Economics and human nature: selfishness and solidarity

My point here is that human nature is a complex thing. There is a selfish streak, but there are also other considerations, like truth, justice, solidarity. Human values/morals are not axiom systems.

It follows that many of the concepts in economics are ideological rather than "scientific". That's not necessarily a bad thing. Our understanding always progresses by simplifying and making assumptions. But it's always prudent to consider alternative systems, with different assumptions, especially as they relate to human nature.

To illustrate, let's take the case of Pareto efficiency. That's a specific type of economic efficiency. Basically it says that if everyone is no worse off, but someone is better off, then it's a Pareto improvement. And if no further improvements can be made, it's Pareto optimal.

Markets are intimately connected with Pareto optimal solutions.

Now, that's a highly ideological notion. There's nothing holy about it. And in fact, these caveats can be found throughout the development of neoclassical economics.

To take a simple but far from obvious case. Consider a owner and a slave. The slave labours and the owner looks over him, maybe directing him to do this and that. They make a profit. And then the owner takes 90% and gives the slave 10%. That's a Pareto optimal solution. Is it acceptable?

To make this interesting, let's consider analogous scenarios.

a) Replace the slave with a beast of burden. Now what?
b) Replace the slave with a wage slave, namely a worker. Now what?

It's clear that the other cases (as well as the original one) are far from clear. It very largely depends upon our view. Should animals be treated like human beings? If not, how different?

It's clear that "culture" or "justice" or things like "solidarity" play a very important role. These things, though hard to quantify, are deeply rooted in human behaviour.

The task of social movements, past and present, is to change this view. Intellectual discussions are important, but won't solve the root problem. The way of changing the view is through education and awareness, at least.

For instance, let's look at slavery. Slave owners were giving many plausible arguments. Do you take better care of your car when you own it, or rent it? Therefore, we should own the slaves. Not rent them, like labour bonded to capital.

This argument was abolished only when the people decided that people ought not to be owned. That's a value judgement. It's extremely hard. It was not done by arguing about the merits of private property.