This book follows the flow of economic thinking from ancient times by observing how moral issues impacted economic ideas and social organization. Over the centuries, thinkers such as Aristotle and Thomas Aquinas emphasized what was right and good more than the pursuit of social efficiency. That changed when scientific methods no longer required moral considerations and economics adopted a values-free scientific methodology. A positive-normative dichotomy has served the profession well in many ways, but there have been voices arguing for a more values-oriented approach to the discipline. Now mi ... More

This book follows the flow of economic thinking from ancient times by observing how moral issues impacted economic ideas and social organization. Over the centuries, thinkers such as Aristotle and Thomas Aquinas emphasized what was right and good more than the pursuit of social efficiency. That changed when scientific methods no longer required moral considerations and economics adopted a values-free scientific methodology. A positive-normative dichotomy has served the profession well in many ways, but there have been voices arguing for a more values-oriented approach to the discipline. Now microeconomics is facing many new challenges as the complications of interdependence increase and behavioral, neurobiological, and other interdisciplinary perspectives need to be addressed. The search to understand and explain behavior is pushing the discipline to enlarge its methodology beyond the standard instrumental prediction goals. This complicates analysis as multiple motivations for behavior are considered and interest in the formation of utility functions begins to creep into economic consciousness again. Moral reflection is relevant as game theory, cooperation models, and theories of trust enter into the discussion. Psychological tendencies and institutional changes involve reference to the moral life as essential for social coordination. The final chapter offers an interdisciplinary framework to incorporate values more directly into economic methods by building on the human passions as discussed by Adam Smith and the behavioral instincts described by Thorstein Veblen. This enlarges the scope of economic actors beyond the homo economicus model without abandoning some of the valuable features of that model.