Dear Prudence, you're overrated

The Economics of Sin

January 9, 2004

The "dismal science" is uneasy about sin. In one sense economics is the very science of sin - the original sin that made for scarcity, loss of Eden and all our woe. And prudence, which is another item economics is the science of - well, prudence unalloyed is sinful all right. The single-minded "maximisation of utility" that so fascinates the modern economist, a maximising heedless of love or justice or temperance, is called, of course, avarice (or lust or gluttony among the seven deadly ones, depending on what field of excess you fancy).

But as Samuel Cameron observes, the modern economist has turned away from the virtues, except prudence, and denied that there are any sins.

"Absolute concepts (such as morality or justice)," he notes, "tend to become redefined out of existence," and we are left with merely "an objective cost-benefit analysis" of our impulses.

We wish to consume pizza, heroin, Range Rovers, prostitution, church weddings and adultery, that is all. The engine of "rational choice" ("rational" in a restricted sense) names all these as "goods". The consumer is sovereign. If she wants Barbara Cartland romances on holiday or three pints of bitter at lunch, that's an end of it. The only sin is inefficiency in getting them.

"There is no such thing as a moral or an immoral book," said Oscar Wilde at the beginning of the laissez-faire attitude towards behaviour: "Books are well written, or badly written." There is no such thing as a moral or immoral act of consumption, says the modern economist: acts of consumption are either consummated efficiently, or inefficiently.

The economist flees any judgement except for the cost-benefit analysis of prudence. Or rather he conceals his judgement, half-aware and uncriticised, in premises. The distinguished professor of American law and high-court judge Richard Posner, for example, argued in the fourth edition of his textbook Economic Analysis of Law that "some rapists derive extra pleasure from the fact that the woman has not consented. For these rapists, there is no market substitute... and it could be argued therefore (under the utilitarian premises Judge Posner adopts throughout) that... they... should not be punished if the sum of satisfaction to the rapist... exceeds the victim's pain." There is no such thing, judges the judge, as a backward-looking virtue of justice; no right to say no. Forward-looking prudence rules.

Maximise utility. Cost and benefit of rape. The page (and a good many more early and late in a distinguished career) will keep Posner off the American Supreme Court. A good thing: a judge who sees no point in justice or temperance or any virtue but the economist's prudence unalloyed is not to be encouraged.

"Economics and its metaphors of the market," Cameron avers, "are a vital part of the depersonalising, responsibility-removing process" that has left many without a sense of virtue or of sin. That seems right, although one might add that other and non-economic themes in modern culture have also removed responsibility.

The fall of religion did not make people better, always. The nature of man under socialism turned out to be worse than under capitalism. Seventy years of existing socialism (all right, state capitalism masquerading as socialism) was not better morally than a priest-ridden tsardom or a greedy capitalism.

So economists should think about sin. Cameron's book unhappily is not a very good start. Cameron, who is a reader in economics at the University of Bradford, has read a great deal, sometimes beyond economics, and is anyway something of an expert on the "sin industries" - cigarettes, prostitution, drinking, crime. Since the 1970s the "mainstream" of "neoclassical" economics (fighting words, both those) has followed the University of Chicago's great Gary Becker in applying maximising utility to activities other than buying and selling pizza and Range Rovers. I just attended a little conference on the economics of religion (in which Harvard University's Robert Barro told us that belief in hell was good for economic growth, but going to church was bad for it), to be followed by another larger one (where I fear I will get more "results" from econometrics applied mindlessly to materials the economist has no understanding of). The economic industry of studying unconventional industries has become conventional.

A book answering the question of the subtitle - is sin merely to be merged blamelessly into "rational choice" or is it to be viewed as an illness of the soul? - would be useful. But the book answers none of the questions it poses, and poses clearly very few.

It is hard for anyone, and seems so most of all for Cameron, to state the point of the book. I certainly cannot, although I searched and searched on your behalf. We arrive, for example, at the end of the long introduction mystified: we are to be told what economics "has to do with" sin (a vague enough theme, that); after 12 pages of backing and filling, mentioning and referring, we are no wiser. And so it goes on for the next 195 pages to the end.

Cameron's book is addressed to economists. I am an economist. I know the economic ideas of which he speaks. Yet for dozens of pages at a time I have no idea what the point is, and it adds up to nothing. Now I admit that such an experience is not rare in the modern literature of economics. Fiercely professional "work" by my colleagues - such as most of what passes for "theory" in economics practised at the University of Cambridge - can rarely answer the question "so what?" This is not because the mathematics is too hard for simpletons such as me (as shown by the case of Cameron's book, which has no maths). The lack of point in modern economics is much more serious than a mere lack of clarity.

Not that Cameron's book is clear. The writing indulges all the sins of academic prose: aimless "delving into" this or that side issue, excessive anticipations ("this chapter begins with") and summarisations ("in this chapter we have looked at"), even overuse of "this", "the process of", and the barbarism "and/or". Cameron writes about sin with a tiresome smirk. But I repeat: style and tone would cause no trouble if one could see what exactly the point was.

I am unhappy to be so negative. I am still more unhappy to indulge in the worst reviewing sin, that is, suggesting what the book should have been.

But the temptation in the present case is irresistible. The book should have set economics in a system of sin - and therefore a system of the virtues, because without an account of virtues there is no doctrine of sin.

It should have discussed the reborn tradition of "virtue ethics", begun in Aristotle, true, and perfected in Aquinas, but buried since the late 18th century under tons and tons of Kant and Bentham.

The system of the virtues has in the past 30 years been reborn of woman - female philosophers such as Elizabeth Anscombe, Philippa Foot, Mary Midgley, Iris Murdoch, Martha Nussbaum, Rosalind Hursthouse, Nel Noddings (a few men - Bernard Williams and Alasdair MacIntyre, for example - have assisted ably in the delivery). The women place prudence - as indeed the sainted Adam Smith did before Bentham fouled the nest - in the midst of other virtues.

That is how to evaluate consumption, and to decide whether reading Cartland novels while drinking a nice chilled Riesling on the beach is a sin: does it contribute to human flourishing? I myself am of the opinion that it does, if done with hope, faith, love, courage, justice, temperance, and a modicum of prudence.

Deirdre McCloskey teaches economics, history, English, communication and philosophy at the University of Illinois, Chicago, US. Her latest book is The Secret Sins of Economics .

The Economics of Sin: Rational Choice or No Choice at all?

Author - Samuel Cameron
Publisher - Elgar
Pages - 240
Price - £59.00
ISBN - 1 84064 867 8

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