resist the conclusion that ultimate normative principles rest on facts about possibility or conceivability, one has to embrace an unsatisfactory account of how principles generate (...) normative political judgments. So political theorists have to choose between principles ostensibly unbiased by our current understanding of human motivation and political reality, or principles capable of reliably generating political judgments. I conclude with wider methodological observations in defence of the latter option, and so of a return to political philosophy’s traditional blend of normative and descriptive elements. (shrink)

Adam Smith rejected Mandeville's invisible-hand doctrine of 'private vices, publick benefits'. In The Theory of Moral Sentiments his model of the 'impartial spectator' is driven not by sympathy for other people, but by their approbation. The innate capacity for sympathy makes approbation credible. Approbation needs to be authenticated, and in Smith's model authentication relies on innate virtue, which is not realistic. An alternative model of 'regard' makes use of signalling and is more pragmatic. Modern versions of the invisible hand in (...) rational choice theory and neo- liberalism are shown to be radical departures from the ethical legacy of Enlightenment and utilitarian economics, and are not consistent with Adam Smith's own position. (shrink)

Upshot: In our response we focus on five questions that point to important common themes in the commentaries: why start in wicked problems, what kind of system is a scientific perspective, what is the nature of second-order research processes, what does this mean for understanding interdisciplinary work, and how may polyocular research help make real-world decisions.

Context: The problems that are most in need of interdisciplinary collaboration are “wicked problems,” such as food crises, climate change mitigation, and sustainable development, with many relevant aspects, disagreement on what the problem is, and contradicting solutions. Such complex problems both require and challenge interdisciplinarity. Problem: The conventional methods of interdisciplinary research fall short in the case of wicked problems because they remain first-order science. Our aim is to present workable methods and research designs for doing second-order science in domains (...) where there are many different scientific knowledges on any complex problem. Method: We synthesize and elaborate a framework for second-order science in interdisciplinary research based on a number of earlier publications, experiences from large interdisciplinary research projects, and a perspectivist theory of science. Results: The second-order polyocular framework for interdisciplinary research is characterized by five principles. Second-order science of interdisciplinary research must: 1. draw on the observations of first-order perspectives, 2. address a shared dynamical object, 3. establish a shared problem, 4. rely on first-order perspectives to see themselves as perspectives, and 5. be based on other rules than first-order research. Implications: The perspectivist insights of second-order science provide a new way of understanding interdisciplinary research that leads to new polyocular methods and research designs. It also points to more reflexive ways of dealing with scientific expertise in democratic processes. The main challenge is that this is a paradigmatic shift, which demands that the involved disciplines, at least to some degree, subscribe to a perspectivist view. Constructivist content: Our perspectivist approach to science is based on the second-order cybernetics and systems theories of von Foerster, Maruyama, Maturana & Varela, and Luhmann, coupled with embodied theories of cognition and semiotics as a general theory of meaning from von Uexküll and Peirce. (shrink)

Political philosophers frequently claim that political ideals can provide normative guidance for unjust and otherwise nonideal circumstances. This is mistaken. This paper demonstrates that political ideals contribute nothing to our understanding of the normative principles we should satisfy amidst unjust or otherwise nonideal circumstances.

Recent methodological debates regarding the place of feasibility considerations in normative political theory are hindered for want of a rigorous model of the feasibility frontier. To address this shortfall, I present an analysis of feasibility that generalizes the economic concept of a production possibility frontier and then develop a rigorous model of the feasibility frontier using the familiar possible worlds technology. I then show that this model has significant methodological implications for political philosophy. On the Target View, a political ideal (...) presents a long-term goal for morally progressive reform efforts and, thus, serves as an important reference point for our specification of normative political principles. I use the model to show that we can- not reasonably expect that adopting political ideals as long-term reform objectives will guide us toward the realization of morally optimal feasible states of affairs. I conclude by proposing that political philosophers turn their attention to the analysis of actual social failures rather than political ideals. (shrink)

Numerous philosophers allege that the "general theory of second best" (Lipsey and Lancaster, 1956) poses a challenge to the Target View, which asserts that real world reform efforts should aim to establish arrangements that satisfy the constitutive features of ideal just states of affairs. I demonstrate two claims that are relevant in this context. First, I show that the theory of second best fails to present a compelling challenge to the Target View in general. But, second, the theory of second (...) best requires ideal theorists to undertake certain kinds of causal and comparative analyses that are typically thought to lie beyond the borders of conventional ideal theory. (shrink)

Abstract Contrary to Peter J. Boettke's essay, ?What Went Wrong with Economics??, there is no connection between ?formalism? and the alleged inability of mainstream economists to regard theoretical models as anything other than either depictions of real market economies or bases for criticizing market economies and justifying government intervention. Although Boettke's criticisms of the excesses of formalism are justified, Austrian economists such as Boettke need to justify their view that government interventions into economic affairs are inevitably harmful.

It is conventional wisdom among political philosophers that ideal principles of justice must guide our attempts to design institutions to avert actual injustice. Call this the ideal guidance approach. I argue that this view is misguided— ideal principles of justice are not appropriate "guiding principles" that actual institutions must aim to realize, even if only approximately. Fortunately, the conventional wisdom is also avoidable. In this paper, I develop an alternative approach to institutional design, which I call institutional failure analysis. The (...) basic intuition of this approach is that our moral assessment of institutional proposals is most effective when we proceed from a detailed understanding of the causal processes generating problematic social outcomes. Failure analysis takes the institutional primary design task to be obviating or averting institutional failures. Consequently, failure analysis enables theorists to prescribe more effective solutions to actual injustice because its focuses on understanding the injustice, rather than specifying an ideal of justice. (shrink)

Implicit in feminist and other critiques of ideal theorizing is a particular view of what normative theory should be like. Although I agree with the rejection of ideal theorizing that oppression theorists (and other theorists of justice) have advocated, the proposed alternative of nonideal theorizing is also problematic. Nonideal theorizing permits one to address oppression by first describing (nonideal) oppressive conditions, and then prescribing the best action that is possible or feasible given the conditions. Borrowing an insight from the "moral (...) dilemmas debate"— namely that moral wrongdoing or failure can be unavoidable—I suggest that offering (only) action-guidance under non-ideal conditions obscures the presence and significance of unavoidable moral failure. An adequate normative theory should be able to issue a further, non-action-guiding evaluative chim, namely that the best that is possible under oppressive conditions is not good enough, and may constitute a moral failure. I find exclusively action-guiding nonideal theory to be both insufficiently nonidealizing (because it idealizes the moral agent by falsely characterizing the agent as always able to avoid moral wrongdoing) and meanwhile too strongly adapted to the nonideal (because normative expectations are lowered and detrimentally adapted to options that, while the best possible, are still unacceptable). (shrink)

Human cognition requires coping with a complex and uncertain world. This suggests that dealing with uncertainty may be the central challenge for human reasoning. In Bayesian Rationality we argue that probability theory, the calculus of uncertainty, is the right framework in which to understand everyday reasoning. We also argue that probability theory explains behavior, even on experimental tasks that have been designed to probe people's logical reasoning abilities. Most commentators agree on the centrality of uncertainty; some suggest that there is (...) a residual role for logic in understanding reasoning; and others put forward alternative formalisms for uncertain reasoning, or raise specific technical, methodological, or empirical challenges. In responding to these points, we aim to clarify the scope and limits of probability and logic in cognitive science; explore the meaning of the explanation of cognition; and re-evaluate the empirical case for Bayesian rationality. (shrink)

Severity of Test (SoT) is an alternative to Popper's logical falsification that solves a number of problems of the logical view. It was presented by Popper himself in 1963. SoT is a less sophisticated probabilistic model of hypothesis testing than Oaksford & Chater's (O&C's) information gain model, but it has a number of striking similarities. Moreover, it captures the intuition of everyday hypothesis testing.

This is a comprehensive anthology of works concerning the nature of economics as a science, including classic texts and essays exploring specific branches and schools of economics. Apart from the classics, most of the selections in the third edition are new, as are the introduction and bibliography. No other anthology spans the whole field and offers a comprehensive introduction to questions about economic methodology.

Corporate Strategy has emerged as a central metaphor for private-sector enterprise. Given inherent imperfections in markets, one important question to consider is how well the practice of Corporate Strategy contributes to social welfare. An account of the implicit morality of free markets is developed as a standard against which two particular, second best solutions to market imperfections — namely, American federal antitrust policy and Corporate Strategy — are compared. Corporate Strategy is subsequently evaluated in terms of the fundamental principles of (...) Rawls' theory of justice. In both analyses, Corporate Strategy is found to depart significantly and systematically from the standards of social justice. An alternative principle, grounded in the concept of duty, is introduced as a means for reconceptualizing Corporate Strategy. (shrink)

My aim in this paper is twofold. First, I challenge the view that ideal normative principles offer appropriate guidelines for our efforts to identify morally progressive institutional reform strategies. I shall call this view the "ideal guidance approach." Second, I develop an alternative methodological approach to specifying nonideal normative principles, which I call the "failure analysis approach." I contrast these alternatives using examples from the global justice literature.

What is the nature of moral behavior? According to the study of bounded rationality, it results not from character traits or rational deliberation alone, but from the interplay between mind and environment. In this view, moral behavior is based on pragmatic social heuristics rather than moral rules or maximization principles. These social heuristics are not good or bad per se, but solely in relation to the environments in which they are used. This has methodological implications for the study of morality: (...) Behavior needs to be studied in social groups as well as in isolation, in natural environments as well as in labs. It also has implications for moral policy: Only by accepting the fact that behavior is a function of both mind and environmental structures can realistic prescriptive means of achieving moral goals be developed. (shrink)

Few issues in business ethics are as polarizing as the practice of risk classification and underwrit­ ing in the insurance industry. Theorists who approach the issue from a background in economics often start from the assumption that policy-holders should be charged a rate that reflects the ex­ pected loss that they bring to the insurance scheme. Yet theorists who approach the question from a background in philosophy or civil rights law often begin with a presumption against socalled “actuarially fair” premiums (...) and in favor of “community rating,” in which everyone is charged the same price. This paper begins by examining and rejecting the three primary argu­ ments that have been given to show that actuarially fair premiums are unjust. It then considers the two primary arguments that have been offered by those who wish to defend the practice of risk classification. These arguments overshoot their target, by requiring a “freedom to under­ write” that is much greater than the level of freedom enjoyed in most other commercial transac­ tions. The paper concludes by presenting a defense of a more limited right to underwrite, one that grants the legitimacy of the central principle of risk classification, but permits specific deviations from that ideal when other important social goods are at stake. (shrink)

This paper examines and rejects two normative justifications for low-fee private schools, whose expansion throughout the Global South in recent years has been significant. The first justification – what I shall call the ideal thesis – contends that LFPS are the best mechanism to expand access to quality education, particularly at the primary level, and that the premise of their success is that they reject educational equality and state intervention in educational affairs, traditionally associated with public schools, embracing instead educational (...) adequacy and unregulated markets for education. Against this thesis, the paper argues that an ideal educational arrangement must not do away with educational equality and some degree of state interference. The other justification for LFPS – the secondbest thesis – contends that although LFPS do not represent the ideal state of affairs, they nonetheless bring us a step closer to the ideal of universal primary education; they are a ‘realistic’ approximation to that goal. Against the second-best thesis, the paper argues that this justification commits the approximation fallacy: by deviating from the ideal educational arrangement LFPS may obstruct rather than facilitate its achievement. (shrink)

Our world is complex—it is composed of many interacting parts—and this complexity poses a serious difficulty for theorists of social reform. On the one hand, we cannot merely work out ways of ameliorating immediate problems of injustice, because the solutions we generate may interact to set back the achievement of overall long-term justice. On the other, we cannot supplement such problem solving with theorizing about how to make progress towards a long-term goal of ideal justice, because the very interactions that (...) render problem solving unsatisfactory raise insurmountable epistemic difficulties for this latter approach. To accommodate complexity, we must therefore give up on ideal theory, and instead supplement problem solving with a new sort of theorizing that aims to work out how to make our institutional arrangements more progressive: more conducive to further improvements in general, though not necessarily to the achievement of any antecedently specified goal. More concretely, we must identify ways of improving our capacity to flexibly experiment with many promising solutions to problems as they arise, to select for those solutions that prove successful while eliminating those that do not, and to learn from both our successes and our inevitable failures. (shrink)

Moriarty argues that the Market Failures Approach to business ethics is inapplicable to “real world” problems, because it treats “market failure” as a failure to achieve Pareto efficiency. Depending upon how it is applied, Pareto efficiency is either trivially easy to satisfy or else so demanding that no real-world market could ever satisfy it. In this Commentary, I argue that Moriarty overstates these difficulties. The regulatory structure governing markets is best understood as an attempt to maximize the number of Pareto-improving (...) exchanges that occur. There is no reason to think business self-regulation cannot be guided by the same normative-conceptual framework. (shrink)

Etye Steinberg has recently raised a problem for Joseph Heath’s Market Failures Approach. In this paper we consider a response by Heath. We argue that Heath’s response not only leaves the original problem intact, but also raises a second one, analogous to stakeholder theory’s so-called “identification problem.”.

Joseph Heath (2014) argues that the contribution of competitive markets to Pareto-efficiency generates moral constraints that apply to business managers. Heath argues that ethical behavior on the part of management consists in avoiding profit-seeking strategies which, under conditions of perfect competition, would decrease Pareto-efficiency. I argue that because (1) such conditions do not obtain; and (2) the most efficient result – under imperfect conditions – is not achieved by satisfying the largest possible set of the remaining conditions; it is (3) (...) impossible to draw any substantive ethical guidelines from Heath’s approach. (shrink)