Metaeconomics Postscript

So, DIT (Dual Interest Theory in Metaeconomics) is an economic theory.  DIT works well in solving many if not all economic puzzles and paradoxes left without explanation by SIT (Single Interest Theory in Mainstream Microeconomics).  That power comes from the reality that the Human brain has evolved with two interests, two tendencies, two motives as described in self&other-interest.  It is about the two parts of the brain, each specialized, as in one focused on ego and the other on empathy, but in an integrated ego&empathy way.

As a result, DIT also gives new insights into the matter of meritocracy, and how it integrates with liberalism.  It clarifies how to resolve the problems with the meritocratic hubris and anxiety caused for people who make it to the top of the ladder of wealth and influence in a liberalism framed system, and the resentment and humiliation for the people who fail to make it up that ladder. It is ultimately about striking balance in the jointly operant ego-based self-interest and the empathy-based other-interest, said balance struck by every person no matter what rung on the ladder. 

DIT clarifies that meritocracy is a feature of all forms of economic liberalism --- including classical, progressive, free-market, and the egalitarian welfare state. How? Well, through the DIT lens, meritocracy is just another form of arrogance of self-love, the arrogance of self-interest only on path 0G in the DIT styled Figure 1. It causes hubris and anxiety in the people who choose that path 0G only trajectory and make to the top.  It causes resentment and humiliation for the people that try path 0G and fail to make progress on it. And, in both cases, it causes both economic and social inefficiency because of the exclusive focus on ego-based, meritocratic self-interest only. A meritocratic liberalism can bring efficiency only with attention to the shared with the other-interest.  Exclusive attention to a meritocratic self-interest with outcomes from that pursuit deemed to be somehow deserved ensures failure.

DIT clarifies that the fundamental idea of meritocracy focused individuals in all forms of liberalism --- both ordinary and the not so ordinary people --- need to also pay attention to the shared with the other-interest represented in the common good. It is about realizing that a substantive part of the talent with which one is endowed, and the ability to act on it with substantive effort, is fortuitous. It is a matter of luck, like the genetics available at birth, and what the market happens to value at the time a person starts to produce goods for it. And, even more importantly, the success from acting on talent and effort is heavily dependent upon a lot of other people, and the common good shared with said people. The common good matters.

So, given the fortuitous, luck dimension of merit, the optimal expression of it points to the need for striking a balance in merit&grace, the notion of grace referring to the fortunate outcome associated with the solidarity, sense of belonging with the other, the common good. So, DIT sees the key role of path 0M representing the common good in influencing the meritocratic conditioned pursuit of self-interest on path 0G, landing on the better path 0Z.

Perhaps most importantly, DIT clarifies the overall character of the kind of liberalism that most likely will work best. And, it is not new news: Adam Smith already laid out the basis of such a system, as in the original form of classical liberalism. The notion of meritocracy just adds to it, in that Adam Smith already saw the need to balance the self&other (shared with the other, and internalized)-interest, now given more understanding with the help of Sandel.  As the Tyranny of Merit: What’s Become of the Common Good? makes clear, and DIT confirms, it is essential to balance the merit&civic, individual&common good in that liberalism framed system.

Meritocracy is essential to success in liberalism  --- adding further insight into what classical liberalism is really about --- but it must be balanced, in that pursuing ego-based self-interest  in the exclusive focus on individual good only ensures liberalism fails. The empathy-based shared other-interest represented in the common good matters. Empathy matters.

And, a final note, empathy not only matters but it is key:  DIT points to the need to seek optimal inequality, which is the only just system.  Extreme, excessive inequality as caused by a meritocracy without empathy must be tempered.  Empathy is the only way to ensure the best overall economic performance. Meritocracy works counter to that essential need unless it is tempered by the common good. Empathy does that job. Optimal inequality means the meritocratic hubris at the top is reeled in, and the disdain for the people on the lower rungs is tamped down such that resentment is dissipated.  It is accomplished by empathy-with going every direction, up and down the ladder, by empathy-with the other on every rung. It is the only way to tamp down the Tyranny of Merit.

So, through the DIT lens:

Read the Sandel (2020) version as a story about Ego Merit, which is why the common good was damaged. Then, read the Sandel (2021) version, which is the rest of the story: It is about Empathy Merit, which is essential to finding the common good, and to bring it back into play.

Try DIT. You might like (D)IT.

References

Sandel, Michael. J. The Tyranny of Merit:  What's Become of the Common Good? Kindle ed. New York: Farrar, Straus, and Giroux, 2020.

Sandel, Michael J. The Tyranny of Merit:  Can We Find the Common Good? Paperback/Kindle. New York: Picador, 2021.