Whether conscious of it or not, economists rely on ethical norms and principles to carry out research and to inform policy choices. Economic efficiency, for example, is a powerful ethical concept, yet can be misapplied, as Jonathan Wight explores in this article. Understanding the institutional and ethical frameworks for policymaking is key to using economic tools correctly.
Ethics is the study and use of moral principles and values to determine right from wrong. Ethics permeates much of social interaction – including, of course, participation in market activity.1 Ethical values and principles are also embedded in the way economists explore both positive and normative economics, infusing the practice of economics. It behooves us to step back and take in this bigger picture.
The bigger picture would start with a pluralist understanding of ethics. The right or best action encompasses not only a utilitarian consideration of costs and benefits, but extends into realms of duty and virtue, where intentions and motives matter. Rules of behaviour often derive from right reasons instead of right outcomes. A pluralist ethos would include consideration of human rights, treating other people as ends in themselves and not merely as means to one’s own ends.