The F-twist is giving way to the methodology of scientific research programs. Milton Friedman's “Methodology for Economics” is being supplanted as the orthodox rationale for neoclassical economics by Imre Lakatos' account of scientific respectability. Friedman's instrumentalist thesis that theories are to be judged by the confirmation of their consequences and not the realism of their assumptions has long been widely endorsed by economists, under Paul Samuelson's catchy rubric “the F-twist.” It retains its popularity among economists who want no truck with methodology, but among the increasing number of able economists who are writing on methodology the F-twist has been surrendered, not so much because these writers have decided it is false, as because something better has finally come along.

It is widely recognized that prioritizing health care resources by their relative cost-effectiveness can result in lower priority for the treatment of disabled persons than otherwise similar non-disabled persons. I distinguish six different ways in which this discrimination against the disabled can occur. I then spell out and evaluate the following moral objections to this discrimination, most of which capture an aspect of its unethical character: it implies that disabled persons' lives are of lesser value than those of non-disabled persons; it constitutes “double jeopardy” or violates Frances Kamm's non-linkage principle; it conflicts with equality of opportunity; it conflicts with fairness, which requires ignoring (some/most) differential impacts of treatment; it wrongly gives lower priority to disabled persons for equally effective treatment; it conflicts with giving all persons an equal chance to reach their full potential; and, it is in conflict with giving priority to the worse off.

There is a long-standing debate in philosophy about whether it is morally permissible to harm one person in order to prevent a greater harm to others and, if not, what is the moral principle underlying the prohibition. Hypothetical moral dilemmas are used in order to probe moral intuitions. Philosophers use them to achieve a reflective equilibrium between intuitions and principles, psychologists to investigate moral decision-making processes. In the dilemmas, the harms that are traded off are almost always deaths. However, the moral principles and psychological processes are supposed to be broader than this, encompassing harms other than death. Further, if the standard pattern of intuitions is preserved in the domain of economic harm, then that would open up the possibility of studying behaviour in trolley problems using the tools of experimental economics. We report the results of two studies designed to test whether the standard patterns of intuitions are preserved when the domain and severity of harm are varied. Our findings show that the difference in moral intuitions between bystander and footbridge scenarios is replicated across different domains and levels of physical and non-physical harm, including economic harms.

Forthright characterization of scientific uncertainty is important in principle and in practice. Nevertheless, economists and other researchers commonly report findings with incredible certitude, reporting point predictions and estimates. To motivate expression of incredible certitude, economists suggest that researchers respond to incentives that make the practice tempting. This temptation is the ‘lure’ of incredible certitude. I appraise some of the rationales that observers may have in mind when they state that incredible certitude responds to incentives. I conclude that scientific expression of incredible certitude at most has appeal in limited contexts. It should not be a general practice.

To understand the human capacity for psychological altruism, one requires a proper understanding of how people actually think and feel. This paper addresses the possible relevance of recent findings in experimental economics and neuroeconomics to the philosophical controversy over altruism and egoism. After briefly sketching and contextualizing the controversy, we survey and discuss the results of various studies on behaviourally altruistic helping and punishing behaviour, which provide stimulating clues for the debate over psychological altruism. On closer analysis, these studies prove less relevant than originally expected because the data obtained admit competing interpretations – such as people seeking fairness versus people seeking revenge. However, this mitigated conclusion does not preclude the possibility of more fruitful research in the area in the future. Throughout our analysis, we provide hints for the direction of future research on the question.

Benefit/cost analysis is a technique for evaluating programs, procedures, and actions; it is not a moral theory. There is significant controversy over the moral justification of benefit/cost analysis. When a procedure for evaluating social policy is challenged on moral grounds, defenders frequently seek a justification by construing the procedure as the practical embodiment of a correct moral theory. This has the apparent advantage of avoiding difficult empirical questions concerning such matters as the consequences of using the procedure. So, for example, defenders of benefit/cost analysis (BCA) are frequently tempted to argue that this procedure just is the calculation of moral Tightness – perhaps that what it means for an action to be morally right is just for it to have the best benefit-to-cost ratio given the accounts of “benefit” and “cost” that BCA employs. They suggest, in defense of BCA, that they have found the moral calculus – Bentham's “unabashed arithmetic of morals.” To defend BCA in this manner is to commit oneself to one member of a family of moral theories (let us call them benefit/cost moral theories or B/C moral theories) and, also, to the view that if a procedure is (so to speak) the direct implementation of a correct moral theory, then it is a justified procedure. Neither of these commitments is desirable, and so the temptation to justify BCA by direct appeal to a B/C moral theory should be resisted; it constitutes an unwarranted short cut to moral foundations – in this case, an unsound foundation. Critics of BCA are quick to point out the flaws of B/C moral theories, and to conclude that these undermine the justification of BCA. But the failure to justify BCA by a direct appeal to B/C moral theory does not show that the technique is unjustified. There is hope for BCA, even if it does not lie with B/C moral theory.

This paper defends revealed preference theory against a pervasive line of criticism, according to which revealed preference methodology relies on appealing to some mental states, in particular an agent’s beliefs, rendering the project incoherent or unmotivated. I argue that all that is established by these arguments is that revealed preference theorists must accept a limited mentalism in their account of the options an agent should be modelled as choosing between. This is consistent both with an essentially behavioural interpretation of preference and with standard revealed preference methodology. And it does not undermine the core motivations of revealed preference theory.

In this article, I examine Adam Smith's theory of the ways individuals in society bridge social and biological difference. In doing so, I emphasize the divisive effects of gender, race, and class to see if Smith's account of social unity can overcome such fractious forces. My discussion uses the metaphor of “proximity” to mean both physical and psychological distance between moral actors and spectators. I suggest that education – both formal and informal in means – can assist moral judgment by helping agents minimize the effects of proximity, and, ultimately, learn commonality where difference may otherwise seem overwhelming. This article uses the methods of the history of philosophy in order to examine an issue within contemporary discourse. While I seek to offer an authentic reading of Smith representative of his eighteenth-century perspective, I do so with an eye towards determining the extent to which Smith anticipated central issues in modern multiculturalism.

How do we determine the well-being of a person when her preferences are not stable across worlds? Suppose, for instance, that you are considering getting married, and that you know that if you get married, you will prefer being unmarried, and that if you stay unmarried, you will prefer being married. The general problem is to find a stable standard of well-being when the standard is set by preferences that are not stable. In this paper, I shall show that the problem is even worse: inconsistency threatens if we accept both that your desires determine what is good for you and that you must prefer what is better for you. After I have introduced a useful toy model and stated the inconsistency argument, I will go on to discuss a couple of unsuccessful theories and see what we can learn from their mistakes. One important lesson is that how you would have felt about a life had you never led it is irrelevant to the question of how good that life is for you. What counts is how you feel about your life when you are actually leading it. Another lesson is that a life can be better for you even if you would not rank it higher, if you were to lead it.

Axiomatic utility theory plays a foundational role in some accounts of normative principles. In this context, it is sometimes argued that transitivity of “better than” is a logical truth. Larry Temkin and Stuart Rachels use various examples to argue that “better than” is non–transitive, and that transitivity is not a logical truth. These examples typically involve some sort of “discontinuity.” In his discussion of one of these examples, John Broome suggests that we should reject the claim which involves “discontinuity.” We can, I suggest, make sense of the examples which Temkin uses while sacrificing neither transitivity nor “discontinuity.” This response to Temkin's examples involves developing and modifying James Griffin's account of “discontinuity.” If the account of “discontinuity” seems implausible, that is because of a failure to allow for vagueness. A similar argument can be made in the context of the well-known “repugnant conclusion.”

Postmodernism is often characterized, among other things, as the belief in the unattainability of objective truth and as a rejection of teleological and reductionist, or essentialist, forms of thought. For instance, in his provocative book The Rhetoric of Economics (1985), Donald McCloskey sketches the implications for economic methodology of Richard Rorty's (1979) rejection of the modernist quest for Truth, as represented by various rationalist and empiricist epistemologies. McCloskey describes modernist methodology as displaying a desire to predict and control, a search for objective–;which often means measurable–;knowledge, and an attempt to develop a value-free inquiry, among other characteristics (McCloskey, 1985, pp. 7-8). This “methodological correctness,” McCloske suggests, is discredited by the postmodern dissatisfaction with traditional epistemology. Thus, in place of the modernist belief in a rule-guided path to truth, he advocates a “free market” approach to knowledge, in which participants in the variety of theoretical conversations agree to be earnest and listen politely to one another.

This paper argues that, in light of the apparent settled nature of economists’ judgement on the issue of trade liberalization, the profession has stopped thinking critically about the question and, as a consequence, makes poor-quality arguments justifying their consensus. To develop support for this claim, the paper first recounts what economic analysis can say about trade liberalization. Then it analyses the quality of the arguments that economists make in support of free trade. The paper argues that the standard argument made by economists in favour of free trade is either incoherent or implicitly imposes philosophical value judgements about what is good for a nation or society, or it makes leaps of empirical faith about how the world works. The paper concludes with suggestions for better arguments.

Ever since Sen criticized the notion of internal consistency of choice, there exists a widespread perception that the standard rationalizability approach to the theory of choice has difficulties in coping with the existence of external norms. We introduce a concept of norm-conditional rationalizability and show that external norms can be made compatible with the methods underlying the traditional rationalizability approach. To do so, we characterize norm-conditional rationalizability by means of suitable modifications of revealed preference axioms that are well established in the theory of rational choice on general domains as analysed in contributions by Richter and Hansson, for example. We compare our approach to alternative suggestions that have appeared in response to Sen's criticisms, and we discuss its links to Sen's notion of self-imposed choice constraints.

A framing effect occurs when an agent's choices are not invariant under changes in the way a decision problem is presented, e.g. changes in the way options are described (violation of description invariance) or preferences are elicited (violation of procedure invariance). Here we identify those rationality violations that underlie framing effects. We attribute to the agent a sequential decision process in which a “target” proposition and several “background” propositions are considered. We suggest that the agent exhibits a framing effect if and only if two conditions are met. First, different presentations of the decision problem lead the agent to consider the propositions in a different order (the empirical condition). Second, different such “decision paths” lead to different decisions on the target proposition (the logical condition). The second condition holds when the agent's initial dispositions on the propositions are “implicitly inconsistent,” which may be caused by violations of “deductive closure.” Our account is consistent with some observations made by psychologists and provides a unified framework for explaining violations of description and procedure invariance.

This paper provides further evidence to the argument that Smith' theory of justice did not follow the natural justice school and that subsequently the ethical position on acquiring private property is not independent of the effects which such acquisition may have on the property-less individuals. I will show that the justification for private ownership is based on “reasonable expectations” which owners of assets have with regard to the fruits of the asset. The expectation to subsist through the use of one's natural assets is equally reasonable. This is not to say that Smith believed that society should equally distribute income. But it does mean that the acquisition of private property must not interfere with the rights of individuals to subsist. Consequently, distribution is clearly an important part of Smith's conception of justice.

A liberal egalitarian theory of justice seeks to combine the values of equality, personal freedom, and personal responsibility. It is considered a much more promising position than strict egalitarianism, because it supposedly provides a fairness argument for inequalities reflecting differences in choice. However, we show that it is inherently difficult to fulfill this ambition. We present a liberal egalitarian paradox which shows that there does not exist any robust reward system that satisfies a minimal egalitarian and a minimal liberal requirement. Moreover, we demonstrate how libertarianism may be justified in this framework if we drop the egalitarian condition.

I feel deeply honored and privileged to have the opportunity of giving the first Baffi Lecture at the Bank of Italy. Paolo Baffi was not only a distinguished banker and financial expert, he was also a remarkable economist and a visionary social thinker. He had outstanding technical expertise in many different fields, but combined his intellectual eminence with a profound sense of values. As Governor Ciampi put it at the general meeting of the Bank of Italy last May, Paolo Baffi represented “an extraordinary combination of penetrating logic, erudition and moral strength … [he was] not only a gifted student of economics, he had a deep-seated commitment to act for the common good.”1 In remembering Baffi today, we must keep in mind both his intellectual contributions and his general evaluative concerns.

Most game-theoretic accounts of institutions reduce institutions to behavioural patterns the players are incentivized to implement. An alternative account linking institutions to rule-following behaviour in a game-theoretic framework is developed on the basis of David Lewis’s and Ludwig Wittgenstein's respective accounts of conventions and language games. Institutions are formalized as epistemic games where the players share some forms of practical reasoning. An institution is a rule-governed game satisfying three conditions: common understanding, minimal awareness and minimal practical rationality. Common understanding has a strong similarity with Ludwig Wittgenstein's concept of lebensform while minimal awareness and minimal practical rationality capture the idea that rule-following is community-based.

John Stuart Mill provides a classic defense of individual and group rights to liberty with respect to purely private or self-regarding matters:

The only part of the conduct of any one, for which he is amenable to society, is that which concerns others. In the part which merely concerns himself … directly, and in the first instance, … his independence is, of right, absolute.… From this liberty of each individual, follows the liberty, within the same limits, of combination among individuals; freedom to unite, for any purpose not involving harm to others: the persons combining being supposed to be of full age, and not forced or deceived. (1859, pp. 224–26)

Critical-Range Utilitarianism is a variant of Total Utilitarianism which can avoid both the Repugnant Conclusion and the Sadistic Conclusion in population ethics. Yet Standard Critical-Range Utilitarianism entails the Weak Sadistic Conclusion, that is, it entails that each population consisting of lives at a bad well-being level is not worse than some population consisting of lives at a good well-being level. In this paper, I defend a version of Critical-Range Utilitarianism which does not entail the Weak Sadistic Conclusion. This is made possible by what I call ‘undistinguishedness’, a fourth category of absolute value in addition to goodness, badness, and neutrality.