186. Commensurability and substitution

For the sake of rational calculation of optimal choice, economics assumes that everything can be brought together under the single measure of utility (‘commensurability’).[i]

I propose that one aspect of commensurability is that things are equivalent, can replace each other, or can ‘substitute for each other’, as economists say. More of the one can compensate for less of the other. Labour and capital can be substituted for each other in production, in more capital- or more labour-intensive production.

There is something similar in language. One criterion for two expressions to have the same meaning (in the sense of sameness of reference), is that they can replace each other in propositions while maintaining their truth. For (a classic) example, the proposition ‘the morning star is a planet’ remains true if we replace ‘morning star’ by ‘evening star’, since both expressions refer to the same planet: Venus.

Earlier in this blog (item 180) I proposed that often things cannot be added in a single measure. As an example I used ethical values, which led me to virtue ethics instead of utilitarian ethics, with multiple values and virtues that cannot all added or subtracted or traded off against each other.

There is another counterexample. The body requires calcium, vitamins, minerals, amino-acids, and oxygen, and those cannot replace each other. One needs some minimum of each. Living systems are geared to keep values of different items within boundaries. Aristotelian virtue ethics, with its striving for ‘the middle’ between extremes, does the same for ethics.

I discussed wholes and their parts in the preceding item of this blog. The point now is that wholes are seldom simple aggregates of their parts, but mostly compositions, structures of connections between them.

We can elaborate on this with the use of the notion of scripts that I used before in this blog (in item 35), as a composition of connected components called nodes. The nodes can represent activities in some action script. The example I used was that of a restaurant, with subsequent nodes of entry, eating, ordering, eating, paying and leaving.

Nodes may also denote words in a sentence, connected by grammar and syntax, or elements of a theory or argument, connected by logical inference. In the case of calcium, vitamins, etc. in the body: they fulfil different functions in the body script. The script may also represent an architectural composition, with elements connected by logics of use and of construction. I will return to this in a later item. It may represent connections of dependence, interests and rivalries in economic systems, as in industry structure. I will later return to that also.

Now I propose that things are commensurable to the extent that they are equivalent, can substitute for each other in the same nodes.

A node has a repertoire of different ways in which its function in the script can be performed (different ways of paying a bill, in the restaurant case). Those can substitute for each other. However, equivalence is a relative concept. Two things are equivalent relative to some higher script or purpose (the restaurant script). But they have different (sub)scripts of their own (paying cash, using a bank card).

Back to economics. Labour and capital may replace each other in achieving some volume and cost of production, but they entail very different production processes.

All consumer products (good and services) in some way or another satisfy some of a wide variety of needs and desires. In that sense they are commensurable, but to a very limited degree. Different products fit in different nodes in different user scripts, and as such they are largely incommensurable.

In other words, things that are equivalent for what is ‘brought about’ may not be equivalent in how this is done. We find that also in linguistics. Expressions may have the same extension/reference but not the same intension/sense, i.e. the way in which the reference is arrived at, given differences in knowledge, belief, experience, and values between people.

One might say: The assumption in economics that everything can be summed up in utility is senseless.    

 

---

[i] More strictly, the assumption is that everything can be brought together in preferences that satisfy axioms of completeness and consistency (in particular transitivity).