Monday, June 8, 2015


201. How to proceed with this blog?

I will continue to elaborate on themes discussed earlier in this blog. I will discuss economics and markets in some detail. In particular, I will explore the connections between economics and the various philosophical themes discussed in this blog: knowledge and discovery, ethics and morality, identity, self and other, collaboration and competition, trust, altruism and egotism, meaning and language, culture and society, and, above all, change.

My treatment of economics will be far from textbook economics. Traditional, mainstream economics is built on assumptions of rational choice, the autonomous individual, and optimal or equilibrium outcomes. I go against all of those, as I have done before, in this blog.

Rational choice is severely limited by unconscious motives of behaviour, with little free will, and by ‘radical uncertainty’ where one cannot calculate risks because the set of things that may happen is open, and preferences shift in the process of making and enacting choices. What can happen and what one wants follow choice as much as they precede it. This connects with the themes of knowledge and change.

The individual is constituted by genes in interaction with experience, especially interaction with other people. He/she develops his/her intellectual and emotional identity along a unique path of life. This yields variety of cognition, in what I have called çognitive distance’.

Our genes carry instincts of both self-interest and altruism that can be aligned or in conflict. Individual identity has multiple, often muddled, and shifting elements. Identity is more a network phenomenon than some essence that one contains. And in this we find the connection between individual and cultural identity. Here, I will explore the connections between economics, networks, and identity.

Processes of cognition, evaluation and action never achieve intended goals, and shift as a function of obstacles or novel opportunities encountered on the way. That is the pragmatist perspective that I have adopted in this blog. Equilibrium outcomes may be analytically useful as benchmarks but are never actually achieved. Life is, as I called it, imperfection on the move.

The challenge is to sort out how this all works out in a renewed view of economics and markets. Here I use a book that I published in 2014: How markets work and fail, and what to make of them (Edward Elgar).[i]

I am against fundamentalist market ideology, but I am not against markets. We could not do without them. But they work imperfectly. They often fail, and not only in the ways that economists realize. There are areas where markets should not be permitted to go. In other areas they may make sense but yield more perverse than useful effects. Above all, in markets there is, or should be, not only competition but also collaboration. There is need for both trust and control, without trust becoming blind. This ties in with the themes, in this blog, of self and other, collaboration, and trust.

I will argue that for a new economics the utilitarian ethics adopted, mostly tacitly, in present economics, should be replaced by a virtue ethics, inspired by that of Aristotle, but with some important twists, as discussed in this blog. There are multiple virtues and values, which cannot always be brought under a single measure. This is another obstacle to the calculation of optimal choice.


[i] The book is ridiculously expensive, but a cheaper paperback edition will appear in August.

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