Ethics Economics

3 Credits · Level: Graduate, Undergraduate

This course is an effort at interdisciplinary thinking about the possible conflicting demands of efficiency and justice. In a first section we will look at the history of economic thought We will start by studying Adam Smith’S arguments for efficiency while not overlooking Smith’s concern for the common good. Then we will read some crucial publications by neo-liberal economists who defend the role of the government so as to keep the free market efficient (anti-trust laws, banking regulations, etc.). Next we will read a couple of chapters in Marx’s Capital illustrating great injustices in the capitalist system. In a second section we consult current economic theory. We will begin by summarizing the requirements for economic efficiency, as defined by the economic profession (welfare economics). We will then present the economic argument for market failure, particularly in the case of public goods. With the concept of merit good we encounter the explicit ethical dimension in economic thought. This concept will allow us to articulate the problems of property rights, anti-trust legislation, subsidies for education and social legislation. In a third section we will look at philosophical reflections upon economics as done by either philosophers or philosophically inclined economists (e.g., Hegel, Rawls, Sen, Baier, Buchanan)The implementation of ethical principles takes place within the context of existing ethos pattern (Olson or Briefs). We will also study how religious ethics plays an important role in the implementation of social justice. In a fourth section we will look how the financial crisis of 2007/08 can be clarified by the ideas developed in the previous chapters. Readings: Ver Eecke, W. (2013). Ethical Reflections on thr Fiancial Crisis 2007/08. Making Use of Smith, Musgrave and Rajan. Heidelberg, New York: Springer Verlag. Ver Eecke, W. (Editor).(2007). An Anthology regarding Merit Goods. The Unfinished Ethical Revolution in Economic Theory [Compiled with Commentary by Wilfried Ver Eecke]. West Lafayette: Purdue University Press. (This book is available at very reduced price in Amazon.com). A number of articles by economists, philosophers, and social scientists will be put on reserve in the library or made available electronically. There will be three take home exams, blackboard discussions and a research paper. For undergraduates the research paper is expected to be 5 pages. For graduates the research paper is expected to be between 15 and 20 pages.