The moral foundation of economic behavior

284 Pages·2014·1.788 MB·English

by  Rose, David C

Th e Moral Foundation
of Economic Behavior
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Th e Moral Foundation of
Economic Behavior
BY DAVID C. ROSE

1
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Copyright © 2011 by Oxford University Press
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Library of Congress Cataloging-in-Publication Data
Rose, David C.
Th e moral foundation of economic behavior / by David C. Rose.
p. cm.
Includes bibliographical references and index.
ISBN 978-0-19-978174-4 (cloth : alk. paper)
1. Economics—Moral and ethical aspects.
2. Cooperation. I. Title.
HB72.R656 2011
174—dc22 2010051996

1 3 5 7 9 8 6 4 2
Printed in the United States of America
on acid-free paper
For Angela, Matthew, and Christopher
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CONTENTS
Preface ix
Acknowledgments xiii
1
. Introduction
CHAPTER 3
2
. Opportunism
CHAPTER 18
3
. Group Size
CHAPTER 39
4
. Moral Values
CHAPTER 59
5
. Harm-Based Moral Restraint
CHAPTER 81
6
. Th e Empathy Problem
CHAPTER 96
7
. Duty-Based Moral Restraint
CHAPTER 114
8
. Th e Moral Foundation
CHAPTER 135
9
. Trust
CHAPTER 158
10
. Culture
CHAPTER 180
11
. Conclusion
CHAPTER 204
Notes 223
References 241
Index 255
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PREFACE
Most people believe that being moral is an important part of a life well-lived and
a healthy moral climate is a hallmark of a fl ourishing society. Today there is even
a cottage industry for the character and morals education of children. Th ere has
always been religious moral instruction, of course, but this is diff erent—it is not
about God or any particular religious narrative. It is instead an attempt to improve
society by inculcating specifi c moral values and by improving moral decision
making.
But how much do we really know about the connection between morality and
the functioning of human societies? Before we begin imparting moral values and
coaching moral decision making in an eff ort to produce a better society, shouldn’t
we fi rst think carefully about how morality might actually aff ect the functioning
of societies? And since a society’s economic system has so much to do with how it
functions and to what ends, doesn’t this require an examination of the connec-
tion between economics and morality?
A natural place to start in addressing these questions is to think carefully
about the connection between morality and economic behavior. Th at is the pur-
pose of this book. In this book it is the concept of trust that connects morality to
economic behavior. Of course conjecturing that trust is related to morality is
hardly surprising since nearly everyone believes that behaving in an untrust-
worthy way is immoral. But conjecturing that trust is related to economics is not
so obvious.
Although many social scientists now believe that trust is an important ele-
ment of economic behavior, there are thoughtful detractors to this position. Th ey
deserve and will get a full response to their concerns, so I ask those of you who
count yourselves among them to keep reading. Indeed, the fi rst task I undertake
in this book is to show precisely how trust can positively aff ect the operation of a
market economy. In addition to reviewing the familiar arguments, I introduce a
new one based on the ideas of Friedrich A. Hayek and Ronald Coase. It involves
combating a particular form of opportunism that has not received attention from
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