Skip links

What light does a 13th Century theologian throw on a ‘humane economy’?

There is no one better than the author herself to explain the purpose of this book:

“The key question at the heart of this project would be how to balance pragmatic realism about the fact that humans are most often driven by incentives with the need to address humans directly as rational agents capable of discerning what goods are worthy of pursuit, in a form that is better suited to attaining genuine happiness but is not well captured by the rational choice model” (xvii).

We shall unpack this into its two main elements, a critique of mainstream economics, anchored on the rational choice model, and a proposal regarding the foundational premises of a “humane economy,” which turns out to be a “theological economics.”

Not much is new in the characterization and objections presented to the rational choice model, except perhaps for the observation that even the latest trends in the discipline, such as behavioral economics, continue to fall in line. Hirschfeld describes the rational choice model through four major features. First, in its underlying anthropology consisting of individuals with unlimited wants who, despite scarce resources of income and time, manage to efficiently procure the optimal bundle of goods and services for themselves. Second, the presumption of omniscience among agents in their choices, notwithstanding the cost of information and the persistence of systematic cognitive errors. Third is its mathematical robustness, allowing the model to accommodate a plurality of motivations within identical formulas for analysis. Thanks to this mathematical sophistication, economic thinking could rightly claim the scientific status proper to the deliberations of an objective, impartial observer. And fourth, the explanation of the decision making process in terms of tradeoffs between costs and benefits among alternatives. Differences between values and material wealth are eliminated and both are subject to the same standard of preference weightings.

Click here for entire article.

Share with Friends: