Economics and Ethics

As someone with a PHD in Social Ethics, I tend to see economic issues as intimately connected with ethical  issues. Take the economic practice of doing a cost-benefit analysis. You could spend one hundred dollars for a night on the town, or you could donate that one hundred dollars to the reelection campaign of your favorite politician. Which option is better? The night on the town increases pleasure. A politician’s successful campaign may lead to more liberty in the long term. We regularly make decisions like this, weighing our options by measuring their likely costs and likely benefits against each other.

This connects economics directly to a major issue in ethics: By what standard do we determine what counts as a benefit or a cost? A list of competing candidates for the status of ultimate value standard includes happiness, satisfying the will of God, long-term survival, liberty, duty, and equality.

Economists implicitly adopt a value framework when beginning a cost-benefit analysis. Different value commitments can lead to the same item being considered a cost from one perspective and a benefit from another. For example, those whose standard of value is increasing human happiness would count a new road to a scenic mountain vista as a benefit, while those whose standard is maintaining an unchanged natural environment would count it as a cost.

The results of economic analysis also lead directly to ethical issues. For example, one result of the nineteenth- and twentieth-century debate over capitalism and socialism is a general consensus that capitalism is effective at producing wealth and socialism is effective at keeping people poor. Advocates of capitalism use these results to argue that capitalism is good; others might respond that “socialism is good in theory, but unfortunately it is not practical.” Implicit in the capitalist position is the view that practical consequences determine goodness. By contrast, implicit in the position of those who believe socialism to be an impractical moral ideal is the view that goodness is distinct from practical consequences.

A common assumption of economic analysis is that individuals are rational and self-interested. In your statement, you need to explain to the Admission Committee how it is in your rational self-interest to embark upon graduate school in economics. Tell me how you feel about these issues, as this will help to direct me. Is self-interest moral, amoral, or immoral? Is morality a matter of individuals taking responsibility for their lives and working to achieve happiness? Or is morality a matter of individuals accepting responsibility for others and being willing to forgo or sacrifice for them? This is the debate in ethics between egoism and altruism and it is of central importance to the applicant seeking to undertake graduate study in economics.

Personal Statement of Purpose for Admission to Graduate School in Economics, Master's, Doctorate. Building new understandings of Economics as a human centered reality in need of rigorous humanistic investigation.

 We share a critical stance towards conventional or traditional economic theory insofar as it has all too often tended to appeal to a most abstract version of humanity. Many economists share our opinion that it is not necessarily human nature to always prefer more wealth to less; and subsequently, we feel that this assumption does not serve as an adequate theoretical basis for a science of political economy. Unfortunately, today this dominant understanding of human economic activity which paints us all as greedy, self-seeking creatures has tended to become the unquestioned ‘truth’ that has led to many of today’s social and environmental problems.

 Just as the desire for more wealth clearly does not define our every action, the humanist critique of modern economics includes the assertion that ‘what is economically rational is often socially or morally unreasonable’. In all aspects of life we face choices that could lead to many different outcomes. Nevertheless, it is exactly this human choice that is ignored in economic rationality, which is myopically concerned only with the satisfaction of self-interest.

 We draft eloquent, incisive statements with a humanistic emphasis and we do so on behalf of clients from around the world who are applying to graduate school in Economics. When you fill out our Online Interview Form, please provide us with the link to the program to which you are applying. This way, we can make your statement much stronger by tailoring it to that particular program and what that program is looking for in an applicant.

Beautifully crafted statement, thanks.

C.E. (Application for Master’s in Economics April 2011)