The concept of preference dominates economic theory today. It performs a triple duty for economists, grounding their theories of individual behavior, welfare, and rationality. Microeconomic theory assumes that individuals act so as to maximize their utility – that is, to maximize the degree to which their preferences are satisfied. Welfare economics defines individual welfare in terms of preference satisfaction or utility, and social welfare as a function of individual preferences. Finally, economists assume that the rational act is the act that (...) maximally satisfies an individual's preferences. The habit of framing problems in terms of the concept of preference is now so entrenched that economists rarely entertain alternatives. (shrink)

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The connection between economics and ethics is as old as economics itself, and central to both disciplines. It is an issue that has recently attracted much interest from economists and philosophers. The connection is, in part, a result of the desire of economists to make policy prescriptions, which clearly require some normative criteria. More deeply, much economic theory is founded on the assumption of utility maximization, thereby creating an immediate connection between the foundations of economics and the philosophical literature on (...) utilitarianism and reasons for action. In fact, some influential contemporary approaches to ethics advocate decision-theoretic or game-theoretic foundations of some sort for moral principles, while several economic theorists are now prepared to take into account the ethical dimensions of rational decisions. As a result, it appears that economics and ethics are somehow inextricably linked through theories of rational decision-making. Most of us would probably find it disturbing to concede that there are contradictions between the prescriptions of rationality and the requirements of moral `rightness'. The essays included in the present volume provide a detailed analysis of the connections between ethics and economics as viewed from several different - sometimes conflicting - perspectives. This book, the outcome of a joint meeting of philosophers and economists, has three main themes: the validity of utilitarianism much used by economists, the notion of fairness and equity, and the coherence of the rationality postulate of economics. The book does not reach any final conclusions, but it greatly illuminates the exact areas of possible disagreement and indeed the open-ended nature of ethical reasoning. There is much that economists, and especially welfare economists, can learn from these papers - not least circumspection. (shrink)

Ever since Sen criticized the notion of internal consistency of choice, there exists a widespread perception that the standard rationalizability approach to the theory of choice has difficulties in coping with the existence of external norms. We introduce a concept of norm-conditional rationalizability and show that external norms can be made compatible with the methods underlying the traditional rationalizability approach. To do so, we characterize norm-conditional rationalizability by means of suitable modifications of revealed preference axioms that are well established in (...) the theory of rational choice on general domains as analysed in contributions by Richter and Hansson, for example. We compare our approach to alternative suggestions that have appeared in response to Sen's criticisms, and we discuss its links to Sen's notion of self-imposed choice constraints. (shrink)

While very much in Sen's camp in rejecting revealed preference theory and emphasizing the complexity, incompleteness, and context dependence of preference and the intellectual costs of supposing that all the factors influencing choice can be captured by a single notion of preference, this essay contests his view that economists should recognize multiple notions of preference. It argues that Sen's concerns are better served by embracing a single conception of preference and insisting on the need for analysis of the multiple factors (...) that determine ‘preference’ so conceived. (shrink)

Hobbes's central insight about ethics was that it should not be understood to require that we make ourselves a prey for others. It is this insight that both varieties of contractarianism [Hobbesian and Kantian] respect. Consider a relationship between two human beings that exists for reasons of either love or duty; let us also suppose that it is a relationship that can be instrumentally valuable to both parties. In order for that relationship to receive our full moral endorsement, we must (...) ask whether either party uses the duty or the love connecting them in a way that affects the other party's ability to realize the instrumental value from that relationship. To be sure, good marriages and good friendships ought not to be centrally concerned with the question of justice, but they must also be, at the very least, relationships in which love or duty are not manipulated by either party in order to use the other party to her detriment. (shrink)

I am most grateful to Elizabeth Anderson (2000), Philip Pettit (2000) and Thomas Scanlon (2000) for making such insightful and penetrating comments on my work and the related literature. I have reason enough to be happy, having been powerfully defended in some respects and engagingly challenged in others. I must also take this opportunity of thanking Martha Nussbaum, for not only chairing the session in which these papers were presented followed by a splendid discussion (which she led), but also for (...) taking the initiative, in the first place, to arrange the session. (shrink)

The volume concludes with a specially-written reply by Sen, in which he responds to his critics and provides a rich commentary on the preceding essays.

Why does Sen maintain that people are capable of putting their own goals offline and deliberating and acting out of sheer commitment to others? How can he endorse such a rejection of the belief-desire model of agency? The paper canvasses three explanations and favors one that ascribes an unusual position to Sen: the belief that so far as agents remain in the belief-desire mould, they cannot deliberate on the basis of reasons other than those that derive from standing goals that (...) form an integrated system. What he thinks of as deliberation on the basis of commitment is just the sort of deliberation that involves the formation of a novel, perhaps occasion-specific goal in which the good of another is prioritised. (shrink)