Founding moral reasoning on evolutionary psychology: A critique and an alternative.

At the heart of economics is an ethical story. From Adam Smith’s invisible hand (Smith, 1976) to Vilfredo Pareto’s innovation on the notion of optimality (Pareto, 1980) and Amartya Sen’s basic capability equality (Sen, 1998), economists do indeed preach the ethics of creative freedom and allocative justice. Yet, the charge, that homo economicus as a species — decked out in rational raiment and utilitarian hat — has limited imagination, is not exactly specious. Economics has repeatedly been criticized for its (presumably) arrogant presumptions to “hardness” as opposed to other social sciences. Philosophers have criticized its utilitarianism (Rawls, 1999); psychologists have criticized its rationality (Simon, 1959; Gigerenzer, 1999); sociologists have criticized its individualism (Merton, 1957; Joas, 1996); historians have criticized its static method (Galambos, 1988); and its own rhetoricians have criticized its metaphors (McCloskey, 1990). On the one hand, one could argue that the root cause of this astonishing barrage of critical attention focused on economics is precisely due to its unarguable success in the living vocabularies and actions of recent generations of educated human beings around the world. On the other hand, however, the particular charge being investigated in this essay is the failure of economics to date to incorporate the task of imagination within its domain and therein develop a useful theory of entrepreneurship.

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Saras Sarasvathy
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