The Moral Conditions of Economic Efficiency

Schultz argues that markets are not moral-free zones, and that achieving the economic common good does indeed require morality.

Walter J. Schultz (Author)

9780521801782, Cambridge University Press

Hardback, published 18 June 2001

160 pages
22.9 x 1.3 x 15.2 cm, 0.41 kg

In the late eighteenth century, Adam Smith significantly shaped the modern world by claiming that when people individually pursue their own interests, they are together led towards achieving the common good. But can a population of selfish people achieve the economic common good in the absence of moral constraints on their behavior? If not, then what are the moral conditions of market interaction which lead to economically efficient outcomes of trade? Answers to these questions profoundly affect basic concepts and principles of economic theory, legal theory, moral philosophy, political theory, and even judicial decisions at the appellate level. Walter Schultz illustrates the deficiencies of theories which purport to show that markets alone can provide the basis for efficiency. He demonstrates that efficient outcomes of market interaction cannot be achieved without moral normative constraints and then goes on to specify a set of normative conditions which make these positive outcomes possible.

Preface and acknowledgements
1. Introduction and synopsis
2. A contextualized proof of the first fundamental theorem of welfare economics
3. The moral thesis: moral normative constraints are necessary conditions of pareto-optimal equilibrium allocations of commodities achieved through market interaction
4. A spontaneous order objection
5. The roles of normative constraints in relation to externalities
6. The moral conditions of economic efficiency
7. Implications
Notes
Bibliography
Index.

Subject Areas: Ethics & moral philosophy [HPQ]