“There is nothing so absurd which has not sometimes been asserted by some philosophers.”
-Cicero, De Divinatione, ii, 58.
And hence it is, that to feel much for others and little for ourselves, that to restrain our selfish, and to indulge our benevolent affections, constitutes the perfection of human nature; and can alone produce among mankind that harmony of sentiments and passions in which consists their whole grace and propriety.
-Adam Smith, Theory of Moral Sentiments, p. 25.
That sentence is more important to understanding how markets work than most people realize. The ability to feel empathy is part of what makes us human. It is also what makes market economies possible.
Without empathy, killing the customer would be at least as common as serving him. Mutual exchange — trade — is an act of peace. That wouldn’t be possible without the human ability to put ourselves in others’ shoes and feel for them. After all, it’s a lot easier to hit someone and take their stuff. And yet few people do. Empathy is a big reason why.
Adam Smith was one perceptive guy. Others have filled in gaps in his thought, and proven him wrong on some details. That does not take away from the fact that he was as perceptive as any thinker in history.
Posted in Economics, Great Thinkers, Philosophy
Tagged adam smith, benevolence, Economics, enlightenment, liberalism, market economies, market process, peace, Philosophy, scottish enlightenment, selfishness, sentiments, theory of moral sentiments, Trade, war
Before there were lawyers, there were philosophers. The Sophists, given a bad name by Plato, earned their bread by teaching people how to plead their cases in court. There being no professional lawyers in 5th century B.C. Athens, people had to represent themselves. Witness this tale (probably too good to be true) of the pre-Socratic Greek philosopher Protagoras:
It is said that [Protagoras] taught a young man on the terms that he should be paid his fee if the young man won his first law-suit, but not otherwise, and that the young man’s first law-suit was one brought by Protagoras for recovery of his fee.
Bertrand Russell, History of Western Philosophy, p. 75.
Posted in Books, General Foolishness, Great Thinkers, History, Philosophy, Pith
Tagged ancient greece, ancient philosophy, athens, bertrand russell, greece, greek philosophy, History, history of western philosophy, Philosophy, plato, protagoras, western philosophy
When Niccolo Machiavelli died in 1527, Washington, DC was still more than two and a half centuries away from being founded. But he understood perfectly how that dismal city would work, as Bertrand Russell reminds:
“In the absence of any guiding principle, politics becomes a naked struggle for power; The Prince give shrewd advice as to how to play this game successfully.”
-Bertrand Russell, History of Western Philosophy, xxii-xxiii.
Machiavelli was, in many ways, the first modern public choice theorist. Had he lived in a post-Adam Smith world, he would have made a fine economist. A politician’s guiding principle is usually not ideology. It is to remain in power. So they behave accordingly. The first lesson of economics is that people respond to incentives. If someone’s incentive is to get re-elected, they will behave in a way conducive to achieving that goal. Morality and the greater good compete for a distant second.
Posted in Books, Great Thinkers, Pith, Political Animals, Public Choice
Tagged bertrand russell, Great Thinkers, machiavelli, Philosophy, the prince, washington, washington dc
Think for a minute about how progress is made. It doesn’t follow a constant, linear path. It is unpredictable. It comes in violent fits and starts. It happens at the whim and fancy of genius.
Everyday life is much the same. Life is what you make of it. You have to be free to find what’s best for you. That means making wrong choices sometimes. It means not just trial, but error. Or, as Hayek put it:
“If we knew how freedom would be used, the case for it would largely disappear… It is therefore no argument against individual freedom that it is frequently abused.”
-F.A. Hayek, The Constitution of Liberty, p. 31.
Posted in Economics, Great Thinkers, Philosophy
Tagged constitution of liberty, Economics, f.a. hayek, fa hayek, freedom, friedrich a hayek, friedrich hayek, hayek, liberty, Philosophy
Gibbon’s Decline and Fall begins with the death of Marcus Aurelius in 180 AD. It was all downhill from there.
Besides being a well-regarded emperor who was succeeded by an ill-regarded son, Marcus was a philosopher. Reading the works of Epictetus turned him into a devoted stoic as a young man. Marcus’ book Meditations remains the sterling example of the stoic mindset: civility, moderation in all things, and above all, taking triumph and tragedy with the same quiet dignity.
Marcus also had a bit of the economist in him. Despite predating Adam Smith by sixteen centuries, Meditations contains an excellent example of opportunity costs. Only the law of demand is more important in the economist’s toolkit. As a way of saying “mind your own business,” he writes:
Do not waste what remains of your life in speculating about your neighbours, unless with a view to some mutual benefit. To wonder what so-and-so is doing and why… means a loss of opportunity for some other task.*
*Meditations, III.4; trans. Maxwell Staniforth.
Posted in Books, Economics, Great Thinkers, History, Philosophy
Tagged adam smith, commodus, decline and fall, Economics, edward gibbon, epictetus, gibbon, marcus aurelius, meditations, opportunity costs, Philosophy, stoic, stoicism
John Stuart Mill was born on this day in 1806. He is best known for classical liberal writings like On Liberty and The Subjection of Women. College students today also learn about his philosophy of utilitarianism, inherited from father James Mill and family friend Jeremy Bentham.
Mill had an unusual life story, told in one of the most compelling autobiographies in literature. John’s father gave him an intensive education that, for example, had him reading ancient Greek at age three. John never had any formal schooling, and the only children with whom he was allowed contact were his siblings.
His father’s pedagogical experiment worked in that it gave John one of the most formidable intellects of his age. But it failed in other ways. His strict upbringing resulted in a nervous breakdown at age 20 that set him back years. He was always socially awkward, and didn’t marry until age 45 — itself an interesting story.
Mill made important contributions to economics, political science, and philosophy. A deep love of liberty runs through them all. I don’t personally agree with everything he wrote (utilitarianism leads to absurd conclusions when taken too far), but he remains one of brightest lights in the classical liberal pantheon. Happy birthday, John Stuart Mill.
(Cross-posted at Open Market)
Posted in Economics, Great Thinkers, History, Philosophy
Tagged 1806, autobiography, Economics, j.s. mill, john stuart mill, js mill, liberty, on liberty, Philosophy, political science, subjection of women, utilitarianism