philosophy and economics

The question usually addressed in any subfield of philosophy (the philosophy of X) is "what is X?". A philosophical approach to the question "what is economics?" is less likely to produce an answer than it is to produce a survey of the definitional and territorial difficulties and controversies. Similar considerations apply as a prologue to further discussion of methodology in a subject. Definitions of economics have varied over time from the modern origins of the subject, reflecting programmatic concerns and distinctions of expositors.For example:

• Roger E. Backhouse and Steven Medema (2008). "economics, definition of", The New Palgrave Dictionary of Economics, 2nd Edition. [http://www.dictionaryofeconomics.com/article?id=pde2008_E000291&q=definitions&topicid=&result_number=5 Abstract].
• _____ (2009). "Retrospectives: On the Definition of Economics", Journal of Economic Perspectives, 23(1), pp. [http://pubs.aeaweb.org/doi/pdfplus/10.1257/jep.23.1.221 221–33].
• Adam Smith ([1776] 1976). An Inquiry into the Nature and Causes of the Wealth of Nations. Oxford University Press. p. 428.
• John Stuart Mill (1844). "On the Definition of Political Economy; and on the Method of Investigation Proper to It", Essay V, in Essays on Some Unsettled Questions of Political Economy.
• Lionel Robbins (1932). An Essay on the Nature and Significance of Economic Science, Macmillan, p. 16.

Ontological questions continue with further "what is..." questions addressed at fundamental economic phenomena, such as "what is (economic) value?" or "what is a market?". While it is possible to respond to such questions with real verbal definitions, the philosophical value of posing such questions actually aims at shifting entire perspectives as to the nature of the foundations of economics. In the rare cases that attempts at ontological shifts gain wide acceptance, their ripple effects can spread throughout the entire field of economics.For example:

• Roger E. Backhouse and Steven Medema (2008). "economics, definition of", The New Palgrave Dictionary of Economics, 2nd Edition. [http://www.dictionaryofeconomics.com/article?id=pde2008_E000291&q=definitions&topicid=&result_number=5 Abstract].
• Uskali Mäki (2008). "scientific realism and ontology", The New Palgrave Dictionary of Economics, 2nd Edition. [http://www.dictionaryofeconomics.com/article?id=pde2008_R000248&q=ontology%20&topicid=&result_number=1 Abstract].

{{main|Economic methodology}}

An epistemology deals with how we know things. In the philosophy of economics this means asking questions such as: what kind of a "truth claim" is made by economic theories – for example, are we claiming that the theories relate to reality or perceptions? How can or should we prove economic theories – for example, must every economic theory be empirically verifiable? How exact are economic theories and can they lay claim to the status of an exact science – for example, are economic predictions as reliable as predictions in the natural sciences, and why or why not? Another way of expressing this issue is to ask whether economic theories can state "laws". Philosophers of science and economists have explored these issues intensively since the work of Alexander Rosenberg and Daniel M. Hausman dating to 3 decades ago.For example:

• D. Wade Hands (2008). "philosophy and economics", The New Palgrave Dictionary of Economics, 2nd Edition. [http://www.dictionaryofeconomics.com/article?id=pde2008_P000084&q=philosophy%20economics&topicid=&result_number=1 Abstract].
• Roger E. Backhouse (2008). "methodology of economics", The New Palgrave Dictionary of Economics, 2nd Edition. [http://www.dictionaryofeconomics.com/article?id=pde2008_M000393&q=methodology&topicid=&result_number=1 Abstract].
• Alexander Rosenberg (1976). Microeconomic Laws: A Philosophical Analysis, University of Pittsburgh Press. [http://www.upress.pitt.edu/BookDetails.aspx?bookId=36114 Description] {{Webarchive|url=https://web.archive.org/web/20120112161811/http://www.upress.pitt.edu/BookDetails.aspx?bookId=36114 |date=2012-01-12 }} and [https://books.google.com/books?id=JFIYQyCY90QC&pg=PR7 Preview].
• _____ (1983). "If Economics Isn't Science, What Is It?" Philosophical Forum, 14, pp. 296–314.
• _____ (1986). "What Rosenberg's Philosophy of Economics Is Not", Philosophy of Science, 53(1), pp. 127–132. {{JSTOR|187927}}
• Douglas W. Hands (1984). "What Economics Is Not: An Economist's Response to Rosenberg", Philosophy of Science, 51(3), pp. 495–503. {{JSTOR|187496}}
• Bruce J. Caldwell ([1982] 1994). Beyond Positivism: Economic Methodology in the Twentieth Century, 2nd ed. Routledge. [https://books.google.com/books?id=hrqLZsCOg4sC&pg=PR5 Preview].
• Daniel M. Hausman (1980). "How to Do Philosophy of Economics", PSA: Proceedings of the Biennial Meeting of the Philosophy of Science Association, 1, pp. 353–362. {{JSTOR|192578}}
• _____ (1983). "The Limits of Economic Science", in The Limits of Lawfulness: Studies on the Scope and Nature of Scientific Knowledge, N. Rescher, ed. Reprinted in D.M. Hausman (1992 Essays on Philosophy and Economic Methodology, pp. [https://books.google.com/books?id=pM57-DJ2yDcC&pg=PA99 99–108].
• Daniel M. Hausman (1989). "Economic Methodology in a Nutshell", Journal of Economic Perspectives, 3(2), pp. [http://manoa.hawaii.edu/ctahr/aheed/Carl/supplementary%20readings/Hausman_1989_Economic_Methodology_in_a_Nutshell.pdf 115–127].
• _____ (1992). The Inexact and Separate Science of Economics. [http://www.cambridge.org/catalogue/catalogue.asp?isbn=9780521415019 Description], to ch. 1 [http://assets.cambridge.org/97805214/25230/excerpt/9780521425230_excerpt.pdf excerpt], [https://books.google.com/books?id=F7Vf3sb-ck4C preview], and reviews: {{JSTOR|2185742}}{{JSTOR|687635}}
• Kevin D. Hoover (1995). "Review Article: Why Does Methodology Matter for Economics?" Economic Journal, 105(430), pp. [http://econ.duke.edu/~kdh9/Source%20Materials/Research/WhyMethodologyMatters.pdf 715–734].
• Vernon L. Smith (2003). "Constructivist and Ecological Rationality in Economics", American Economic Review, 93(3), pp. [http://dev.wcfia.harvard.edu/sites/default/files/Smith2003.pdf 465–508]. {{webarchive|url=https://web.archive.org/web/20120111154803/http://dev.wcfia.harvard.edu/sites/default/files/Smith2003.pdf |date=2012-01-11 }}
• _____ (2008). "experimental economics", The New Palgrave Dictionary of Economics, 2nd Edition, [http://www.dictionaryofeconomics.com/article?id=pde2008_E000277&q=experimental%20&topicid=&result_number=2 Abstract].
• Francesco Guala (2005). The Methodology of Experimental Economics, Cambridge. Description/contents [http://www.cambridge.org/gb/knowledge/isbn/item1172961/?site_locale=en_GB links] and ch. 1 [http://www.cambridge.org/servlet/file/store6/item2350863/version1/item_9780521853408_excerpt.pdf excerpt]. {{webarchive|url=https://web.archive.org/web/20120917074454/http://www.cambridge.org/servlet/file/store6/item2350863/version1/item_9780521853408_excerpt.pdf |date=2012-09-17 }}

{{main|Decision theory|Game theory}}

Philosophical approaches in decision theory focus on foundational concepts in decision theory – for example, on the natures of choice or preference, rationality, risk and uncertainty, and economic agents.Paul Anand (1993, 1995). "Foundations of Rational Choice Under Risk". Oxford. Oxford University Press.

Game theory is shared between a number of disciplines, but especially mathematics, economics and philosophy. Game theory is still extensively discussed within the field of the philosophy of economics. Game theory is closely related to and builds on decision theory and is likewise very strongly interdisciplinary.Cristina Bicchieri (1993). Rationality and Coordination. Cambridge. [http://www.cambridge.org/gb/knowledge/isbn/item1154149/?site_locale=en_GB Description] and chapter-preview links, pp. [https://books.google.com/books?id=4SQ4AAAAIAAJ&q=%22Rationality+and+Coordination%22 v-vi]. Game-theory [https://books.google.com/books?id=4SQ4AAAAIAAJ&q=game links].

{{main|Distributive justice|Justice (economics)}}

The ethics of economic systems deals with the issues such as how it is right (just, fair) to keep or distribute economic goods. Economic systems as a product of collective activity allow examination of their ethical consequences for all of their participants. Ethics and economics relates ethical studies to welfare economics.For example:

• Amartya K. Sen (1970 [1984]). Collective Choice and Social Welfare. Elsevier.
• Daniel M. Hausman and Michael S. McPherson (1993). "Taking Ethics Seriously: Economics and Contemporary Moral Philosophy", Journal of Economic Literature, 31(2), pp. [http://www.colorado.edu/economics/morey/4999Ethics/ethicsandmoralphilosphy/HausmanMcPherson1993_Edward.pdf 671–731].
• _____ ([1994] 2005), 2nd Ed. Economic Analysis and Moral Philosophy. Cambridge University Press.
• Hal R. Varian (1975). "Distributive Justice, Welfare Economics, and the Theory of Fairness", Philosophy & Public Affairs 4(3), pp. 223–247. {{JSTOR|2265084}} It has been argued that a closer relation between welfare economics and modern ethical studies may enrich both areas, even including predictive and descriptive economics as to rationality of behaviour, given social interdependence.Amartya Sen (1987). On Ethics and Economics, Blackwell.

Ethics and justice overlap disciplines in different ways. Approaches are regarded as more philosophical when they study the fundamentals – for example, John Rawls' A Theory of Justice (1971)Amartya Sen (1990). "Justice: Means versus Freedoms," Philosophy & Public Affairs, 19(2), pp. [https://www.jstor.org/pss/2265406 111]-121. and Robert Nozick's Anarchy, State and Utopia (1974). 'Justice' in economics is a subcategory of welfare economicsIn the Journal of Economic Literature classification codes at JEL: D63, wedged on the same line between 'Equity' and 'Inequality'. with models frequently representing the ethical-social requirements of a given theory. "Practical" matters include such subjects as lawFor example:

• Richard Posner (1981). The Economics of Justice. [http://www.hup.harvard.edu/catalog/POSECO.html Description] and chapter links, pp. [https://books.google.com/books?id=CKEN0F07ChUC&q=%22economic+analysis+of+law%22+posner xi-xiii].
• David A. Hoffman and Michael P. O'Shea (2002). "Can Law and Economics Be Both Practical and Principled?" Alabama Law Review, 53(2), pp. [http://works.bepress.com/hoffman/4/ 335–420]. and cost–benefit analysisSven Ove Hansson (2010). "cost–benefit analysis: philosophical issues," The New Palgrave Dictionary of Economics, Online Edition. [http://www.dictionaryofeconomics.com/article?id=pde2010_C000618&edition=current&q=philosophical&topicid=&result_number=1 Abstract.]

Utilitarianism, one of the ethical methodologies, has its origins inextricably interwoven with the emergence of modern economic thought. Today utilitarianism has spread throughout applied ethics as one of a number of approaches. Non-utilitarian approaches in applied ethics are also now used when questioning the ethics of economic systems – e.g. rights-based (deontological) approaches.Marc Fleurbaey (2008). "ethics and economics," The New Palgrave Dictionary of Economics, 2nd Edition. [http://www.dictionaryofeconomics.com/article?id=pde2008_E000272&edition=current&q Abstract.]

Many political ideologies have been an immediate outgrowth of reflection on the ethics of economic systems. Marx, for example, is generally regarded primarily as a philosopher, his most notable work being on the philosophy of economics. However, Marx's economic critique of capitalism did not depend on ethics, justice, or any form of morality, instead focusing on the inherent contradictions of capitalism through the lens of a process which is today called dialectical materialism.

{{main|Heterodox economics|Critique of political economy}}

The philosophy of economics defines itself as including the questioning of foundations or assumptions of economics. The foundations and assumption of economics have been questioned from the perspective of noteworthy but typically under-represented groups. These areas are therefore to be included within the philosophy of economics.

• Praxeology: a deductive theory of human action based on premises presumed to be philosophically true (following the analytic–synthetic distinction of Immanuel Kant). Developed by Ludwig von Mises within the Austrian School, is a self-conscious opposition to the mathematical modeling and hypothesis-testing to validate neoclassical economics.[https://mises.org/about-mises/what-is-the-mises-Institute What Is the Mises Institute? Mission Statement].[https://mises.org/library/praxeology-methodology-austrian-economics Praxeology: The Methodology of Austrian Economics Praxeology: The Methodology of Austrian Economics]. Murray N. Rothbard (1976)
• Cross-cultural perspectives on economics, and economic anthropology: an example is the Buddhist-inspired Bhutanese "Gross National Happiness" concept (suggested as a better development measure than GNI/GDP). Amartya Sen is a renowned advocate for the integration of cross-cultural phenomena into economic thinking.Amartya Sen (2008). [http://www.pyinnya.com/wp-content/uploads/2008/04/culture-and-development.pdf "Culture and Development."] {{Webarchive|url=https://web.archive.org/web/20111005211313/http://www.pyinnya.com/wp-content/uploads/2008/04/culture-and-development.pdf |date=2011-10-05 }}
• Feminist perspectives on economics, or feminist economics.For example: Drucilla Barker & Edith Kuiper eds., {{cite book |year=2003 |title=Towards a feminist philosophy of economics |publisher=Routledge |isbn=0-415-28388-4 }}

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• Aristotle
• Kenneth Arrow
• Roger E. Backhouse
• Ken Binmore
• Kevin Carson
• Milton Friedman
• Frank Hahn
• Friedrich Hayek

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• Martin Hollis
• Daniel M. Hausman
• Terence Wilmot Hutchison
• David Hume
• John Neville Keynes
• John Maynard Keynes
• Tony Lawson
• John Locke
• Uskali Mäki

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• Thomas Robert Malthus
• Karl Marx
• John Stuart Mill
• Ludwig von Mises
• Pierre-Joseph Proudhon
• John E. Roemer
• Murray Rothbard
• John Rawls
• Lionel Robbins
• Joan Robinson

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• Alexander Rosenberg
• Paul Samuelson
• E. F. Schumacher
• Amartya Sen
• Brian Skyrms
• Adam Smith
• Max Weber
• Carl Menger
• Bernard Williams

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The ethics of economic systems is an area of overlap between business ethics and the philosophy of economics. People who write on the ethics of economic systems are more likely to call themselves political philosophers than business ethicists or economic philosophers. There is significant overlap between theoretical issues in economics and the philosophy of economics. As economics is generally accepted to have its origins in philosophy, the history of economics overlaps with the philosophy of economics.

Some universities offer joint degrees that combine philosophy, politics and economics. These degrees cover many of the problems that are discussed in Philosophy and Economics, but are more broadly construed. A small number of universities, notably the London School of Economics, University of Edinburgh,{{cite web |title=MA Philosophy and Economics |url=https://www.ed.ac.uk/studying/undergraduate/degrees/index.php?action=programme&code=VL51 |website=www.ed.ac.uk |access-date=9 July 2022}} the Erasmus University Rotterdam, Copenhagen Business School, the University of Vienna{{cite web |title=Master's in Philosophy and Economics About P&E |url=https://ssc-phil.univie.ac.at/studien/masters-in-philosophy-and-economics/about-pe/ |publisher=univie |access-date=14 August 2022}} the University of Bayreuth, the University of Hamburg and the Witten/Herdecke University offer master's degree programs specialized in philosophy, politics and economics.

• [http://journals.cambridge.org/action/displayJournal?jid=EAP&bVolume=y Economics and Philosophy]
• [http://ejpe.org Erasmus Journal for Philosophy and Economics]
• Journal of Economic Methodology
• [https://web.archive.org/web/20080821182922/http://www.blackwellpublishing.com/journals/papa Philosophy and Public Affairs]
• Politics, Philosophy & Economics – [https://archive.today/20130201192007/http://www.sagepub.com/journalsProdAims.nav?prodId=Journal201490 Aims and Scope]

• Analytic philosophy
• Critique of political economy
• Epistemology of finance
• Philosophy of science
• Schools of economic thought
• History of economic thought
• Teoría de Precios: Porqué está mal la Economía textbook (2010)

{{Reflist|35em}}

• Boulding, Kenneth E. (1969). "Economics as a Moral Science," American Economic Review, 59(1), pp. [https://www.jstor.org/pss/1811088 1]-12.
• Caldwell, Bruce (1987). "positivism," The New Palgrave: A Dictionary of Economics, v.3, pp. 921–23.
• Downie, R.S. (1987). "moral philosophy," The New Palgrave: A Dictionary of Economics, v. 3, pp. 551–56.
• Hands, D. Wade, ed. (1993). The Philosophy and Methodology of Economics, Edward Elgar. 3 v. Description and Table of Contents [http://www.e-elgar.co.uk/bookentry_main.lasso?id=535 links.]
• Davis, John B., Alain Marciano, Jochen Runde, eds. (2004). The Elgar Companion to Economics and Philosophy. Description & Table of Contents [http://www.e-elgar.co.uk/bookentry_mainUS.lasso?id=2696 links] and Introduction and ch. 1 [http://www.e-elgar.co.uk/g_emag.lasso?ebook13isbn=9781845423490&title= previews] via sidebar scrolling. Articles from 1925 & 1940–1991.
• Hausman, Daniel M. (1992). Essays on Philosophy and Economic Methodology. [http://www.cambridge.org/catalogue/catalogue.asp?isbn=0521417406 Description], ch. 1 [http://assets.cambridge.org/97805214/17402/excerpt/9780521417402_excerpt.pdf link.] Chapter-preview [https://books.google.com/books?id=pM57-DJ2yDcC&pg=PP9 links.]
• _____, ed. ([1984] 2008). The Philosophy of Economics: An Anthology, 3rd ed. Cambridge. Description & Table of contents [http://www.cambridge.org/catalogue/catalogue.asp?isbn=0521883504 links] and [http://www.cambridge.org/servlet/file/store6/item2477816/version1/item_9780521883504_excerpt.pdf Introduction]. From John Stuart Mill on.
• Heilbroner, Robert L. ([1953] 1999). The Worldly Philosophers: The Lives, Times, and Ideas of the Great Economic Thinkers, 7th ed. Scroll to chapter-preview [https://books.google.com/books?id=vIxtW9cw-DQC links.]
• Hodgson, Bernard (2001). Economics as Moral Science. [https://books.google.com/books?id=XspTpmayWMIC&q=gbs_summary_s Description] and chapter-preview links, pp. [https://books.google.com/books?id=XspTpmayWMIC&q=source=gbs_summary_s xi]-[https://books.google.com/books?id=XspTpmayWMIC&pg=PR14 xiv.]
• Peil, Jan, and Irene van Staveren, eds. (2009). Handbook of Economics and Ethics, Edward Elgar. [http://www.e-elgar.com/Bookentry_Main.lasso?id=4252 Description] and [https://books.google.com/books?id=YahcdBQ5nqQC&dq=false&pg=PR5 preview.]
• Putnam, Hilary (1993). "The Collapse of the Fact/Value Dichotomy," in Martha Nussbaum and Amartya Sen, ed. The Quality of Life, pp. 143–157. Oxford. Reprinted in Putnam (2002), Part I, pp. 5 [https://books.google.com/books?id=JvaUFgB1lKAC&pg=PA47=gbs_atb -64].
• _____ (2002). The Collapse of the Fact/Value Dichotomy and Other Essays, [http://www.hup.harvard.edu/catalog/PUTCOL.html Description] and chapter-preview [https://books.google.com/books?id=JvaUFgB1lKAC&pg=PR11=gbs_atb links.]
• Robinson, Joan (1962). Economic Philosophy. [http://www.transactionpub.com/title/Economic-Philosophy-978-0-202-30908-8.html Description] and scroll to chapter and [https://books.google.com/books?id=f1fzQAgRNO8C&q=Philosophy+economics previews.]
• Rubinstein, Ariel (2006). "Dilemmas of an Economic Theorist," Econometrica, 74(4), pp. [http://econ.ucsd.edu/~jandreon/Econ264/papers/Rubinstein%20Ea%202006.pdf 865–883] (close Page tab).
• Szenberg, Michael, ed. (1992). Eminent Economists: Their Life Philosophies, Cambridge. [http://www.cambridge.org/catalogue/catalogue.asp?isbn=0521449871 Description] and [https://books.google.com/books?id=FbYOKMQwbKsC preview.]
• Walsh, Vivian (1961). Scarcity and Evil]: An Original Exploration of Moral Issues on the Frontier Between Guilt and Tragedy. Prentice-Hall.
• _____ (1987). "philosophy and economics," The New Palgrave: A Dictionary of Economics, v. 3, pp. 861–869.
• _____ (1996). Rationality, Allocation, and Reproduction. Cambridge. [http://www.oup.com/us/catalog/general/subject/?cp=25211&ci=9780198287728 Description] and scroll to chapter-preview [https://books.google.com/books?id=bQYHEj_oIrYC links.]

• [http://www-personal.umd.umich.edu/~delittle/Encyclopedia%20entries/philosophy%20of%20economics.pdf Philosophy of Economics] (Daniel Little's entry in the Routledge Encyclopedia of the Philosophy of Science)
• [http://plato.stanford.edu/entries/economics Philosophy of Economics] (Stanford Encyclopedia of Philosophy) by Daniel M. Hausman, notable in the field.

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