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Ethics and Markets

These papers are concerned with the ethical character of market economies, especially in the domain of production, and with the implications of this for liberal political theory. They follow on from, but can be read independently of, my previous work on market boundaries.

The term 'ethical' is used throughout to denote what liberal theorists refer to as questions about 'the good' as distinct from 'the right'. Neutralist liberals have argued that ethical considerations should be excluded as a basis for state action; in addition, it is often claimed that market economies satisfy the requirements of such ethical neutrality. Both views are rejected in these papers, but without rejecting other central tenets of liberal political thought.

Several of the papers make use of literature in comparative political economy on different kinds of capitalism, and attempt to show how these institutional differences have significant ethical dimensions. They also address more generally the critical implications of institutional economics for the influential theoretical alliance between neutralist liberalism and neo-classical understandings of the market.

Full bibliographical information is provided in the initial footnote of each paper, and this should be used in any citations.



Markets, Firms and Practices 2000
This paper questions Alasdair MacIntyre’s view that market economies are incompatible with the conduct of production as a practice, with internal goods and standards of excellence. It argues that the extent to which markets are practice-antithetical is quite variable, depending on institutional factors whose significance is concealed by neo-classical economic theory. MacIntyre’s linking of practices exclusively to local communities, and the low value that his theory places on modern consumption, are also criticised. (The argument is developed further in ‘Practices, Firms and Varieties of Capitalism’ (2008)).


Consumer-Friendly Production or Producer-Friendly Consumption? 2000
In The Market Experience, Robert Lane argues that in tending inherently to prioritise consumption-benefits over production-benefits, market economies sacrifice greater goods for lesser ones. Although sympathetic to Lane’s emphasis on the (potential) goods of production, this paper argues, first, that in the case of certain cultural ‘products’, there is no necessary antithesis between consumer and producer benefits; and second, that certain kinds of consumption make it possible to enjoy the kinds of benefits that Lane regards as available only through production ‘at its best’.


Every Economy is a Moral Economy 2004
The significance of the ethics-morality distinction for debates in moral economy is explored in this paper. In ‘The Idea of the Moral Economy’, William Booth rejects Karl Polanyi’s view that market economies are uniquely non-moral systems, but also suggests, in effect, that they are distinctively non-ethical. This latter claim is rejected here: it is argued that market economies can be seen as both moral and ethical, with respect to exchange, consumption and production. (The argument is developed and refined in Market Economies as Moral Economies (2012) below).


Liberalism, Neutrality and Varieties of Capitalism 2006
Market economies are sometimes justified by liberal theorists on the grounds of their unique consistency with state neutrality. This paper challenges that justification by drawing on recent work in comparative political economy to argue that (state-supported) institutional differences between ‘varieties of capitalism’ significantly affect the possibilities for realising particular conceptions of the good. It argues also for a liberal perfectionism, according to which ethical considerations have a legitimate place in political decisions, subject to liberal constraints.


Choosing between Capitalisms: Habermas, Ethics and Politics 2007
In Between Facts and Norms and related writings, Habermas departs from his earlier position by accepting a place for ethics in political deliberation. Whilst welcoming this shift, this paper criticises Habermas’s conceptualisation of ethics in terms of individual and collective identity and self-understanding, and contrasts this with a broadly Aristotelian alternative. The two rival views of ethics are explored through their implications for how political choices between different kinds of capitalism should be conceived.


Ethics or Morality? Habermas on European Identity 2007
This paper argues that Habermas’s recent attempts to delineate a common ‘European identity’ point to serious problems in his conception of ethics and its place in political reasoning. Given the close connection he asserts between identity and ethics, it is surprising to find that what he regards as the main elements of European identity are moral rather than ethical. The only exception is the distinctively ethical nature of the contest he depicts between neo-liberal and social models of capitalism, but his account of ethical reflection provides no means of resolving this.


Ethics, Markets and MacIntyre 2008
This paper proposes certain revisions to MacIntyre’s theory of practices, institutions, and their respective kinds of goods, and argues that, thus revised, the theory does not straightforwardly imply the rejection of market economies. MacIntyre’s conception of politics as centrally concerned with common goods and human flourishing is endorsed, but his view that these can be achieved only in ‘local communities’ is criticised, along with his tendency to downplay the value of key principles of political liberalism that are not, it is argued here, incompatible with a perfectionist politics.


Practices, Firms and Varieties of Capitalism 2008
This paper draws on the ‘varieties of capitalism’ literature to question Alasdair MacIntyre’s view that capitalist market economies are incompatible with the conduct of economic production as a practice. It argues that although this may be so for ‘liberal’ market economies such as the USA and UK, the institutional arrangements of ‘coordinated’ market economies such as Germany are quite favourable to production as a practice. (This develops further the argument presented in ‘Markets, Firms and Practices’ 2000).


Social Criticism and the Exclusion of Ethics 2008
Despite the principled exclusion of judgments about the human good in both liberal political theory and critical social theory, it is argued here that both Rawls’s Theory of Justice and Habermas’s Theory of Communicative Action contain largely unnoticed elements that imply the legitimacy of evaluating economic institutions in ethical terms: in the former, through the concept of social union as a preferred alternative to private society; in the latter, through the inherently ethical character of the concept of colonisation. Consideration is also given to the role of social science in social criticism.


Anti-perfectionism, Market Economies and Meaningful Work 2009
In 'Meaningful Work and Market Socialism', Richard Arneson rejects any role for perfectionist ideals of meaningful work in political decisions about economic systems; instead, it should be left to the market to determine the extent to which such work is available. Against this it is argued here that market economies appear to be consistent with liberal neutrality only if theorised in neo-classical, rather than institutionalist terms; further, varieties of capitalism differ in the kinds of work they make available, and political choices between them should take account of these differences.


Market Economies as Moral Economies: The Ethical Character of Market Institutions 2012
This paper begins by criticising the view that market economies differ from their predecessors in lacking any normative character. It then argues that the evaluation of market economies must include specifically ethical judgments about the goods and ills that are institutionally linked to production, consumption and exchange, and that an institutionalist alternative to neo-classical economics is needed if the ethically relevant features of economic systems are to be identified and explained.


The Ethical Critique of Economic Institutions 2012
This paper defends Marx’s early writings against those who restrict social criticism to issues of justice and power, and argues for a specifically ethical critique of economic institutions in terms of the kinds of human goods and ills they hinder or promote. Questioning certain features of Marx’s ethical objections to markets, it suggests that MacIntyre’s concept of practices represents an ethically preferable ideal for production, and then draws on work in comparative political economy to identify some of the institutional requirements for a socialist market economy.


Contact Russell at: russell.keat@ed.ac.uk