Social thinkers frequently remind us that people differ in their views on what constitutes personal well-being, but that even when they don't differ, they disagree over the extent to which one person's well-being can be permitted to be traded off against another's. In this paper I show, by offering an account of the development of development economics, that in professional debates on social policy, economists speak or write as though they agree on values but differ on their reading of facts. (...) A number of ethicists have concluded from this near-exclusive interest in facts that modern economics must be an ethical desert. It is shown here that the reason research economists analyze facts rather than values is that modern economics is built on broad ethical foundations, capable of being reduced as special cases to the various ethical theories that are currently on offer. Ethics has taken a back seat in modern economics not because contemporary economists are wedded to a “value-free” enterprise, but because the ethical foundations of the subject were constructed over five decades ago and are now regarded to be a settled matter. (shrink)

In Human Well-Being and the Natural Environment, Partha Dasgupta explores ways to measure the quality of life. In developing quality-of-life indices, he pays particular attention to the natural environment, illustrating how it can be incorporated, more generally, into economic reasoning in a seamless manner. Professor Dasgupta puts the theory that he develops to use in extended commentaries on the economics of population, poverty traps, global warming, structural adjustment programmes, and free trade, particularly in relation to poor countries. (...) The result is a treatise that goes beyond quality-of-life measures and offers a comprehensive account of the newly emergent subject of ecological economics. (shrink)

As part of an article symposium on their “Narrow Identities”, Partha Dasgupta and Sanjeev Goyal respond to commentaries by Jean-Paul Carvalho, John B. Davis, Peter Finke, and Miriam Teschl.

In Human Well-Being and the Natural Environment, Partha Dasgupta explores ways to measure the quality of life. In developing quality-of-life indices, he pays particular attention to the natural environment, illustrating how it can be incorporated, more generally, into economic reasoning in a seamless manner. Professor Dasgupta puts the theory that he develops to use in extended commentaries on the economics of population, poverty traps, global warming, structural adjustment programmes, and free trade, particularly in relation to poor countries. (...) The result is a treatise that goes beyond quality-of-life measures and offers a comprehensive account of the newly emergent subject of ecological economics.With the publication of this new paperback edition, Professor Dasgupta has taken the opportunity to update and revise his text in a number of ways, including developments to facilitate its current use on a number of gradate courses in environmental and resource economics. The treatment of the welfare economics of imperfect economies has been developed using new findings, and the Appendix has been expanded to include applications of the theory to a number of institutions, and to develop approximate formulae for estimating the value of environmental natural resources. (shrink)

Combining a global approach with examples from everyday life, Partha Dasgupta describes the lives of two children who live very different lives in different parts of the world: in the Mid-West USA and in Ethiopia. He compares the obstacles facing them, and the processes that shape their lives, their families, and their futures. He shows how economics uncovers these processes, finds explanations for them, and how it forms policies and solutions. Along the way, Dasgupta provides an intelligent (...) and accessible introduction to key economic factors and concepts such as individual choices, national policies, efficiency, equity, development, sustainability, dynamic equilibrium, property rights, markets, and public goods. (shrink)

This chapter offers a framework for developing the notion of inter‐generational well‐being, or ‘social well‐being’ for short.

Reasons for seeking an index of social well‐being are identified in this chapter. Four are given prominence: to compare well‐being across countries ; to compare well‐being across time and generations for the same country ; to check if well‐being is sustainable; and to derive a criterion for judging if a policy is worth undertaking. There is no a priori reason why the same index would be appropriate for the four sets of exercises.

Illustrates how the concept of current well‐being can be put to work on the contemporary world. I draw upon evidence from the contemporary world's poorest countries to suggest that, interestingly, the three constituent spheres of citizenship may well be synergistically related to one another. The findings indicate that democracy and civil liberties are not only intrinsically valuable, but may even be instruments for bringing about material progress in poor countries. The fact remains though that, within democratic countries, there are enormous (...) differences in people's life chances. Democracies in poor regions harbour malnourished people. It is argued that the malnourished are caught in poverty traps. In order to explain the findings, we are led to study institutions and the role they play in determining the allocation of resources. (shrink)

It is shown that the correct way to evaluate a public project is to compare reductions in consumption arising from the investment outlay with the increase in wealth that the investment helps to create. Putting it in other words, projects should be accepted if they add to wealth, but not otherwise. It is also shown that for public projects this amounts to estimating the present discounted value of the flow of the project's social profits. A project whose PDV is positive (...) should be accepted; one whose PDV is negative should be rejected. The correct measure of social well‐being, even for purposes of project evaluation, is wealth. The finding unifies valuation and evaluation. (shrink)

Three systems of rights to natural resources are studied in Ch. 7: private, communal, and state. Institutional failures are shown to be the cause of inefficiencies and inequities, both in momentary allocations of resources and in the inter‐generational transfer of resources. It is argued that in the world we have come to know, there is a bias in the use of the natural environment, in that use at any moment is excessive, not insufficient. Since observed prices frequently do not reflect (...) the social worth of natural resources, use should be made of notional prices, called accounting prices. (shrink)

Offers an outline of a theory of population ethics, based on an especially strong conception of personhood that performs well when put to work in a world facing environmental constraints. The subject is controversial, and the treatment of it possibly is even more so.

Practical problems of estimating accounting prices are discussed in Ch. 8. Their resolution requires attention to ecological matters, such as the role of biodiversity in creating substitution possibilities among various kinds of natural resources. The chapter also summarizes methods for estimating the accounting prices of environmental resources.

Social thinkers frequently remind us that people differ on what constitutes personal well-being, but that even when they don't differ, they disagree over the extent to which one person's well-being can be permitted to be traded off against another's. They tell us that political differences are to be traced to differences in people's conceptions of personal and social well-being. We are given to understand, in other words, that people's ethics differ.

In order to identify usable indices, measures of well‐being are classified according to whether they are based on well‐being's constituents or their commodity determinants. For practical purposes, it is often simpler to construct measures based on well‐being's commodity determinants.

Discusses policy change in the midst of markets and non‐market institutions. Accounting prices are particularly difficult to estimate in non‐market institutions because of an absence of market prices to serve as guide. Moreover, changes in public policy frequently affect the macro‐economy. Involving as they do large changes to an economy, their evaluation requires more complex estimation procedures. Accounting prices don’t suffice. By means of three examples, I offer a sketch of how social cost–benefit analysis is useful for identifying what the (...) evaluator ought to try to measure and why. The first example is a miniature, involving communal management of irrigation systems in Nepal; the latter two are altogethergrander, illustrating some of the environmental implications for poor countries of structural adjustment programmes and trade liberalization. (shrink)

Studies a comprehensive, but operational, notion of current well‐being, and develop ways of measuring it. In order to find a usable measure of current well‐being, I appeal to an overarching idea of citizenship, with its three constituent spheres: the civil, the political, and the socio‐economic. The classification is useful for identifying the constituents of well‐being. The idea of citizenship is useful also in that it directs us to study the kinds of institutions that are best suited to protect and promote (...) human interests. Political scientists have shown that democracy is neither necessary nor sufficient for civic co‐operation and the benefits that come with it. (shrink)

A pluralist conception of personal well‐being is advanced. The conception includes the material sources of well‐being and the ability of a person to exercise various kinds of freedom. It is argued that social well‐being is an aggregate of individual well‐beings. It is shown that, if undertaken with care, the aggregation exercise doesn’t blunt human rights.

Reviews a widely discussed theory of population ethics, Classical Utilitarianism. It is less vulnerable to scrutiny than Average Utilitarianism, though it may recommend population levels that may seem excessive to many.

This chapter reviews a widely discussed theory of population ethics, Average Utilitarianism. Its ethical foundation as a population policy seems to have fundamental problems.

Develops the concept of sustainable development and shows how it is related to the maintenance of social well‐being through time. It is shown that wealth, estimated in terms of accounting prices, serves admirably as an index of well‐being over time and across generations. A country's wealth measures the social worth of its capital assets. The notion of wealth developed here is a comprehensive one, including in it the social worth of manufactured and human capital, public knowledge, and natural capital. Given (...) that movements in wealth over time measure movements in social well‐being, the object of study is then shown to be genuine investment, the social worth of net changes in an economy's capital assets. Thus, ensuring that social well‐being is sustainable involves taking care that the economy's assets are managed well. The theory is also put to work on contemporary data from the poorest countries in the world. Movements in the wealth of nations present a vastly different picture from the one gleaned from the two most popular measures of social well‐being. A substantial reassessment of the post‐war development experience among poor countries is now needed if sustainable development is to be anything more than a slogan at national and international conferences. (shrink)

In developing the basis on which climate change should be priced, I do five things. First, I review the ethical foundations for valuing future consumption relative to present consumption (i.e. social discount rates). Second, I report that the criterion for both assessing and prescribing economic policies should not be an economy's GDP, but an inclusive measure of an economy's wealth adjusted for the distribution of wealth. Third, I apply the resulting analysis to the problem of pricing carbon concentration in the (...) atmosphere. I give prominence to future uncertainties. Fourth, I show that the existing models of human behaviour on the basis of which these questions have been analysed by economists have serious deficiencies, in as much as the idea of personhood embodied in them has been built on the psychology of confirmed egotists. Fifth, I sketch the motivations of a social being and show how the altered specification of the human person affects the social price of climate change. (shrink)

Scrutinizes a class of accounting prices that has been the object of regular misunderstanding: social discount rates. The topic is over 40 years old, yet controversy rages over matters that have long been settled, involving as they do technical economics. Many who express views on social discount rates overlook the literature and make incorrect claims. I point to a few as the occasions warrant.

This article reports on a conversation convened by Quentin Skinner at the invitation of the Editors of The Journal of Political Philosophy and held in Cambridge on 13 February 2001.

Economists have in recent years found the theory of games to be an attractive route for exploring imperfectly competitive markets. In this collection of articles, some of the best minds in contemporary economics on both sides of the Atlantic explore both the potential and the limitations of this theoretical framework.