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Project of Metaeconomics

We must restore ethical reflection to the heart of economic reasoning, re-center policymaking on the common good, and re-embed ethical education in economics and business programs. Economics emerged as a subbranch of moral philosophy, and it must return to its roots  (Annett, 2018)

The term Meta is often “used with the name of a discipline to designate a new but related discipline designed to deal critically with the original one” … (the Meta pointing to the need)  to “transcend… limitations” to “go beyond, transform it (Merriam-Webster)... (Project of Metaeconomics) …has always been consistent with the Leijonhufvud (2004) contention: “Instead of looking for an alternative to replace it (i.e., replace Single Interest Theory, SIT, in Microeconomics), we should try to imagine an economic theory to transcend its limitations….” (Lynne 2020, p. 158).

The overall Project of Metaeconomics is to bring ethical reflection back into economics, as Adam Smith originally proposed, working to transcend the fact Single Interest Theory (SIT) in mainstream Microeconomics has no placeholder for the ethic, the moral sentiments.  Adam Smith would not be pleased that the moral sentiment --- the ethic of the economic system --- was left out of the analytical system of economics.   As McCloskey argues "(Adam) Smith practiced 'humanomics,' an economics with the humans and their ethics left in (McCloskey and Carden, 2020, p. 176; also, see McCloskey 2021)."

 

Metaeconomics (Lynne 2020) is such an economics: It brings ethics back into view by introducing the other (shared ethic-based)-interest into a Dual Interest Theory (DIT), keeping self-interest primal, but now tempered by ethical reflection as represented in the shared other-interest.  Adam Smith would be a Metaeconomist, a MetaEcon, as Smith saw dual interest at play in Human nature: It was about seeking own-interest, made possible only by ethical (moral sentiments) tempering of self-interest, to bring the self-interest --- that of the Econ ---  down to something that the other can go along with (ethics). To Adam Smith, it was about striking good balance in the joint self & other-interest which gave form and content to the own-interest. Metaeconomics is about bringing economics back to its roots, seeing the Human not just the Econ, seeing the Human in a Humanomics not just an Econ in an Economics. 

 

By bringing science & ethics back into economics, it also makes for a Real World Economics not a Fantasyland and Imaginary World Economics (and, not just complaining about the latter as in the RWER, but building a Real World Economics framed by DIT in Metaeconomics).  It is about a Spaceship Earth Economics, seeing the Economy that provisions the Travelers as embedded withing the Spaceship system. It is about an economics for all the Travelers on the Spaceship flying around the Sun and through the Universe. 

As a result of bringing ethics back to center stage, and building on science & ethics,  the Project also resolves “the Adam Smith problem,” as in the integration of a joint Wealth & Sentiments.  And, it resolves the problems in  both the dominant Schools of Economics, including Chicago Economics applied to political economy, as represented in “the Chicago School problem” and “the Public Choice Theory/School problem.” It also corrects the course of The Chicago School of Law, which has put far too much attention to claiming SIT (self-interest only) also applies to the decision forum in the Court.  All said schools put all attention to self-interest, and downplay the role of the ethics represented in the shared other-interest. All said schools misrepresent Adam Smith, who saw the own-interest could not be achieved without the arrogance of self-love, the arrogance of self-interest only, being tempered by the ethic, as in a joint self & other-interest, joint self & widely shared ethic: "das Adam Smith" problem never existed. It was always about seeing the jointness in the Wealth (Smith 1776/1789) & Sentiments (Smith 1759/1790). See What is Dual Interest Theory for more details. 

 

Overall, the project is framed by the contention in Institutional Economics (and supported by testing of DIT using Behavioral Economics framing):  (Micro)Economics … is just political ideology in disguise” (Bromley 2019, p. 28, who also makes the point that the ethic is key, and sufficient reason must support any particular ethic that is chosen). That is, Microeconomics is an ideology of ego-based self-interest only (Single Interest Theory, SIT), and the narrowly defined ethic that supports only self-interest.  And, especially in the Chicago School, Libertarian application of it, economists using SIT with that framing are  “fiercely opposed to any ethical reflection whatever (McCloskey  2019, p. 93)."   Unfortunately, the typical Econ 101 course also is teaching ideology, in effect ignoring if not being outrightly opposed to ethical reflection.  Said courses need to be replaced by a MetaEcon 101 based in science & ethics, in effect, seeing the jointness, nonseparability, and interdependence of STEM & Humanities: It is time to rewrite the textbooks, bringing DIT into view, and, thus, putting economics back onto a foundation of science & ethics. 

 

Metaeconomics has the following features (Go To or Return To the Metaeconomics book overview page):

  1. Dual Interest Theory (DIT)  in Metaeconomics transcends the limitations of Single Interest Theory (SIT) which has become a political ideology, and returns economics to a facts (empirical, scientific-method sourced foundation for economics) & ethics-based endeavor.

  2. DIT builds on the notion that ethical reflection starts in mindful empathy-with the other, in the search for what the other can go along with (ethics).

  3. DIT sees ethics working to temper the self-interest, with outside (the person) influence --- sometimes needing regulation and control --- only necessary when self-control fails. 

  4. DIT  recognizes the Behavioral and Neuroeconomics (as well as Evolutionary Biology) science pointing to the dual (ego & empathy, self & other, selfishness & selflessness) nature of human nature.

  5. DIT brings ethics (extracted from economics with the move especially taking hold in the 1930s toward a mathematical economics) back into view within the analytical framework. 

  6. DIT shifts attention to maximizing the own-interest, reflected in the best balance in ego-based self-interest & empathy-based other-interest representing the ethic, requiring a bit of sacrifice (altruism) in each domain, with the best ethic a subject for inquiry in a joint consideration of facts (scientific method sourced) & ethics.

  7. DIT clarifies a balanced self&other-interest is essential to economic efficiency, to peace (minimal political and religious chaos), and, overall, to happiness.

  8. DIT focuses attention on the need for constant rebalancing of the self&other, I&We (as in Putnam and Garrett 2020), always in search of sufficient reason to choose a particular balance. 

  9. DIT  sees a key role for Government, replacing the  frame of Market VS Government with jointly arising Market & Government, giving analytical content to the notion  that “… classical liberals need to acknowledge the need for government, and get past the neoliberal era in which the state was demonized as an inevitable enemy of economic growth and individual freedom  (Fukuyama 2022, p. 146)." 

  10. DIT has a placeholder for community, religion, political ideology, and, in general, all institutions  and their transaction costs, each reflected in the shared other-interest.

  11. DIT is neutral to the position taken on any ideological and/or theological spectrum, while subjecting the search for the best position on the grounds of facts (scientific-method sourced) & ethics. 

  12. DIT is about pragmatism --- what works for real people, based in sufficient reason built on a foundation of facts (scientific-method sourced) & ethics --- and ethics are key.

References

Annett, Anthony.  “Restoring Ethics to Economics: Modern Economics Should Return to Its Roots.”  Finance and Development.  International Monetary Fund, March, 2018. https://www.imf.org/en/Publications/fandd/issues/2018/03/point2 )

Bromley, Daniel W. Possessive Individualism. Oxford University Press, 2019

Fukuyama, Francis. Liberalism and Its Discontents. Farrar, Straus and Giroux, 2022.”

Leijonhufvud, A. 2004. The Trento Summer School: Adaptive Economic Dynamics. In Economics Lab: An Intensive Course in Experimental Economics, ed. Daniel Friedman and Alessandra Cassar, 5–11. New York: Routledge, 2004.

Lynne, Gary D. Metaeconomics: Tempering Excessive Greed (Palgrave Advances in Behavioral Economics). New York: Palgrave MacMillan, Springer International Publishing. Kindle Edition, 2020.

McCloskey, Deirdre Nansen. Why Liberalism Works. Yale University Press, 2019.

McCloskey, Deirdre Nansen; Carden, Art. Leave Me Alone and I'll Make You Rich: How the Bourgeois Deal Enriched the World. Chicago: The University of Chicago Press, 2020. 

McCloskey, Deidre Nansen. Bettering Humanomics:  A New, and Old, Approach To Economic Science. Chicago: University of Chicago Press, 2021.

Putnam, R. D. and Garrett, S. R. The Upswing: How America Came Together a Century Ago and How We Can Do It Again. New York: Simon and Schuster, 2020

Smith, Adam. The Theory of Moral Sentiments. Edited by D.D. and A.L. Macfie Raphael. Indianapolis, Indiana: Liberty Fund, Inc., 1759/1790.

Smith, Adam. An Inquiry into the Nature and Causes of the Wealth of Nations. Edited by E. Cannan. New York: Random House, 1776/1789.

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