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If we could get economists to stop pushing "utility" and stop concentrating on "economics is optimisation [of a single quantity]"...
But "utility" isn't a single quantity in any ordinary sense, it is the ineffable summation of all that is good for a rational being free of internal conflicts, and it just happens to be true that the only thing that matters to a rational being is money, so GDP = aggregate utility = good.

Snarky tone aside, the first half of the above captures a significant point, which is that utility is (of course) defined to be something a lot like "good" as judged from a personal perspective. The concept diverges from reality, though, because it suggests that different kinds of good are more comparable than (in psychological reality) they are. For example, it implies consistent valuations for benefits a day, a week, and a decade from now -- but human valuations don't work that way. This suggests to me that the concept of "utility" has limited utility. Worst, though, the idea turns toxic when it diffuses away from its origin.

As carefully stated by theorists, "utility" inherently includes (for example) the value of being able to expect a sustainable future, the value of having a clean conscience, the value of being a social cooperator, and so on. Acting according to "self interest" might include selfless devotion to others.
Striving to maximise utility in this sense is hard to argue against.

But as understood by people outside the little circle of theorists and their fans, utility mutates into the idea of getting stuff you want, including services and so on. And since rational people "should" maximise their utility, anyone who doesn't grab everything possible is an irrational fool. And since money can be exchanged for stuff, it makes a convenient measure of utility. Hence the sick equation, "GDP = aggregate utility = good".

In short, I'd argue that economic thinking has some surprisingly bad effects not because of what it is, but because of how easily it is debased into the idea that rational behaviour requires amoral acquisition.

Words and ideas I offer here may be used freely and without attribution.

by technopolitical on Sun Oct 22nd, 2006 at 03:19:34 AM EST
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