The tenuous claims of cost-benefit analysis to guide policy so as to promote welfare turn on measuring welfare by preference satisfaction and taking willingness-to-pay to indicate preferences. Yet it is obvious that people's preferences are not always self-interested and that false beliefs may lead people to prefer what is worse for them even when people are self-interested. So welfare is not preference satisfaction, and hence it appears that cost-benefit analysis and welfare economics in general rely on a mistaken theory of (...) well-being. This essay explores the difficulties, criticizes standard defences of welfare economics, and then offers a new partial defence that maintains that welfare economics is independent of any philosophical theory of well-being. Welfare economics requires nothing more than anevidentialconnection between preference and welfare: in circumstances in which people are concerned with their own interests and reasonably good judges of what will serve their interests, their preferences will be reliable indicators of what is good for them. (shrink)

This book is about preferences, principally as they figure in economics. It also explores their uses in everyday language and action, how they are understood in psychology and how they figure in philosophical reflection on action and morality. The book clarifies and for the most part defends the way in which economists invoke preferences to explain, predict and assess behavior and outcomes. Hausman argues, however, that the predictions and explanations economists offer rely on theories of preference formation that are in (...) need of further development, and he criticizes attempts to define welfare in terms of preferences and to define preferences in terms of choices or self-interest. The analysis clarifies the relations between rational choice theory and philosophical accounts of human action. The book also assembles the materials out of which models of preference formation and modification can be constructed, and it comments on how reason and emotion shape preferences. (shrink)

Commodities and Capabilities presents a set of inter-related theses concerning the foundations of welfare economics, and in particular about the assessment of personal well-being and advantage. The argument presented focuses on the capability to function, i.e. what a person can do or can be, questioning in the process the more standard emphasis on opulence or on utility. In fact, a person's motivation behind choice is treated here as a parametric variable which may or may not coincide with the pursuit of (...) self-interest. Given the large number of practical problems arising from the roles and limitations of different concepts of interest and the judgement of advantage and well-being, this scholarly investigation is both of theoretical interest and practical import. (shrink)

Dan Haybron presents an illuminating examination of well-being, drawing on important recent work in the science of happiness. He shows that we are remarkably prone to error in judgements of our own personal welfare, and suggests that we should rethink traditional assumptions about the good life and the good society.

Many economic problems are also ethical problems: should we value economic equality? how much should we care about preserving the environment? how should medical resources be divided between saving life and enhancing life? This book examines some of the practical issues that lie between economics and ethics, and shows how utility theory can contribute to ethics. John Broome's work has, unusually, combined sophisticated economic and philosophical expertise, and Ethics Out of Economics brings together some of his most important essays, augmented (...) with an updated introduction. The first group of essays deals with the relation between preference and value, the second with various questions about the formal structure of good, and the concluding section with the value of life. This work is of interest and importance for both economists and philosophers, and shows powerfully how economic methods can contribute to moral philosophy. (shrink)

Egoism can be a descriptive or a normative position. Psychological egoism, the most famous descriptive position, claims that each person has but one ultimate aim: her own welfare. Normative forms of egoism make claims about what one ought to do, rather than describe what one does do. Ethical egoism claims that it is necessary and sufficient for an action to be morally right that it maximize one's self-interest. Rational egoism claims that it is necessary and sufficient for an action to (...) be rational that it maximize one's self-interest. (shrink)

This paper attempts to explain the conceptual connections between happiness and well-being. It first distinguishes episodic happiness from happiness in the personal attribute sense. It then evaluates two recent proposals about the connection between happiness and well-being: (1) the idea that episodic happiness and well-being both have the same fundamental determinants, so that a person is well-off to a particular degree in virtue of the fact that they are happy to that degree, and (2) the idea that happiness in the (...) personal attribute sense can serve as a ‘‘proxy’’ for well-being, i.e., that a person’s degree of deep or robust happiness approximates their degree of well-being. It is argued that happiness in both these senses is conceptually, metaphysically, and empirically distinct from well- being. A new analysis of welfare, well-being as agential flourishing, can explain welfare’s real connection to happiness in both the episodic and personal attribute senses. It predicts that such happiness is only directly beneficial when it is valued, when it is a form of valuing, or when it underwrites (i.e., serves as the causal basis for) the disposition to realize one’s values. It is therefore a necessary—but not sufficient—condition for especially high levels of well-being. This analysis of welfare integrates many insights from the eudaimonic tradition of welfare and happiness research in psychology, and also addresses common criticisms of these eudaimonic models. (shrink)

Modern reflection about the good life and the good society has been dominated by a spirit of liberal optimism, according to which people typically know what’s good for them and make prudent choices in pursuit of their interests. As a result, people tend to do best, and pretty well at that, when given the greatest possible freedom to live as they wish. This appealing doctrine rests on a bold assumption about human psychology: namely, that people have a high degree of (...) aptitude for securing their well-being given arbitrarily high levels of “option freedom.” Yet a large body of empirical research suggests that people are systematically prone to make a variety of serious errors in the pursuit of happiness. These errors are probably serious enough to place liberal optimism’s psychological assumptions in doubt. If people do tend to fare best in the option-rich environments traditionally favored by liberal moderns, notably classical economists, this may not be mainly through the prudent exercise of choice. Or perhaps human beings actually benefit from certain constraints or burdens on choice. (shrink)