Economics, Welfare and Alternative View of Man

Agosin’s view is somewhat abrupt when referring to other economists, while his view is one of utopian and socialist ideals. He seems to challenge the views of economists – especially those of the first or developed world, saying that the assumptions used to create economic theories are not reality, but rather an analysis of reality by a specific person or group of people.

Agosin looks at the distinctive factors of assumptions and value judgements in “normal” economics. There are six important assumptions made by conventional economics about man and his relationship to economic activity:
1. The individual has a certain set of preferences that are stable and produced in rank ordering
2. The individual’s only concern is to maximise his satisfaction
3. Utility is usually constrained to marketable things
4. Economists believe that there must always be some unfulfilled need
5. Utility is completely personal
6. Economists do not think that outside effects are significant

Following is another list; this time of what Agosin considers being applicable information to his discussion:
• Each individual knows what is best for himself, therefore, an economic system which respects the choices of consumers and tries to “deliver the goods” that the consumer desires receives high marks from the economist
• “Utility” is good, consumption is “good” and work is “bad”
• “More is better than less”, also known as GNP-fetishism
But, economists don’t always agree that more is better than less, especially if it means that one person getting more will be accompanied by another getting less. The result to this is known as the Paretian welfare principle, which simply states that welfare is increased when somebody is made better off and nobody is made worse off.

Agosin turns his attention to “consumer preferences”. Economists have stated for many years that “preferences are stable”. The main reason Agosin gives for this explanation is that if preferences are not stable much of the analysis economists have done collapses. Ward, another writer Agosin refers to, believes that the assumption that “preferences are stable” ultimately stems from the idea that personality is stable. This ultimately leads to a question of identity – and what it really is.

When satisfying basic needs, the form in which they are satisfied is clearly influenced by the social system. In modern industrial society, most individuals devote their surplus time and energy to acquiring additional marketed goods and services, and few people are oriented primarily toward non-market activities or the satisfaction of extra-market needs. Agosin states that modern man lives in order to produce and consume and that he does not produce and consume in order to live. Another issue raised by Agosin, is how important these external effects really are. It is known today that the assumption that “external effects are minor” is not correct, and therefore external effects are an important issue for economists to deal with.

Gintis – another writer Agosin refers to – believes that people have come to desire more consumption and less work for three main reasons:
1. the social system does not expose them to non-economic kinds of satisfaction
2. social activity contexts are alienated
3. the social system inhibits individuals from developing capacities for satisfaction which would endanger their participation in the system and fosters the capacities for satisfaction that ensure their participation

Agosin states that what must be challenged is the view of the system wanting us to buy happiness. To do this, individuals must form a distinction between needs and wants. It is because economics fails to make a distinction between the two that it conveniently forgets to declare the coexistence of waste and unfulfilled basic needs in our society. Agosin makes it clear to the reader that there is a great need for a new view of man and different notions of welfare. Below is a list of a few authors Agosin mentions and what their main ideas and aims are:

• attempts to broaden the notion of welfare, which depends on the nature and quality of the activities undertaken by the individual
• two types of activities: relational (involving relationships) and instrumental (goal-orientated)
• welfare economics concentrates solely on goods
• similar view to Gintis
• recognition of the multi-dimensional nature of human existence
• attention must be paid to the area of meaning, values, unknown, feeling and love
• only when vital needs are fulfilled can one certain point of consumption be reached
Guevara, Gurley, Marx
• relationship between alienation and social structure
• deliberately work toward the transformation of economic man into socialist man
• individuals will be encouraged to develop their full creative powers
• minimisation of needs, and therefore consumption
• all individuals are to perform both mental and manual work
• downgrading of the importance of consumption and material satisfaction
• problem lies in the transfer of technology

What Agosin emphasises is the need for “economic man” to change to participatory man – maximising integration, community, consuming only what is needed and working because one has working capacity. He also states that unfolding one’s individual capacities (intellectual, manual, affective, spiritual) will more than likely enhance productivity. Aspects that should fall away are alienating work, personal consumption as well as satisfying wants. Rather emphasis should be placed on redistribution in the workplace and reducing wants. This would result in people finding more opportunities to develop all their capabilities, a dispersal of population into rural areas, and technology would become more oriented to the needs of miniaturised cities and would not be in continuous conflict with the natural environment. Agosin’s idea is good, but one factor he forgot to mention was that people are selfish – what they work for they want. If their outcomes are going to be distributed they will surely only do what they have to.

Need a Custom Economics Paper?