Is economic competition morally defensible? It is to Johnathan Wolff’s credit that he asks this question in his paper The Ethics of Competition, given how much of our social interactions are driven by, depend upon and support economic competition.
When Tesco opens its new supermarket at the end of my road, it will put many local traders out of business. What is the difference between that and theft or arson?
Economists would point out that loss of patronage is merely a pecuniary externality. What the local traders lose by having to lower their prices their consumers gain. Competition leads to a redistribution of wealth, and since the local traders have no greater normative entitlement to wealth than the consumers (or Tesco for that matter), the change in the pattern of wealth distribution is morally neutral. Moreover, or so the argument goes, competition is likely to increase total welfare by forcing both local traders and Tesco to provide better value to their customers.
Wolff concedes the point that there are strong consequentialist justifications for economic competition, and so he turns his attention to non-instrumental justifications, which he finds unconvincing.
One argument made all too often is that competitive free trade is required by a proper respect for liberty. Anti-competitive situations are those in which certain people are prevented from doing something they want to do and this, so it is said, reduces their liberty. Therefore freedom requires free competition. This argument, however, is seriously flawed. Few claim we should have the liberty to harm each other. It is not a restriction on my (legitimate) liberty if I am prohibited from burning down your business premises. Yet harm suffered in economic competition can be just as serious. What we want to know is why one of these harms is permissible and the other not. A simple appeal to liberty cannot possibly help.
This argument itself is seriously flawed, because liberty, from a rights-based perspective, is not equivalent to simple freedom of action. Rather, it is rooted in a concept of autonomy or self-governance. If my store is put out of business by arson, I not only lose freedom of action but also autonomy. If my store is put out of business by lawful competition, I lose freedom of action but my autonomy remains unaffected. From a rights-based perspective, that’s a crucial difference. But is the distinction plausible? One morally important feature of competition that Wolff ignores is that most economic competition is competition for voluntary cooperation. In the absence of violence and coercion, the local trader earns his profits by enticing consumers to cooperate, that is, to enter into a contract with him. The trader’s gain depends on his continued ability to offer his customers a good deal, relative to all the other potential deals available to them. Thus, the trader’s enjoyment of profits (which, we have to assume are a condition of his keeping the store) depends on a series of free choices made by his customers. On grounds of autonomy, the trader has no right to require customers to contract with him. If the customers freely decide to buy at Tesco’s, they do not violate the trader’s autonomy. So while the trader loses his profits, no one’s autonomy or free choice to cooperate has been abridged. In contrast, if someone burns down the trader’s shop, he loses his property against his will. His continued enjoyment of the store in that respect is not based on the voluntary cooperation of others, unlike the trader’s expectation of profits from operating the store. It seems to me that therein lies a meaningful moral difference, which can be explained within the framework of a rights-based theory. I therefore don’t share Wolff’s pessimism in justifying economic competition on non-consequentialist grounds.
[tags]Wolff, competition, economics, consequentialism[/tags]
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I agree that freedom is at issue. But does the victim of arson lose their freedom of action? I think it’s proper to say that they lose their freedom of opportunity, but they presumably don’t suffer bodily damage, and so can perform whatever acts they like. I would emphasize that there is such a thing as freedom of opportunity, and argue that it’s at play here.
I’m not sure I understand what autonomy means. Is it freedom from coercion in performing an act? Or being given due respect for the dignity and agency of the person?
Freedom of action and freedom of opportunity (to take action) are both naturalistic accounts of freedom, where a state of freedom is defined by a set of options. If the pre-intervention set of options is greater or subjectively more valuable than the post-intervention set, then the intervention has diminished freedom. In contrast, I understand liberty as a normative, rights-based concept. Specifically, liberty is the result of both interpersonal and institutional recognition: we voluntarily concede everyone else a position identical to that from which such recognition originates, and we require the maintenance of the necessary conditions of such recognition. My point is that not every diminition of freedom of action and opportunity amounts to a loss of liberty. Losing my store to a competitor diminishes the former but not the latter. Losing the store to arson diminishes both.
I agree that something like the rights-based sort of account of liberty is a very morally significant account. But it seems to me that liberty itself is best described (in some part) in terms of that naturalistic account; for if we were to take a whole-hog normative account of liberty, we’d seem to be saying that liberty is necessarily morally significant; and it isn’t necessarily morally significant, as (I believe) the Frankfurt cases seem to show (at least with respect to the freedom to do otherwise). So I suppose we disagree about the character of ‘liberty’, or at least, the extent of its moral significance.
The upshot would just be that I’d want to talk about liberty in the rights-based sense with a few adjectival qualifications, as in, “social-moral rights and liberties”. So it’s not a radical divergence, as in one that would produce major theoretical and practical consequences (as far as I can tell); though it is a serious conceptual difference of opinion.
I would say that loss of my store to a competitor is a loss of liberty to sell things at my store; loss due to arson, the same. The real locus of concern, though, as you indicate, is whether or not the competition case is, in terms of morality and liberty, on the same plane as the arson case. I tend to agree with your conclusion: that the failed business case is competition for the opportunity to achieve voluntary cooperation of customers, as opposed to arson case where opportunities are involuntarily robbed of the actor.
Since we’re agreed, it might be worthwhile to take into account alternate opinions and see if they provide any other intuitions. I was watching Michael Moore’s “The Big One” the other night, and heard him make a comment that I really instinctually disliked. He compared the closing of the Flint car plant to acts of terrorism, noting how the consequences of both seem to be similar; the difference being that in the Flint case, it takes a while longer for death to occur, due to health problems associated with unemployment etc, while in a true terrorism case, people die instantaneously.
Moore, of course, has long been accused of being a rabble-rouser, non-intellectual, lacking nuance, etc. But the very same sentiment has been expressed by none other than Bertrand Russell in his book “Power: A New Social Analysis”, p. 147: “In democratic countries, the most important private organizations are economic. Unlike secret societies, they are able to exercise their terrorism without illegality, since they do not threaten to kill their enemies, but only to starve them.”
Maybe I don’t see the sharp line between the naturalistic and the rights-based account of liberty (or maybe there isn’t one), but aren’t the values of autonomy and self-governance simply criteria by which society selects those naturalistic freedoms of motion it deems most valuable? We have collectively evolved an array of subsistence practices that may be loosely termed ‘capitalism’ (as opposed to, say, feudalism), and we seek to maintain the necessary conditions of this system by force of law. This requires some trade-offs of raw freedom of action. So, for example, taking away my liberty to breach a contract is socially useful (and hence morally good?) because the firm expectation of enforceable agreements enables a certain set of socially useful behaviors that would otherwise be deterred, especially large-scale economic enterprises. I suppose similar forces are at work in the moral calculus of violent crime, in which restricting the freedom of action to kill or maim enhances an individual’s freedom of action to love, raise children, vacation, loafe, etc. This seems to be why the arson victim’s loss of certain freedoms of action does indeed translate into lost freedom of opportunity: certain enabling conditions have been destroyed by which certain opportunities could be more easily (and hence more probably) realized. Maybe a common mistaken belief is this: at time zero, every healthy individual is capable of anything (ie, has unlimited freedom of opportunity). But as long as interaction, and especiall cooperation, between people is a desirable form of living, we affirmatively create new opportunities (and hence new freedoms of action) out of thin air by denying other, less desirable freedoms of action.
Matt,
Yeah, it’s always a matter of how you define these things.
i) You express some sentiments that sound close to what I would agree with. The idea of “autonomy” is certainly not natural, as in inevitable. To show this, we might assume an optimistic-philosophical view of human nature, and demonstrate the chain of reasoning by which one may make one’s way toward a value of autonomy. In this story, first we have both a relatively natural idea of agency and incorrigibly see it as valuable; then, after we engage in social interaction, we create a normative consideration for human equality; and once we consider equality and agency together, we normatively construct a sense of individual dignity and autonomy. (A more negative and plausible story would diverge largely and provide more details, attributing mass belief to mere habits and power relationships. At any rate it makes no difference in reality, for the legal systems of Western cultures tend to at least pay lip service to autonomy, even if/when they run roughshod over it.)
However, when you suggest that “the values of autonomy and self-governance [are] simply criteria by which society selects those naturalistic freedoms of motion it deems most valuable”, you seem to be advocating a conventionalist view of autonomy; but conventionalism (as I imagine it, in this context) has its own problems. By a conventionalist’s account, I presume that one takes a list of the kinds of opportunities that the arbitrary person has open to them, and sort it into two piles: the “valuable” pile, and the “non-valuable” pile. Then, presumably, acts of autonomy would be considered to be those valuable opportunities, while non-autonomous acts would be susceptible to being blocked because of their irrelevancy.
Yet I see no reason why we couldn’t formulate a notion of autonomy which was morally inert, and corresponding situations where I can say a person is acting autonomously and is still prone to commit evil acts which the officer of the law is absolutely obliged to stop. Moreover, such an account just feels like it’s laying all the cards on the table, so to speak.
ii) Also, as you indicate, “freedom of opportunity” must be handled with care; sometimes it seems plausible to talk about counterfactual moral situations, and other times it’s just futile. IE: as a hedonistic utilitarian, I’ve been forced to consider why it is that murder is any problem at all when it comes to the victim, since the victim (being dead) wouldn’t be able to care one way or the next; and the natural move is to say, “Well, you’re robbing the victim of their opportunities for future pleasure, etc.” But in other cases, I may cause the loss of someone’s potential future happiness, like by selling certain stocks on the stock market which substantially lower the gains of Mr. So-and-so who was in dire need, and yet still seem to be engaging in morally permissible behavior.
But that is a complication, not a defeater — which should warn us against being overly simple, not to collapse this particular line of reasoning in its entire.
Ben,
1) I like the idea of “reverse-engineering” the value of autonomy in order to refute its ‘natural-ness’. Reading through your chain of reasoning, I’m struck by the possibility that this chain mirrors, at a high level of generality, the actual historical evolution of “autonomy” as a normative construct.
As a footnote, the notion of “equality” has often been a miserly one, normatively granted only to one’s fellow tribe, social class, or racial group. In the spirit of that qualification, I would posit that the normative construct of equality, which your chain roots in social interaction, should be rooted more specifically in affinities for individuals meeting an inherited set of criteria for fellow-feeling. I’m guessing that’s an example of what you meant when you said more plausible stories would incorporate the dynamics of power and habit.
2) The conventionalist account you gave doesn’t harmonize entirely with my understanding of the word “autonomy”. I don’t like the implication that a “master definer” a priori sorted valuable from worthless actions to arrive at a definition of “autonomy”. However, something akin to this process may have occurred through the social negotiation of meaning.
As an initial matter, the meaning of words can evolve radically over time. Assuming a word has some kind of meaning at time zero, original meaning gets infused with new sentiments and notions as the associative human brain notes similarities between a word’s meaning and other perceptual objects and communicates these observations to others. These objects get incorporated into the word’s denotation through usage over time.
[An example: At English common law, a widow could "disappoint" certain beneficiaries of her husband's will - up to a certain percentage of his total property - if he failed to leave her anything. Those beneficiaries were thus deprived of an expected benefit, and my guess is that use of the term inched its way over time, as individuals used the word metaphorically, into a generic denoter of the internal subjective state accompanying frustrated expectations, ie. the modern word "disappointment". Metaphor became literal truth.]
Beyond similarity of structural form, there is similarity in emotional form (or maybe emotional content is an element of structural form), which further fuels the evolution of denotation. Take the pairs liberty/hedonism, or conviction / “foolish consistency”, tradition-mindedness/backwardness, respectful/obedient… the list goes on and on. As I encounter new objects of experience, I apply words to them based on similarities of form and sort them into pairs. A political example: Noam Chomsky labels US covert operations in Nicaragua in the 80s as “terrorism”. What would Ronald Reagan call it? A religious example: A Muslim fundamentalist may label American women’s degree of bodily exposure “evil” or “blasphemous”. A ’sex-positive’ feminist may label it “liberating” or “empowering”. I believe this is also known as “framing” an issue.
The frame an individual chooses is heavily dependent upon her upbringing, socialization, education, cultural background, etc. Consensus is generated (or at least the dominant opinion made known) as individuals communicate their interpretations of common experience to one another. To the extent that people ‘care’ about the outcome of such interpretation (perhaps because it touches upon their religious beliefs, opinions of others, or investment-backed expectations) self-reinforcing norms are created that encourage communication of certain ideas and dampen the communication of others. These are perpetuated by habit and molded by power relations (not every person has the same capacity to influence the opinions of others and hence affect consensus/norms).
This seems to be the process by which certain actions are “sorted” under the umbrella of “autonomy” and others are not. I don’t know if that = conventionalism or not.
So… to finally reach your point that a morally inert definition of “autonomy” should be possible, I agree that it is, but you would have to strip the word of its emotional (and hence rhetorical) content. I have no doubt that this is possible, just as the word “terrorism” could be drained of its moral undertones. But my guess is that such an achievement would ignore the role words play in influencing others (their ‘perlocutionary force’), although perhaps with a gain in descriptive clarity (which, now that I think about it, may be useful in guiding the next mutation in meaning). The true benefit of a morally inert account of “autonomy” would be to splice apart its descriptive and its emotional/judgmental components and lay them bare, forcing people to attach adjectives in front of the noun (such as “healthy autonomy” or “antisocial autonomy”), and thus forcing them to evaluate their emotional commitments more precisely (assuming of course that a morally inert account of autonomy, if successful, would bleed through the walls of academia and into popular consciousness and usage).
3) As for homicide under hedonistic utilitarianism, how would physician-assisted suicide fare under its analysis? socially-condoned human sacrifice?
Matt,
i) I’m now struck by the need to defend an idealized naturalistic account of the philosophical development of autonomy. One may do this, as usual, by considering alternative accounts in the development of autonomy, and wondering how plausible they are as candidates. (For the sake of convienience, we have to do this presupposing idealized conditions, i.e., where the ideas are produced by philosophizing and not necessarily by coercion, etc. Nothing hinges on this, I don’t think; though as you point out, interesting questions may be raised. We should also presuppose that the three items – agency, equality, and autonomy — have value, though this may be challenged. By “incorrigible”, I mean a value which is inevitable, inescapable.) The important alternatives would include:
- Account-A, which sees autonomy as being of incorrigible value independently of human interaction;
- Account-B, which argues that agency is not natural or incorrigible as a value, as the value of agency only arises out of interaction; or
- Account-C, which disputes that equality is involved in the development of an idea of “autonomy” at all.
My immediate intuitions are that a) the dignity (and hence autonomy) of persons is robbed of them all the time, and sometimes for very good and moral reasons (i.e., to prevent terrible consequences); and c) in moderate form makes good as a challenge for making the concept of “equality” clear, but leaves open the possibility of an idea of autonomy which is narrowly egoistic, i.e., “My autonomy is primary, everyone else can go to hell”, which is possible for kings and tyrants, but from which philosophers would cringe due to constant interaction and wisdom gained from social experience. And the dispositions of tyrants is not itself of interest. I’m not sure how I would reply to b), except to say that since happiness is of intrinsic value, and happiness requires experience of happiness, and the experience of happiness is often done either by satisfaction of (or anticipation of) preferences and choices in mind, agency will inevitably be of value.
Your point regarding limited equality is well taken. Kohlberg (and presumably others) used the word “equity” to describe the practice of establishing the social threshold for equal consideration. Nevertheless, relative to the group under investigation, the idea of equality *might be* the same between a charitable group and an uncharitable one; it’s just that they may use the idea differently. In other words, my clique of friends may be quite elitist, and this other band of friends may be very chummy and see everyone as a peer; but the idea of equality that both make use of may be the same relative to how they use it. (Or maybe not. Now that I think of it, I have doubts. But I just wanted to point out the possibility that the concept may be roughly the same, not to argue that it is. It’s certainly an interesting thing to think about.) In any case, yeah, this would fall outside of the optimistic tone by which the proposal was made.
ii) By “conventionalist”, I essentially meant the idea that the validity of a value arises out of its association with some community norm. The kind of interactionist view that you seem to take it more in line with my view, but perhaps our common ground may not be philosophically significant to the issue at hand. Suppose that the categories of value/notvalued are created by emergent negotiation over a historical period, reinforced by habit. That doesn’t seem to change the problem.
By a kind of two-tables account, you have to resort to a change in the lexical meaning of the word “autonomy” in order to make a change in values. This is plausible, but I think the naturalistic account is more conceptually powerful. And rhetoric doesn’t have to suffer so long as we still have the language of rights at our disposal.
iii) This is departing a bit from our present topic, but I think utilitarianism passes the homicide test once we take remoter effects seriously. IE: the social impact of killing the one to save the five is to reduce the social worth of human life to a mere commodity, which will simply break the social world for the worse, given how humans learn, make decisions in a social environment, the standard of precedent, etc. The trouble which caused me to bring the issue up was that *relative to the dying individual*, utilitarianism seems to give no comfort; rather, it would look at the effects upon society, etc. This seems rather bloodless to people, as if utilitarians had missed an important point. Still, there are other ways to argue about this and show how and where the intuitions at play are consistent with utility.
Either side of the euthanasia debate might be defended, but from my point of view, the pro-euthanasia argument is far more powerfully and plausibly endorsed by the utilitarian argument. I also endorse the view, given certain dire circumstances. From my view, to deny a person the choice to remove themselves from their own suffering under an inescapable illness is to foster a culture of misery which I find ethically abhorrent.