Metaeconomic (Economic) Growth is Jointly Material&Moral
We can also now clarify what we mean by economic growth, looking at the nature of Metaeconomic Growth. Neoclassical Economics, using the Microeconomics Framework (MF) and Single Interest Theory (SIT) would generally suggest that the Moral Dimension has to be sacrificed on path 0G (see What is Dual Interest Theory) to the fastest growth. So, we would not recycle, and we would tend, as B. Friedman (2006, p.7) says it, to “over-produce pollution, noise and congestion;” we would also tend to produce more externalities in the form of less fairness, tolerance, democracy, and opportunity (B. Friedman, 2006, p. 7). This leads to some intriguing views, as B. Friedman (2005; 2006, p. 8) points to, and about which Metaeconomics can provide new insights:
Someone who cares more about material concerns believes that he or she should be for economic growth, while someone who places greater emphasis on the moral dimensions of life instead is led to conclude that he or she should resist economic growth, and should oppose policies likely to spur growth.
Metaeconomics sees the first group on path 0G, and the second group on path 0M (again, see the isocurves figure in What is Dual Interest Theory). B. Friedman (2005; 2006, p. 8) goes on:
… economic growth brings benefits in the form of opportunity, tolerance, democracy and fairness… (as well as ways to resolve other externalities)… It is wrong, therefore, to structure the debate over economic growth as one of balancing purely material benefits versus purely moral drawbacks. The benefits are, importantly, moral as well. Similarly, the mapping of a person’s location on the spectrum from material concerns to moral concerns into his or her indicated stance in either favoring or resisting economic growth, and hence either supporting or opposing growth related policies, is a false mapping.
This is easily understood with the MEF, and, especially with the DIT analytical model. In particular, there is payoff in both domains of interest with no simple tradeoff (as required in MF and SIT) between the material and the moral; they cannot be separated into two separate sets of indifference curves. Rather, the material and the moral arise jointly on path 0Z . One needs to think of economic growth as both Material&Moral, at the same time, as they are joint, nonseparable entities, due to the nonallocable feature of the Material&Moral between the two interests, as indicated by overlapping isocurves. There is also the likely outcome of both being enhanced, at an increasing rate, as in possibility frontiers (see the possibillities frontier in What is Dual Interest Theory) becoming ever further apart, a symbiotic sum greater than the sum of the parts outcome. Both the Material&Moral are essential to good economic growth in a good capitalism.
Friedman, Benjamin M. The Moral Consequences of Economic Growth. New York: Alfred A. Knopf, 2005.
Friedman, Benjamin M. "The Moral Consequences of Economic Growth: The John R. Commons Lecture, 2006." The American Economist no. 50, 2 (2006):3-8.