Introduction
This article deconstructs the myth of economic neutrality, revealing it as an arena of value conflicts and hidden normative choices. Through the lens of classical and contemporary theorists, we demystify the concepts of efficiency, growth, and justice. You will learn why technocratic models often mask ideological foundations and what the real costs of economic decisions are in a world of irreconcilable conflicts of interest.
Mill: The Stationary State Ends the Pursuit of Growth
John Stuart Mill, a precursor to the degrowth movement, separated material growth from civilizational development. He argued that policy should not treat GDP as a universal solution to conflicts, but rather focus on the quality of relationships and the maturity of institutions.
Samuels: Ideology Legitimizes the Economic System
Warren Samuels defines ideology as the invisible foundation of every theory. It is most effective when it feigns objectivity, masking normative choices within the technical parameters of models.
Pareto Optimality Sanctions Social Inequality
The Pareto criterion considers a state efficient if no one is made worse off. However, it is blind to distribution, which allows extreme inequalities to be legitimized as a model of efficiency while protecting the status quo.
Arrow’s Theorem: The Absence of a Coherent Collective Will
Kenneth Arrow demonstrated that there is no perfect procedure for aggregating individual preferences into a coherent social choice. This exposes the fiction of neutral public decisions and technocratic moralism.
Coase: Transaction Costs Shape Market Structure
Ronald Coase proved that transaction costs are almost never zero. Efficiency, therefore, depends on the choice of institutions that minimize coordination and enforcement costs, rather than on the market alone.
Schumpeter: Creative Destruction Drives Development
For Joseph Schumpeter, innovation is creative destruction—a brutal rhythm in which development requires accepting failures and bankruptcies. In this view, stability is often the price of stagnation.
Samuelson: Trade Deepens Income Inequality
Paul Samuelson showed that trade liberalization is always a distributional act. Opening borders shifts the political balance of power and changes factor prices, carrying specific social consequences.
The Capital Controversy: Cambridge vs. Cambridge on the Measure of Wealth
Sraffa and Robinson challenged the neoclassical measure of capital, showing that it depends on the rate of profit. This proves that income distribution results from bargaining power and institutions, not just technology.
Kalecki: Capitalist Spending Finances Their Profits
Michał Kalecki demonstrated that profits are not a reward for productivity, but the result of capitalists' spending decisions. If investment falls, profits and employment decline—this is an iron law of macroeconomics.
Monetarism vs. Post-Keynesianism: The Dispute Over the Nature of Money
While monetarism views inflation as a purely supply-side phenomenon, Post-Keynesians emphasize the role of fundamental uncertainty and institutions. This dispute defines contemporary debates on central bank credibility.
The Minsky Hypothesis: Stability Generates Crisis
Hyman Minsky warned that financial stability breeds complacency, leading to excessive debt and Ponzi schemes. The capitalist system naturally trends toward crisis if it lacks constraints.
Decision-Making Vademecum: Rationality in Management
The key principle is: there are no purely technical decisions. Every economic choice disrupts the existing distribution of income and power. Ignoring this conflict leads to the accumulation of systemic risk.
Summary
Tobin: Specific Egalitarianism Rations Goods
James Tobin noted that societies more easily accept the redistribution of goods such as health and education than cash transfers. This builds the connective tissue of the community and the legitimacy of institutions.
Globalization: Protectionism Displaces Free Trade
Contemporary geopolitics is replacing the logic of cost minimization with the logic of survival maximization. Supply chain resilience is becoming more important than pure market efficiency.
Samuels: Fictional Neutrality Hides Political Choices
Economics faces an aporia: it cannot be both normatively empty and socially responsible. Arrow’s paradox finally buries the hope for a technocratic escape from the impasse—every economic action remains a political act for which full responsibility must be taken.
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