Historical Context and the Evolution of Economic Thought
Economics, originating in ancient Greece around 362 BCE, has traditionally been viewed as a social science focused on managing scarce resources to meet human needs. It wasn’t until Adam Smith, regarded as the father of modern economics, that the discipline began to be scientifically linked with philosophy, history, psychology, development, and most importantly, ethics. From Smith through Marx, Keynes, Cortina, Sen, Kahneman, and Tirole, economics has undeniably been intertwined with ethics, morality, and even emotions.
The Disconnect Between Economics and Morality
Economics, since its inception, has been closely associated with moral philosophy. However, neoclassical economics has distanced itself significantly from essential foundations such as human virtues, concepts of happiness, sympathy, and empathy, and ethics itself.
The focus has shifted from resource management to hoarding, overexploitation, excessive profit-seeking, and rampant speculation. Notably, the Nobel Prize has been awarded to economists like Milton Friedman, founder of the Chicago School (Chicago Boys), whose monetary expansion and state suppression doctrines have proven less efficient than claimed.
The Need for Ethical Economic Models
As the world grapples with rebuilding global economic architecture, addressing high inflation, mitigating the negative impacts of the COVID-19 pandemic, and narrowing the wealth gap, there is a pressing need to advocate for ethical development models within both academic and political spheres.
Returning to the fundamental precepts of moral philosophy in economic development would ensure that growth theories are more socially oriented, human-centered, and less driven by selfishness and indifference.
Current Global Economic Landscape
In the current historical context, with two major economic blocs led by the US and China amidst low growth, high prices, and geopolitical tension, there is an urgent call for an economy centered on human dignity. Such an economy would prioritize serving people rather than exploiting them, guided by the ethical principles that originated in the 18th century and remain relevant today.
The global community can no longer tolerate the enrichment of a few at the expense of many, particularly in technology and financial markets.
Key Questions and Answers
- What are the historical roots of linking economics with ethics? Economics has been intertwined with ethics since Adam Smith, with significant contributions from philosophers like Marx, Keynes, Cortina, Sen, Kahneman, and Tirole.
- How has modern economics distanced itself from moral foundations? Neoclassical economics has moved away from essential elements such as human virtues, concepts of happiness, sympathy, and empathy, and ethics itself.
- Why is it crucial to return economics to moral foundations? Returning to ethical development models would ensure that growth theories are more socially oriented, human-centered, and less driven by selfishness and indifference.
- What challenges does the current global economic landscape present? The world faces issues such as rebuilding global economic architecture, addressing high inflation, mitigating pandemic impacts, and narrowing the wealth gap.
- What kind of economy is needed in the current context? An economy centered on human dignity, prioritizing serving people rather than exploiting them, guided by ethical principles.
