Sunday, October 25, 2009

Can a Society aim to be virtuous?

I should qualify this post with a disclaimer: I really enjoy vanilla economics. I like talking about tax systems, bank regulation, development, and town planning.

Sometimes, however, I get a little bit excited, and start to think about other things---the kind of dancing that in Strictly Ballroom loses Pan-Pacific Grand Prix tournaments.

The Virtuous Society: A worthy aim?

Economists generally have fairly concrete aims: inflation, unemployment, efficiency, growth, disease, education, crime, etc. The one very big one doesn't seem to be mentioned much---I think partly due to a lack of the Common Balls, and partly due to the fact that those who have mentioned it in the past have been genocidal maniacs---is `virtue'. Virtue is almost certainly the aim of all societies; this aim is reflected in law, religion, and many of those little social customs which help determine the social standing of people. I think also that virtue is inextricably bound to economic behaviour.

Virtuous behaviour is synonymous with economic temperance. The virtuous man is one who does not discount the future when making his decisions: he exercises rather than eating chocolate, abstains rather than drinks, studies rather than shirks, and never sleeps in. The man of vice trades the future for something a bit more immediate. A sugar hit.

I am not religious, though virtuous behaviour is put well by Luke 12: 37-38

Blessed are those servants whom the master finds awake when he comes; truly, I say to you, he will gird himself and have them sit at table, and he will come and serve them. If he comes in the second watch, or in the third, and finds them so, blessed are those servants!

Should Virtue actually be our unspoken social aim (I think it is, though I'm happy to be persuaded otherwise) then there are two distinct possibilities of its nature, each with their consequences for policy.

The first is that virtue is learned temperance. Social institutions, in this case, have the role of determining the norms of discounting. The Singaporese, who save almost half their private incomes, are normalised in a culture which places some (economic) weight on the distant future. In Guinea-Bissau and Burundi, they worry about today more---both countries were on average disinvesting between 2000 and 2005 (World Bank 2005). The difference is between their common social perceptions of the value of the future. Surprisingly, is it not due only to poverty---Haiti saves a greater proportion of private income than does Australia.

Should virtuous behaviour be just learned temperance, then policywise, there is an ethical dilemma: what is the acceptable cost in terms of liberty of "nudging" society into having a more distant gaze? This question recognises that any policy which is based upon having people modify not only their consumption choices, but also their choices of non-economic behaviour (like the decision whether or not to engage in road rage), requires some level of negative payoff. In this respect, Deepak Lal's thesis---that many Eastern societies govern individual behaviour by concepts of familial honour---is interesting: moderating influences are enforced by the group to which the ultimate consequences of individual indiscretion flow.

Judging most policy against this first possibility, it is hard to see that government believes wholly that virtue can be learned. `Consenting adults', the cornerstone of the brand of liberalism I enjoy, seems to have influenced most policy, save drugs and bicycle helmets.

The second possibility is that virtue is not learned temperance, but actually the capacity of only a few virtuous people. Under this scenario, there is little that can be done to make one obey virtuous behaviour; there are simply good eggs and bad eggs. What role is there for policy in this circumstance? Save recognising and helping good eggs (which already happens)---very little.

1 comment:

Jack Fuller said...

Dear Jim,

Thanks for the thought-provoking post. This is a central concern and one I'm keen to develop in future. I hope these themes will be an ongoing discussion.

I had a couple of thoughts:

Firstly, it's a good point you make that levels of virtuous behaviour shape some economic metrics, such as savings. In thinking about virtue though we should be careful not to relate them exclusively to one metric. Cultivating a virtue in one area of life actually affects many other areas of life as well.

For example, learned temperance (self-control) in savings contributes to a core habit of self-control that may reduce domestic violence, overeating, and improve study behaviour, as well as other externalities (probably negative and positive). People becoming interested in self-discipline has widespread effect which may spread beyond the domain in which they developed (i.e. savings). Though this would need to be investigated.

Secondly, it strikes me that this is primarily and issue of culture, not policy. Or rather, the question is: What role can policy play in producing a good culture? My fantasy is that we will develop a systemic approach to cultivating a culture in the same way that we currently approach economics. We will be able to identify the main institutions central to culture, the working parts, the metrics and the outcomes of certain changes (though hopefully we'll get over such sterile language).

As an operational starting point I'd define culture as patterns of virtue - each virtue being a cluster of habit, behaviour and belief. It's different from economics in that it is fundamentally normative; it's about what is good and right and true.

If we understood culture in the same systemic way we understood economics, we'd probably see our culture as the equivalent of an underdeveloped country. And we'd put at least the vanilla elements in place to start rebuilding a civilisation.

Never, of course, forgetting Kant's "crooked timbers of humanity".

In hope and caution,