A market for values as an instrument to reconcile economics and ethics, individual and community
I am very interested in the debates which take place in the OECD Forum Network.
Against this backdrop, I am glad – as a purely personal initiative – to inform you of my proposal to create a market for experiences of values, as an attempt to reconcile economics and ethics, individual and community, capitalism and democracy. Considering the climate crisis we are going through, I find that environmental values would find a very relevant place in such project. I have recently presented this proposal at the last Annual Meeting of the Society for the Advancement of Socioeconomics (SASE) in Amsterdam.
Your opinion on this proposal and any possible cooperation would be much welcome.
The last 15 years have seen an increased polarisation of the economic and political debate. On one hand, deregulated markets have confirmed the neoliberal idea of an economics which is neutral towards values such as social justice. On the other hand, populist movements have fostered narratives based on values to be imposed in rhetorical ways, without the possibility for individuals to accept, refuse or contribute to the debate on these principles. Individualism and political communities are, as they are conceived by the average citizen, as distant as the politics adopted in the USA and the United Kingdom in the eighties of last century are distant from the controversial figures who are today fostering nationalism and denying climate change.
However, my basic assumption is that true individuality (as the ability to formulate value judgements independently from one’s current social role, and therefore through autonomy), unlike individualism guided by utility maximisation, is not only compatible with the build-up of really political, inclusive communities: individuality is a prerequisite for these communities. If individuals have not what I call functional autonomy (meant as the ability to choose and implement values as general narratives which go beyond mere interests conditioned by one's current economic and social role), then society is not also a community, and collective preferences are only an aggregation of individualistic ones, not also the outcome of a deliberative, inclusive and rational process.
This is an approach inspired by the political philosophies of Aristotle, Jean-Jacques Rousseau, Immanuel Kant, Hannah Arendt and John Rawls, as well as by the notion of agency analysed by Amartya Sen.
While many criticise markets as the cause of many problems of our times, a few focus on the value-neutral nature of the only medium of exchange which is used today, money. At the same time, the exclusive role of money as a medium of exchange and the dominant division of labour foster an instrumental form of rationality, where interests largely dominate autonomous values. Georg Simmel was very clear in indicating how in a monetary economy values become means, and what would be supposed to be a means becomes the only possible aim, able to transform each reality in something else.
Not only money (even cryptocurrencies), but also traditional barters start from the assumption that an economic agent can only perform a few, specialised, routinary roles.
A market for values
In order to foster individual autonomy, I have conceived the idea to create a centralised platform, which would offer an economic – a non monetary one - incentive to exercise individual autonomy, and, therefore, choose values before social roles, rather than the other way around.
In a nutshell, this instrument would allow economic agents (individuals, firms and local communities) to exchange documents, each of which would describe the benefits of adopting a given moral, organisational or cultural value. The experiences would be verified in terms of compliance with relevant indicators defined by law (for instance, in the case of environmentalism, a given increase in green areas in cities, or a given amount of time in green volunteering for individuals, or a given amount of investment in negative emissions, for firms). The benefits listed on a document should be objective, verifiable, and have a social, reputational or economic nature. Only after purchasing a document, it would be possible to know the compliance with which indicator (and therefore which social role) was associated with each of the benefits listed.
The documents would not be exchangeable with money, but only with goods and services or other documents. The price of the documents would be defined in terms of monetary value usable to purchase goods and services, and of basic units usable to get other documents. The initial level of the price of the experiences referred to a given value may be fixed on the basis of the average monetary cost of complying with the indicators referred to that value.
Unlike money, which is value-neutral, has no intrinsic value and which is the base for pricing all goods, the documents would have a price, which would be the product of the price of the experiences referred to the respective value (determined by supply and demand), times the number of experiences listed in the document. The possibility to price the medium of exchange would imply the possibility for producers of goods and services to enrich their social role, rather than simply confirm it. Indeed, changing such role and implementing a value would find an economic incentive in the possibility to transfer a document at a monetary equivalent higher than purchase price, by way of a) adding new experiences (agency aspect) and b) choosing a value which will become more demanded by the rest of participants (sensitivity to social preferences).
A first benefit of this market would be the possibility to foster individual (functional) autonomy, and therefore improve the ability to formulate value judgements which, according to welfare economics, are key to go beyond both mere Pareto optimisation and paternalistic notions of welfare.
Second, if this instrument involved a large part of society, it would contribute to building a community, meaning a collective reality with its own identity, that acknowledges individuality as freedom to choose an identity dealing with ends, rather than with means.
Finally, through this platform there would be a public assessment – based on the spontaneous interactions of individuals - of the relative importance of moral, organisational and cultural values, as measured by the dynamics of the relative prices of the experiences mentioned above: precisely because individual agents would choose and exchange values as something more than preferences oriented at getting monetary outcomes, economic interactions would not only be compatible with shaping a public notion of common good – and therefore the identity of communities -, but they would also be instrumental to such a notion.
I have dealt with this proposal in the following articles:
Thank you very much for your kind attention.