Table Of ContentEconomics, Ethics and Power
Economic theory in its neoclassical form is sometimes regarded as free from values; it
is simply the theory of economic exchange. This can only hold true if we accept the
idea of “Homo Economicus” and the equilibrium economy. But in the real world,
away from neoclassical models, there is no intrinsic stability as such. Instead, stability
is created by the surrounding social, cultural and political structures. Clearly, it is
imperative that ethics features in the analysis of these economic and socio-political
structures.
Drawing on Aristotle, Kant, Hume and others, this book conceptualizes the
analysis of ethics and economic and social structures. It first considers the key
philosophical underpinnings and categories which frame the discussion of ethics
in economic theory and then considers individual ethics, social action, financial
structures and war. Throughout, ethics are examined in a multicultural context
with structural complexities, and the difficulties in finding a coherent set of ethics
which provides social cohesion and an open society are considered. A key part of
this is the comparison of two ethical principles which can be adopted by societies:
ius soli or loyalty to constitution, and ius sanguinis or loyalty to “Blood and Soil”.
The latter is argued to lead to problems of Us and the Other.
Introducing the possibility of integrating microscopic ethics into socio-political
structures and proposing the eventual existence of a global ethics, this volume is a
significant contribution to the emerging literature on economics, social structures
and ethics. It will be of particular interest to those working in business and public
administration and who have an education in socio-economic areas, but it also has
a broad appeal to students and academics in the social sciences.
Hasse Ekstedt is a Senior Researcher at the School of Public Administration at
the University of Gothenburg, Sweden.
Routledge Frontiers of Political Economy
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Resisting Financialization with Deleuze and Guattari
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Class and Property in Marx’s Economic Thought
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Economics, Ethics and Power
From Behavioural Rules to Global Structures
Hasse Ekstedt
For a full list of titles in this series, please visit www.routledge.com/books/
series/SE0345
Economics, Ethics
and Power
From Behavioural Rules to
Global Structures
Hasse Ekstedt
First published 2019
by Routledge
2 Park Square, Milton Park, Abingdon, Oxon OX14 4RN
and by Routledge
711 Third Avenue, New York, NY 10017
Routledge is an imprint of the Taylor & Francis Group, an informa business
© 2019 Hasse Ekstedt
The right of Hasse Ekstedt to be identified as author of this work has been
asserted by him in accordance with sections 77 and 78 of the Copyright,
Designs and Patents Act 1988.
All rights reserved. No part of this book may be reprinted or reproduced
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registered trademarks, and are used only for identification and explanation
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British Library Cataloguing-in-Publication Data
A catalogue record for this book is available from the British Library
Library of Congress Cataloging-in-Publication Data
Names: Ekstedt, Hasse, author.
Title: Economics, ethics and power : from behavioural rules to global
structures / Hasse Ekstedt.
Description: Abingdon, Oxon; New York, NY : Routledge, 2019. | Series:
Routledge frontiers of political economy | Includes bibliographical
references and index.
Identifiers: LCCN 2018013215 (print) | LCCN 2018013627 (ebook) |
ISBN 9781315271392 (Ebook) | ISBN 9781138281028
(hardback : alk. paper)
Subjects: LCSH: Economics—Moral and ethical aspects. | Economics—
Political aspects.
Classification: LCC HB72 (ebook) | LCC HB72 .E425 2019 (print) |
DDC 174/.4—dc23
LC record available at https://lccn.loc.gov/2018013215
ISBN: 978-1-138-28102-8 (hbk)
ISBN: 978-1-315-27139-2 (ebk)
Typeset in Bembo
by Apex CoVantage, LLC
Contents
List of illustrations viii
List of tables x
Acknowledgements xi
Introduction 1
Structure of the book 7
Prologue 11
Introduction 11
Economic theory 12
Neoclassical axiomatic structure 14
The axioms 14
The axioms and aggregation 17
Barter and production 17
Homo Œconomicus, rationality and equilibrium 18
Arrow’s Impossibility Theorem 20
Methodological aspects 25
Disequilibrium 28
Money 31
The fundamental contradiction intrinsic to money 36
1 Ethics in philosophy 39
The myth 39
Ethics and epistemic cycles 41
Ethics and its connotations 42
Humans as moral creatures or calculating beasts 49
Aristotle 49
Thomas Hobbes 54
Reason and passion 57
Kant 57
Hume 66
vi Contents
Moore’s paradox 72
Kant – Hume – Russell 74
The art of defining and what we perceive 76
2 Philosophy and economics of the modern world 81
The heart of the matter 81
The direction of time 83
Space-time 86
The neoclassical trap: lessons from Arrow’s paradox 95
Structures and structural compositions 97
The problem of zero 99
Negative facts 103
Conclusion 105
Appendix on space-time 106
3 Economics and ethics in economic theory:
action and remorse 111
François Villon: Poésies Diverses 111
What is ethics? What is rationality? 113
The heart of the matter 114
Rationality and causality in space-time 117
Arrow’s paradox, the market principle and public government 121
Efficiency, growth and welfare 125
Production efficiency 127
Necessity and choice possibility 132
An economic interpretation 136
Some comments of ethical character 137
“In the long run we are all dead” 139
Stability, creativity and inventions and social goals 140
4 Faith and axiomatic structures 147
“Assensus intellectus veritati” 148
Holism versus atomism 157
Hume’s and Kant’s conflicting views 163
“Beantworten der Frage: Was ist Aufklärung?” 165
“Thou shalt . . .” versus “Thou shalt not . . .” 169
Utopias: dictatorship and/or evolution 170
Arrow’s paradox once again 174
5 Collective ethics and forms of government/governance 177
Retirement of Diocletian at Salona, as told by Edward Gibbon 177
Collective and private conceptualization and interpretation 179
Contents vii
Collective decisions – cultural and social homogeneity – knowledge 184
Forms of government 190
Alienation – anomie – anonymity 195
6 Money, financial structures and ethics 206
“Pecunia non olet” 206
Neoclassical theory, money and structures 210
Financial system: necessity, structure and output 214
Money 218
The structural changes of the financial market 224
Securitizing, uncertainty and trust 227
7 The Other and collective social action 232
Listen to the truth and grow up 232
Introduction 232
Collective ethics, the nation and Fides Punica 234
Ethnicity: racism and “untermenschen” 237
Blood and Soil versus social engineering 239
The dark shadows of the 20th century Swedish debate of racial hygiene 242
#MeToo 245
Power, loyalty and responsibility 247
Ethics, the state and the market 251
The breakdown of nations? 254
8 War 261
Introduction 261
Breakdown of ethics 263
The lessons from Clausewitz 265
Two examples from Sweden 268
Four generations of war 269
Is there a fifth generation of warfare? 270
Conclusions and epilogue 273
Conclusions 273
Epilogue 275
Bibliography 277
Index 282
Illustrations
Figures
P.1 A sketch of the proof of the existence of general equilibrium 15
P.2 Additive aggregation 21
P.3 Mathematics and causality 26
P.4 Epistemic cycle 29
1.1 Mixture of perspectives 62
2.1 Epistemic cycle 83
2.2 Space-time 88
2.3 A space-time illustration 92
2.4 Reduction of dimensions 99
2.5 Potentiality of dimensions 100
2.6 Relation between commodities and utilities 105
3.1 Development of structural unemployment 129
3.2 Lexicographic preferences 135
3.3 Illustration of the entropy principle 143
4.1 A coastline map 161
5.1 Daily average costs for hip operations 180
5.2 The complexification of society 189
6.1 Price of liquidity 215
6.2 Investment horizons, discount rates and expected rates of return 217
6.3 Monetarism/Currency School 225
6.4 Securitization system 225
Pictures
4.1 Bathos – Logos – Pathos 149
4.2 The beach 161
4.3 The non-beach 162
5.1 Volenti nil impossibile 181
5.2 Podestas iudicialis 194
Illustrations ix
Diagrams
A.1 The general space-time situation 106
A.2 Distinction between spatial distance and time distance 107
A.3 Illustration of distortion of mass 108
