Tutorial 3

Readings (Reclaiming Virtue Ethics for Economics):

 Virtues: acquired character traits or dispositions 19 (that is, natural tendencies) that
are judged to be good.
 Telos: end goal?
E.g bravery is a virtue for a soldier bcs it contributes to victory (telos)
E.g telos of university education is “knowledge and critical thinking” and virtue:
study and participate in educational activities with the intention of acquiring or
contributing to knowledge and critical thinking”.
 How to determine the telos of a domain?
According to Aristotle: telos is a natural fact that can be ascertained by intuition
According to modern virtue ethicists favour a communitarian approach: MacIntyre
(1984), understands the concept of flourishing as internal to specific communities
and cultural traditions. Thus, to identify the telos of a practice, one must discover
the meaning of that practice within the community of practitioners
 Extrinsic vs intrinsic motivation:
A person who is extrinsically motivated performs an activity “in order to obtain
some separable outcome.” But an intrinsically motivated person performs an activity
“for its inherent satisfactions rather than for some separable consequence”; such a
person “is moved to act for the fun or challenge entailed rather than because of
external prods, pressures, or rewards”
Thus, the analog of telos is the meaning that an individual attaches to an activity when
he sees the activity as an end in itself.
 The instrumentality of the market: the critique from virtue ethics
Argument: markets rely on extrinsic and thereby non-virtuous motivations. However,
Aristotle: “The life of money-making is one undertaken under compulsion, and wealth is
evidently not the good we are seeking; for it is merely useful and for the sake of something
else.” 1st claim: when individuals participate in markets, they show a lack of autonomy—
they act under compulsion.
2nd claim: the motivation for economic activity is extrinsic and thereby of an inferior kind—
the things that economic activity can achieve are merely useful and for the sake of something
else.
Argument: virtue ethicists are failing to find virtue in markets because they are not seeing
the market as a practice in its own right, with its own telos and corresponding market virtues.
 Intrinsic motivation and economics
Hypothesis: external reward can crowd out intrinsic motivation e.g Titmuss (1970):
introducing financial incentives for blood donors.
 Can the market be viewed as a practice with its own intrinsic values?
Telos of the market: mutual benefit (wealth creation, economic freedom)
 Market virtues
1. Universality → the disposition to make mutually beneficial transactions with others
on terms of equality
2. Enterprise & alertness → discovering and anticipating what other people want and are
willing to pay for.
3. Respect for the tastes of one’s trading partners →
4. Trust and trustworthiness → reputation for probity is more valuable, the more one
engages in trade
5. Acceptance of competition → a virtuous trader will not obstruct other parties from
pursuing mutual benefit in transaction with one another, even if that trader would
prefer to transact with once or another of them instead.
6. Self-help → accept without complaint that others will be motivated to satisfy your
wants, or to provide you with opportunities for self-realisation, only if you offer
something that they are willing to accept in return
7. Non-rivalry → seeing others as potential partners in mutually beneficial transactions
rather than as rivals in a competition for shares of a fixed stock of wealth or status.
8. Stoicism about reward →