Loving Free Markets and Proper Restraints

The field of economics is a wonderful tool for understanding a limited body of knowledge.  In our imperfect world, I almost always prefer that markets be free to set prices and create wealth.

However, if we broaden the scope of what we think economics can tell us about the world, then we run into problems. When we champion economic liberty over and apart from the restraints of virtue, we broaden that scope.

We do this in part, Mark Shiffman argues, because we detach economics from normative reality.  Shiffman believes that Thomas Hobbes was the first person to develop the idea of economics beyond its original purpose of judicious management of household goods.

I think that as people tend to believe that virtue is self-defined, they will be more supportive of a non-normative view of economics.  If virtue is an individually defined preference, then it will naturally take care of itself.

But if we think virtue is not so fluid, then we must use its restraints as we consider the guidance offered by economics.

For example, it might be advantageous for your career to work so often that you never see your spouse.  If he or she doesn’t like it, then you can just reenter the marriage market. But most economic models of marriage reduce spousal commitment to a temporary contract that changes with each person’s preferences.  You need the restraints of virtue to tell you that marriage doesn’t work with such a self-centered focus on your career.

We should be careful to avoid elevating the individual and choice in all cases.  We must restrain ourselves by balancing a love of liberty with a love of virtue, family, friendship, and community.

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