Efficient Isn’t Moral
Efficiency isn’t morality, and it is a serious confusion to think it should be. Let me try again to explain. I said:
Economic welfare cares not about giving people experiences but about satisfying their preferences. … If we do something a dead person would have wanted, that counts as a benefit.
Adam Ozimek responded:
But we care about satisfying people’s preferences because, unlike the dead, they can know that those preferences being satisfied. … If were going to count the preferences of the non-existent, then it would seem that the number one priority of all society would be to bring as many of them as possible from non-existence into existence. The easiest way to do this is to mandate pregnancy. … If we care about satisfying the preferences of the dead even though they won’t know their preferences are satisfied, does that mean we should not be concerned with whether or not living people know when their preferences are satisfied?
Adam reminds us of Tyler’s position:
Dead people don’t count in the social welfare function. (If they did, how many of them would prefer non-democratic or racist outcomes? And would we count that? We shouldn’t and we don’t.)
When our distant ancestors sat around debating if to change locations, expel a troublemaker, or attack neighbors, they were often ambiguous about whether they were choosing what they wanted or what was moral; they preferred to pretend these were the same. We similarly prefer ambiguity when we argue policy today.
So it is important to clarify: As an analysis tool, economic efficiency is designed and well-suited to finding win-win deals that [added: tend to] get us all more of what we want. It is not well-suited to achieving moral outcomes, except when morality happens to coincide with getting people what they want. Otherwise, win-win deals will predictably not achieve morality when many involved do not want to be moral.
Many of us want things we will never experience directly; we want our children to prosper after we are gone, for example. This is especially true of our moral wants; we want our donations to Africa to actually help real Africans. So we are understandably wary of deal-making frameworks which explicitly suggest that they seek only to achieve the appearance, not the substance, of our wants. So yes, a deal-finding analysis tool should definitely count unseen wants! Furthermore, observers concerned that deals might neglect morals should be especially eager for our deals to achieve unseen wants.
Frameworks for finding win-win deals should also try to include as many things as possible that can have wants and participate in deals. This includes racists, pedophiles, slaves-owners, robots, animals, distant past and future folk, and future folk who may or may not end up existing. Yes many may be morally offended if racists get what they want, but that offense counts in what other folks want, and therefore enough offense will ensure that win-win deals will not give racists much of what they want.
Limits on contract may distort prices and interfere with the ability of efficiency analysis to help us find useful win-win deals. But that is a good reason to enforce more kinds of deals, not to try to distort efficiency for a task to which it is poorly suited: choosing moral acts.
Added: Bryan Caplan responds.
Economic welfare cares not about giving people experiences but about satisfying their preferences. … If we do something a dead person would have wanted, that counts as a benefit.
Close, but not quite. If while they were alive we did something a dead person wanted, that counts as a benefit. Doing something now after they are dead provides no benefit.
Finding win-win deals between the living and the dead is of no use if you don't find them until after they are dead. At that point it's not win-win, it's just win. And if there were a different deal that gave more to the living and less to the dead, then that's just a bigger win.
The dead do not have wants. The dead cannot participate in deals. The dead should play no part in our deal-finding framework, except to the extent that the living wish the same things the dead once wished.
Chris, it's an unproven assumption that people won't sit on their hands.
anon, you are correct that it also an unproven assumption. Robin Hanson's presentation at the Foresight Institute explains how the Luddites may have a point however.
Robert Bloomfield:"say and feel they want (a “revealed preference” model)"I think revealed preference normally suggests "actions speak much louder than words".
"legislators argue that they know preferences better than individual agents"I don't think the assumption that preferences are poorly defined and time-inconsistent is sufficient to reach that conclusion.
John:There are other utilitarian arguments for the extermination of humanity and more.
James Andrix:The enforcement costs for activities in the privacy of ones own home are high, and the people engaging in such activities normally have a much higher willingness-to-pay relative to those opposed to it. This efficiency is why David Friedman thinks anarchy would likely (though may not be) be libertarian. Using the "least-cost avoider" approach in Robin's follow-up, we might argue that those offended by others behavior can more easily decide not to pay it much attention.