Re: Self-interest

[Jim Devine <JNDF%LMUACAD.BITNET@xxxxxxxxxxxxxxxxx>]

Herb
> said that the phenomena economists investigate (the
>firm, markets, exchange, state intervention, etc.) do not need more
>than reciprocal altruism (in the form of repeated game interactions. I
>am not arguing that humans don't have higher moral senses--only that
>we can understand economic activity without invoking such higher moral
>senses. Or else I would like to see a counterexample of where they are
>necessary.

to cite one example (from a dusty old tome which is probably irrelevant
to fashionable economic scientists): Adam Smith argued (mostly in
the THEORY OF MORAL SENTIMENTS) that greed was not enough to
make markets work. A certain "fellow-feeling" was necessary
-- specifically, respect for other peoples' private property rights.
Without this kind of general consensus in favor of private property,
the free market degenerates into a Hobbesian war of each against all.
(State enforcement of property rights becomes extremely expensive
if not impossible if people lack this consensus.)

(Unfortunately, the above is based on secondary sources: please
correct me if my interpretation of Smith is wrong.)

sincerely,

Jim Devine
jndf@xxxxxxxxxxxxxx or jdevine@xxxxxxxxxxxxxxx
Econ. Dept., Loyola Marymount Univ., Los Angeles, CA 90045-2699 USA
310/338-2948 (daytime, during workweek); FAX: 310/338-1950
"For Truth, justice, and the American Whey!" -- L.M. Muffett