A collage of images, featuring most prominently a person holding a sign reading "no justice no peace"

Category: Economics

Democracy / Economics / Liberty

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What can republicanism offer the left?

the republican magazine

When you tell people that you work on republicanism, you are often met by a concerned look. You then have to rush to explain that by ‘republicanism’ you, of course, do not mean the party of Trump and Palin. Nor – you then have to add – do you only mean that you take a particular dislike to Elizabeth Windsor. This public understanding of republicanism looks set to only get worse, with the French centre-right UMP party, last year, successfully renaming itself Les Républicains.

The prospects for recovering republicanism for leftist politics might therefore not seem particularly promising. The label ‘republican’ might simply be too poisoned by its associations with right-wing parties or too easily reduced to narrow anti-monarchism, to be of much use to radicals and progressives. Yet, despite these concerns, I do think that republicanism has something to offer to the left.¹ I believe that its values of popular sovereignty, civic virtue and freedom, and the political proposals we can draw from them, make a recovery of republicanism attractive.

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Democracy / Economics / Moral values

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How do people vote against their own interests?

I spend a disproportionate amount of my free time following the ins and outs of American politics. And one of the most interesting/baffling things about the nominations for the 2016 presidential election is the sheer capacity of the average Republican voter to stomach policy proposals that seem tailor-made to benefit the tiny minority of the wealthiest at the expense of everybody else. For example, all of the Republican front-runners have come out with some form of tax plan that cuts taxes on the wealthiest 1% by hundreds of thousands of dollars. Yet this doesn’t scare away nearly as many voters as you’d expect — in fact, the race is wide open, and some pundits even suggest the GOP are favourites at this stage. Voting against your own interests is, arguably, a global phenomenon – I’m sure many in the UK will say it happened in the elections in May – but it does seem to be particularly prevalent in the US, perhaps because one of the parties has moved so far to the right on social and economic issues that there is not yet any equivalent in Europe.

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Economics / Liberty

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On ‘negotiating the balance between personal freedom and really cool free stuff’

Imagine you are watching your favourite TV show and its protagonist walks to the fridge and gets out a drink (or: gets into a car, answers their phone, walks past a billboard, pours breakfast cereal into a bowl – you get the picture). Unbeknownst to you, the actual drink that you see them take out of the fridge is dependent on factors about you, such as your geographic location: you see the character pull out a Diet Coke, for instance, while another person on the other side of the world watching the same episode of the same programme at the same time sees them take out a particular brand of iced tea.

You have (both) just been subject to a new type of advertising practice known as ‘digital insertion’ – a much more technologically-sophisticated, targeted version of product placement.  (more…)

Distribution / Duties / Economics / International

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(One of) Effective Altruism’s blind spot(s), or: why moral theory needs institutional theory

Blick aus dem Bürofenster kleinThere has been much talk about effective altruism recently (see e.g. here or here) – the idea that you should try to do as much good as you can, using the most effective means. It reads a bit like an update of good old Jeremy Bentham and “the greatest happiness of the greatest number” by a McKinsey consultant. It is easy to ridicule, and ridicule is indeed a frequent reaction because humour eases the tension that one can feel when confronted with these ideas. For there seems to be more than a grain of truth in effective altruists’ claim that we could do so much more to help those who were less fortunate in the “natural lottery” of where and when they were born. One thing that speaks in their favor, after all, is that effective altruists ask serious questions about what it means to be a moral agent in today’s world. What I here want to pick out from the debate is their picture the social world and of human institutions, which I take to be flawed. It is an illustration of why moral philosophy should not neglect the world we live in and the institutions that structure it.

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Democracy / Distribution / Economics / Governance

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Sacrificed for hope?

Sacrificed for hope?

Economic transition and intergenerational justice

« Poverty and oppression are here, and they will not

be alleviated by the possibility of a better future.”

Adam Przeworski

Suppose you believe that the nationalization of the means of production is necessary for the achievement of justice. Suppose, besides, that your political party enjoys enough popular support (an absolute majority) for this radical reform. Yet you know from experiences in other countries that such radical reforms engender an economic crisis, with higher unemployment and lower incomes. What you do not know is how the economy is going to fare in the future and how long the crisis can last.

These are a lot of assumptions, certainly, but please accept them for the sake of the argument. What I am asking you is to put yourselves into the shoes of western European socialist leaders from the first half of the 20th century. They faced both a strategic and an ethical dilemma. (more…)

Economics / Old Blog

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Beneficial competition or attack on legitimate interests: What to make of Uber’s disruption of the taxi industry?

Imagine you are standing on the street and waiting for a taxi to take you home. While you are having second thoughts as to whether the convenience of a taxi ride is really worth the cost, a private car stops in front of you and the person at the steering wheel offers to drive you home for a price significantly below the taxi rate. Once you have convinced yourself of the driver’s competence and reliability, what could possibly speak against accepting the offer? Not much, it may seem.

Granted, the scene just described may appear too unrealistic to merit serious ethical reflection. In cities around the world, however, smartphone technology has recently led to a surge of structurally similar situations. Ride-hailing platforms that act as brokers between private drivers and potential clients have been experiencing rapid growth and offer rates that are often below those of established taxi industries. Uber, the most prominent example, has extended its operation to 54 countries and has created headlines by attracting more than $2bn of investment during the last two years. In many places, however, this expansion has been accompanied by fervent political controversy, and in a number of jurisdictions regulatory opposition has brought Uber’s operation to a halt.

Some of the criticisms voiced in opposition to Uber reflect concerns that seem relatively uncontroversial. For example, the enforcement of adequate safety standards in cars (including mandatory liability insurance for drivers) and appropriate forms of taxation appear to represent valid objectives, both from the point of view of public interest and in terms of ensuring a level playing field in Uber’s competition with traditional taxi providers. At the same time, these objectives do not necessarily conflict with Uber’s business model. Assuming that drivers are subject to the same safety and tax requirements as traditional taxi providers, Uber may still be able to offer lower fares. In the following, I would like to consider two additional concerns that are more fundamentally connected to the way Uber operates and that also seem more difficult to evaluate.

The first concern relates to the interest of drivers that rely on their job as a primary source of income. One of the prominent complaints of taxi associations has been that Uber’s competition threatens the ability of professional drivers to make a living from their occupation. While Uber argues that its drivers are able to achieve incomes far above the average income of taxi drivers, protests by Uber drivers cast doubt on the generalisability of this claim. Moreover, recent data shows that the majority of drivers do not treat Uber as their main source of income, which in turn may contribute to the preparedness of Uber drivers to work for lower rates. If it is indeed the case that Uber’s business model poses a threat to the interest of drivers in being able to make a living from their occupation (be it in the traditional taxi sector or after a switch to Uber), does this interest provide a legitimate basis for banning Uber?

On the one hand, Uber would appear to exemplify the general potential of freelance working arrangements to erode income levels. Given that earnings in the established taxi industry are already at the low end of the income spectrum, we may think that, if anything, policy should aim at improving wages in the taxi industry, e.g. through appropriate minimum wage legislation, rather than allowing income levels to be threatened by Uber’s business model which, in virtue of treating drivers as individual contractors, is not bound by wage regulations. On the other hand, the interest to make a living from taxi driving would have to be defended against the interest of those who are willing to offer their service at a lower price, if only as a partial source of income, and would be prevented from doing so through an ban of platforms such as Uber. Such a defence, it seems to me, cannot necessarily be taken for granted. A judgment on the issue would have to take into account the level of material well-being and the occupational alternatives of both groups.

Setting aside the interest of drivers, the second concern may be cast in terms of public or general interest. While taxi rates are legally regulated, ride-hailing platforms are free to set their prices according to demand and supply. Uber, for example, relies on rate increases in times of high demand in order to incentivize additional drivers to offer their services. As a result, on holidays or in situations of emergency, fares can increase up to fourfold, to levels far above standard taxi rates. Regulated taxi fares, in contrast, may be thought to serve an important public interest in the availability, in general, of rides at rates that are affordable for a relatively wide section of the population. To the extent to which the success of Uber and other ride-hailing platforms leads to an erosion of the supply of fix-rate taxis, people with urgent transportation needs may find themselves in situations without affordable options.

Is the interest in affordable rides compelling enough to justify a ban on unregulated services such as Uber in order to protect the supply of fix-rate taxis? The answer to this question does not seem obvious either. Among the countervailing interests to consider are the interests of customers who would take advantage of Uber’s service during times at which fares are below the taxi rate. Among them are equally going to be people with urgent needs, some of whom may in fact not be able to afford the regulated taxi fare. And to the extent to which the taxi fare is affordable for them, can they be expected to effectively subsidise the rides of others? One consideration that seems clearly relevant here is the existence of alternative modes of transportation that may serve to protect the interest in generally available affordable transportation. An answer thus appears even more context-dependent than in the case of the first concern. What do you think?

Democracy / Economics / Gender / Old Blog

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Defending Quotas

 
 
We live in a society that contains severe gender injustice. One way in which to combat this injustice is via the use of quota policies. A quota policy is a policy that requires that members of certain specified groups to make up some stipulated minimum complement of an organisation or group of organisations. For example, we may require women to constitute at least 40% of non-executive board directorships. The use of quotas can be a highly effective tool for changing or maintaining the make-up of an organisation or group of organisations, especially when accompanied by harsh penalties for non-compliance with the quota policy.
Despite these credentials, the use of quota policies remains hotly contested and highly controversial. Indeed, the use of quota policies has been much more politically and constitutionally controversial than the use of other affirmative action policies, such as those that involve giving greater weight to applications from members of certain specified groups. I take it that part of the reason for this is that quota policies run the risk that worse candidates will be hired at the expense of better candidates. In other words, quota policies risk being genuinely discriminatory. The same risk does not arise with respect to policies that give greater weight to applications from members of certain specified groups. This is because the purpose of this greater weight can plausibly be seen simply as counterbalancing the effects of certain discriminatory norms, such as gendered social norms.
Even though quota policies risk being genuinely discriminatory, I believe that we should be prepared to defend their use. To this end, I shall make two points. First, as I have suggested, quotas can be highly effective, much more so than other affirmative action policies. As an illustrative example, let’s consider ‘reaction qualifications’ – that is, qualifications that a candidate possesses by virtue of others’ reactions to them. One stubborn way in which sexist discrimination occurs is when an employer rejects a female candidate’s application on the basis of how it is expected other people (other staff, customers, etc.) would interact with her. A quota policy provides a way in which effectively to challenge the effect of reaction qualification. Here, I agree with L. W. Sumner, who writes:
An employer who needs to hire women in order to meet a stipulated quota will be less likely to worry whether this particular woman is too pushy, or will not be a good team player, or is likely to get pregnant, or whatever. Although numerical quotas will come as an acute shock to many employers, I know of no other way to concentrate their minds as wonderfully on the genuine qualifications of female job candidates (214).
Second, the defence of the use of quota policies is strengthened if we can offer a reply to those who resist their use on the grounds that they run the risk that worse candidates will be hired at the expense of better candidates. This objection is typically put in terms of an appeal to rights and, in particular, the rights of the best qualified candidates. One fundamental problem with this objection is that it is insufficiently sensitive to costs that are imposed by the absence of a quota policy. At least in the short run, the alternative to the introduction of a quota policy is the survival of unjust discrimination, which leads to widespread rights violations. In short, if my first point in defence of the use of quota policies is correct, then we should conclude that there is no way to avoid imposing morally objectionable costs, at least in the short run. This is important as I think we should prefer imposing costs, as quota policies do, with the aim of minimising these costs in the long run, by moving towards a more just society.
To be sure, I do not claim that the use of quota policies is sufficient to end gender injustice. No doubt that, in addition to quota policies, we must pursue other goals to combat the causes and effects of gender injustice, such as challenging certain gender stereotypes and restructuring socio-economic institutions to protect greater and more equal opportunities. Nor do I claim that the use of quota policies is always necessary. In some cases, a quota policy may be futile and, if this is the case, it may risk being harmful. I support the more modest claim that we should in principle be prepared to use quota policies to combat gender injustice; that is, I believe that the quota policy is a legitimate weapon in our arsenal.  

 

Economics / Old Blog

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Can Grading Love & Care be an Injustice?

Can grading love and care (and other goods) be an injustice?
It is a widespread intuition that some things in life cannot and should not be measured. For example, quantifying our love for a partner seems problematic. We do not want to rate our affection on a scale of 0-100.*  It is an important question, though, whether we can have a complaint of justice about measuring certain goods.  Here I consider two lines of argument for thinking that measuring certain things in quantifiable terms can be objectionable.
The first is indirect. It concerns unjust effects of things being measured that were not measured previously. An example is the measurement of the willingness to pay for parking spaces, which Joshua Kopstein recently discussed. Some start-up companies have developed apps through which people bid for spare parking spaces. Kopstein suggests that this system turns a public good into a private good that is allocated according to willingness and ability to pay, thus privileging the rich. This example does suggest that certain kinds of measurement can lead to complaints of justice, if they introduce an allocation mechanism that is not appropriate for the good. But in such cases it is the possibility of wrongful use, not the measuring itself, that can be criticized.
The second way in which measuring could raise complaints of injustice is more direct. Consider a stylized example. Assume that elderly relatives have a legitimate claim to receive some acts of love and care from younger family members. Assume that a start-up company develops an app that evaluates family members, on a score from 0 to 100, on how well their acts deliver care to elderly relatives. And assume that using the app becomes a social trend, such that most people start using it. This might have some beneficial effects. For example, it might become easier to share knowledge about how to cheer up grandma “efficiently” when she is gloomy. But could it also mean that what the elderly relatives receive are not, any longer, acts of love and care, but something else: acts calculated to enhance the wellbeing of elderly relatives? If this is the case, it seems that they could raise a claim of justice. They are denied what they have a legitimate claim to receive. Schematically put, they have a legitimate claim to good X (love and care), but what they receive is good Y (acts that will efficiently enhance wellbeing), because by measuring and quantifying X, it is transformed into Y.
One problem here is whether we can specify a sufficiently clear and plausible account of what good X is and why good Y is different from it.** One possible issue might be that good X is a complex and multi-dimensional good, but by measuring it, we necessarily reduce it to fewer dimensions. Although modern technologies offer increasingly sophisticated ways of measuring things, they still cannot capture all the dimensions of what it means, for example, to have a trusting and loving relationship with someone. Another issue could be that offering good X requires openness to new challenges or a certain degree of spontaneity. Again, these cannot be easily captured in quantitative terms and are, thus, likely to be excluded if one tried to measure X. For example, an important aspect of a loving relationship is that one is sensitive to subtle changes in the other person’s situation, and maybe even that one understands such changes before the person herself fully understands them. It is therefore unclear how they could be included in quantitative measures.
Certain forms of measurement may be simply dysfunctional. In finance, there is Goodhart’s law: “When a measure becomes a target, it ceases to be a good measure.” This might also hold for other areas and make it simply unwise to try to utilise measurements there. But in additional to dysfunctionality, we should not exclude the possibility that measuring certain things may be an injustice.  At least in the case of care and love, it seems there is reason to believe that that is the case.
*In Dave Egger’s The Circle there is an episode in which one of the protagonist’s lovers asks for an evaluation of his qualities, on a scale from 0 to 100, directly after the sexual act. The protagonist is somewhat startled, and then resorts to a white lie.
**Aspects of this question have been explored in the debate about limits of the market, where one concern is whether the socially defined “meaning” of goods can be a basis for not measuring goods in market terms. See for example Debra Satz’s discussion of Elizabeth Anderson’s approach in her Why Some Things Should Not Be For Sale.

Distribution / Duties / Economics / International / Old Blog / Rights

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Taxing FIFA: Asides from having their board room modelled on the war room from doctor strangelove, are there any other reasons as to why FIFA should be taxed?

Some have called it the best football World Cup ever. And it has indeed been incredibly exciting.[1]Yet the circumstances which brought us the event (and will bring us future ones) are very troubling. For a year now, there has been widespread anti-World Cup protests and riots in Brazil crying against the high cost of the event for Brazilian citizens. Investigationshave revealed the slave conditions migrant workers building the 2022 World Cup infrastructure are subject to in Qatar. At the same time, there has been renewed criticism directed at FIFA, football’s international governing body. There are corruption scandals, FIFA’s dismissive attitude to the Brazil riots, their inaction on the Qatar front, and then there is the tax issue.
FIFA demands from any country who wishes to bid for hosting the world cup full tax exemptions for itself and its subsidiaries and tax breaks for its official sponsors. Estimates are that tax exemptions in Brazil, for instance, will cost up to half a billion dollars.  To many this sounds outrageous (see video).  And so it does to me.
John Oliver on Last Week Tonight tells us perfectly why we should hate FIFA
But why exactly is it outrageous?
Some, including FIFA and the Brazilian government, have argued that the country hosting the World Cup stands to greatly benefit economically from the infrastructure investments and tourism, a benefit that surpasses the amount of tax exemption in question.  Whether such forecasts about the benefits to the host country are correct is highly contestedas these rosy forecasts do not take into consideration many indirect social and economic costs (worker deaths, security costs, crowding out other tourists, etc…)An indication that hosting events such as the World Cup is unattractive even to the richer countries is the fact that only three European countries bid to host to the European Championship in 2020.

But is the issue only a question of mutual benefit? Surely we don’t expect countries to provide corporations or investors with full scale tax exemptions on the account that they generate net benefits to the economy. Countries are perhaps often forced to provide incentives for investors and corporations due to tax competition but this is reason to call for more global tax harmonization. And whereas companies and investors competing against one another may, in at least some way, be justified to seek conditions that render them competitive FIFA has no competitor. It is the sole body responsible for organizing the World Cup. And, it is a non-profit organisation.
Perhaps it being a non-profit organization can actually justify the tax exemption. After all , it is common, and we often think laudable, to exempt non-profit organization from taxes. The fact that FIFA actually makes a lot of profit (in 2012 it was $ 89 million)  often raises eyebrows, but I don’t think this is in itself the issue. What makes an organization non-profit is not that it doesn’t make profit but that it does not distribute its profits or dividends to shareholders and instead uses its profits to further achieve or promote its goals.

We definitely have some good reasons to exempt some non-profit organizations from taxes irrespective of the profit they make or the net economic benefit that accrues from their activities. We do, for example, want to have organizations that track human rights abuses. Evidence that they make huge profit or that their net financial benefit locally or internationally is negative is not reason against exempting them from taxes as long as we know that their profits are being invested to pursue their aims. To the contrary, the more profit they make the better!
Protecting and tracking human rights abuses is an aim we want to pursue even at a large financial cost. Yet, it is not clear that this applies to the variety of aims pursued by the variety of non-profit organisations. It is certainly not clear when it comes to FIFA whose aim is to promote sports and football. Yes, there are the commitments to anti-racism and anti-discrimination, but there is little done to prove them more than slogans. Perhaps if serious effort were being done to promote those aims; if FIFA for instance were to be a driver for labor law reforms in countries like Qatar; or if it were successful in promoting other humans rights (say the right of children in poor countries to play in safe environments) then this could be good reason to exempt them from taxes. That said, even if such were the case, the tax burden ought not to fall on the hosting country but be fairly distributed on the international community.
Absent such aims, the question of whether promoting football is a ‘worthy’ pursuit, perhaps like the question of promoting some forms of art, ought to be settled democratically. This would exclude non-democratic countries from bidding for the world cup, but that doesn’t strike me as an outrageous conclusion.

[1] Until the last of three teams I supported returned home, that is.

Duties / Economics / Gender / Old Blog

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Does systemic injustice justify Robin Hood Strategies?

Does systemic injustice justify Robin Hood strategies?
Many injustices arise because of patterns of behaviour, single instances of which seem harmless or at least pardonable. For example, if professors help the kids of their friend get access to university programs – and given the fact that professors and their friends tend to come from the same socio-economic background – this can lead to structural discrimination against applicants from other backgrounds (as discussed by Bazerman and Tenbrunsel here, p. 38-40). Other examples concern implicit biases against women and ethnic minorities. Much work has been done recently that helps us to understand how these mechanisms work (see e.g. here). Given how pervasive these mechanisms are, it is understandable that they cause moral outrage. The question is, however, what individuals should do in reaction to them.
Imagine that you are in a situation in which you have some amount of power, for example as a reviewer or as a member of a search committee. You might be tempted to use a “Robin Hood strategy”, i.e. a strategy that breaks the existing rules, for the sake of supporting those who are treated unjustly by these rules. Given how structural injustices work, many such “rules” are not formal rules, but rather informal patterns of behaviour. But it is still possible to work against them. For example, could it be justified to reject male applicants not because of the quality of their applications, but because they are white and male and come from a rich Western country?
One has to distinguish two levels of what such a strategy could imply. The first concerns correcting own biases that one might have, despite all good intentions (to check them, the various tests offered by Harvard University on this website can be helpful). The best way to do this, if possible, seems to be anonymity. When this is not feasible, the alternative is to scrutinize one’s patterns of thought and behaviour as best one can. The more power one has, the more it seems a requirement of justice to do this.
This is different from a second level of Robin Hood strategies, for which the name seems more appropriate: these concern not only own biases, but biases of the system. The idea is to work against them on one’s own, in one’s little corner, maybe hoping that if enough of us do this, the problems can be solved or at least attenuated. Could this be a defensible strategy?
The problem is, of course, that one risks introducing new injustices. One consciously deviates from what are supposed to be the criteria of selection, for example a candidate’s performance in previous jobs or the likelihood of being a good team member. In some cases, however, it is reasonable to assume that if a candidate comes from a group that suffers from discrimination, achieving the same level of merit as a candidate from another group takes much more effort. So according to this argument, and as long as these problems are not recognized by the official selection criteria, it seems defensible to privately factor in these previous structural inequalities.
But one’s epistemic position in judging such cases is often a weak one. For example, standard application material for many jobs includes a CV and some letters of reference. These materials are often insufficient for understanding the details of a specific case and the degree to which discrimination or stigmatization might have had an impact on the candidate’s previous career. One risks making mistakes and importing one’s own subjective biases and prejudices; taken together, this can make things worse, all things considered.
Robin Hood strategies do not provide what seems most needed: good procedures and public accountability. They do not get at the root of the problem, which is to create collective awareness of the issues, and to find collective mechanisms for addressing them (the gendered conference campaign is an example). Collective mechanisms are not only likely to be more effective, they also bring things out into the open, and create a public discourse on them. Although public discourses also have their weaknesses, there is at least a chance that the better argument will win, and there are opportunities for correcting what end up misguided strategies. Robin Hood strategies, in contrast, fight fire with fire: they remain within a logic of power, trying to find ways in which one can use counter-power to subvert the dominant power elites. But this does not change the fundamental logic of the game.

Thus, our preferred strategies should be different ones: strategies that really change the logic of the game, openly addressing problematic patterns of behaviour and looking for collective – and maybe formally institutionalized – solutions. Nonetheless, and despite all the reasons mentioned above, I cannot bring myself to thinking that Robin Hood strategies can never be justified in today’s world. Of course one has to be very careful with them, not only with particular cases, but also with regard to the slippery slope one might get onto. But are they ruled out completely? What do you think?