Most of us are moral most of the time

Ross Gittins realises that Most of us are moral most of the time. His ... shocking conclusion is that:

... Sometimes monetary reward is a poor substitute for duty, honour or professionalism in encouraging people to do the right thing.

A new book, Moral Markets, edited by the neuroeconomist Paul Zak, and published by Princeton University Press, argues that most people behave ethically most of the time.

"Just as most human beings have an intact and active moral compass, so, too, does economic exchange, the child of human minds, have a vigorous moral dimension," Zak writes.

Most economic exchange, whether with people you know or with strangers, relies on character values such as honesty, trust, reliability and fairness. And a set of shared values is essential to the functioning of modern economies.

That's the first sense in which markets are moral, Zak argues. The other sense is that market exchange itself can lead to an understanding of what constitutes fair exchange, and in this way build social capital in the community. Research has shown that the values that create social capital are a potent stimulus for economic development.

"Exchange is inherently other-regarding," Zak says. "Both you and I must benefit if exchange is to occur. In this sense exchange in markets is virtuous: one must consider not only one's own needs but also the needs of another."

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Here we a confusion between Use Value and Exchange Value. A fair exchange between us means that we consider the goods or services to be of equal value. Neither of us can fairly profit by an exchange. We may find that our new goods have a higher Use Value, but this is not the same as the Exchange Value.

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"These moral emotions have been localised to evolutionarily old areas of the human brain," Zak says. Many moral decisions, including market decisions, have both cognitive and emotional components.

This is not an attempt to sanctify capitalism. It's an attempt to understand how markets actually work and put back into the story important elements left out of the economists' conventional model, with its focus on supply and demand and price, and its lack of emphasis on "institutions" (which include the moral values of the participants).

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Here we have the mistaken belief that markets only exist in Capitalism. Markets exist wherever exchanges of goods and/or services take place. Markets preceded the rise of Capitalism and will certainly be around after its fall.

The article fails to consider the current amorality of the markets could be due to the great concentration of economic power in a relatively few individuals. And that these individuals are immune to any corrective action taken by other more moral people.