Beyond Sustainable Economy ► 09 ►Economy ► Welfare Economics and Aparigraha

Posted: 16.08.2017

Ethics teach man 'HOW' he should be rather than 'WHAT' he should be. The how and what make a great difference in human life and in society. Every school of thought has 'ethics' essentially as one of its important ingredients. There is ethics in economics, sociology, and psychology. Ethics is a code of conduct. Nowadays 'welfare' in economics is an ethical aspect.

In the light of a philosophical approach to economics, it is necessary to find out the right meaning of welfare in economics.

A dictionary says: Welfare in economics is the health, happiness and fortune of a person or group, organized efforts designated to promote the basic wellbeing of people in need. One has to analyze this in a subjective as well as in an objective manner. The welfare of man is the most important task for economists. "The economist, like everyone else, must concern himself with the ultimate aims of man," said Alfred Marshall[1] in his Principles of Economics (1890). They are supposed to make a choice between alternative policies and good and bad institutions to decide the theory of how and by what criteria welfare economics should work. Welfare economics thinks on the line of maximizing human happiness without making others suffer. Earlier it was thought that individual and society would have maximum benefit in the market regulated economy.

Jeremy Bentham[2] is considered a radical philosopher. His philosophy is divided into two categories: (1) The Association Principle and (2) the Greatest Happiness principle. We can define these as 'virtues.' He advocated complete democracy, including votes for women. He held that the greater number would judge right. Ethics is necessary because men's desire and conflict is a cause of egoism. According to Bentham, 'free competition,' in orthodox economics, is a very artificial conception, hedged in by legal restrictions.

Pareto[3] was an Italian economist. First he thought for the welfare of man. He took welfare in individual terms. He thought in terms of 'optimal' which was a goal. The Pareto formula is as follows:

If everyone in the society is indifferent concerning two alternative social situations X and Y, society should be indifferent as well;

If at least one individual strictly prefers X to Y, and every other individual regards X to be at least as good as Y, then the society should prefer X to Y.

The Pareto optimality is: "In a given choice situation, consider the set of alternatives to X from which a choice should be made. An alternative X belonging to that set will be described as the Pareto Optimal if there is no other alternative in the set which is, Pareto-wise, better than X."

Marshal agreed as far as morality is concerned. Prostitution, for example, is not a productive activity according to Marshal, but an immoral activity. Richard Hare[4], John Rawls, John Harsanyi[5] and Kenneth Arrow[6] were distinguished economists who thought in terms of welfare.[7] The contractual tradition treats morality as the outcome of an (actual, imagined or hypothetical) agreement. Rawls' variation of the approach leads to principles of justice, which give a particularly high priority to the least well-off group in society. Kenneth Arrow was the most accepted economist in this area. His 'impossible theorem' was a landmark in welfare economics.

A sophisticated account of this view has recently been developed by John Rawls[8] in his A Theory of Justice, which argues among other things, for the difference principle, a maxim like principle of social justice which tells us to maximize the prospect of the worst-off class in society as opposed to the sum of individual utilities.

The question of moralty and justice came into picture. Dr. Amartya Sen said very properly that the 'Ought to be' of Socrates was very important. Aristotle considered problems of ethics in connection with the social life of the people. Aristotle regarded ethics as the doctrine about the morality of man as a social creature, as a political animal. Dr. Amartya Sen said in his book rationality and freedom that "everyone's utility goes up". Dr. Amartya Sen put forward the thought of a collective choice theory, development as freedom, inequality, and poverty and hunger eradication by way of development of capability as the concepts of welfare economics. Dr. Amartya Sen talks about Human values, Human rights, Human dignity and Human happiness. These thoughts have been further developed as Human Wellbeing.

Morality made out a part of religion as expounded by the Jain thinkers and ethic to club the idea of metaphysical and theological consideration. This is a link between human and cosmos. As per the morality, it directs a person to act in the ought to be sense. This is a very effective tool for our spiritual development.

 

Charvaka and materialism

The Indian materialsist 'philosophical school' of Charvaka (Cārvāka) was probably established before the sixth xentury BCE. The school taught systematic atheistic materialism. the doctrine of pleasure was put very well into practice in daily life. One should enjoy life fully. The school suggested its followers to incur debt and drink GHEE, that means, to live life happily. Happiness is supreme. One should not worry about the next day. Nobody is beyond the range of death. There is nothing after death. Death itself is liberation. One did not believe in the rebirth theory. There exists nothing like a soul. Consciousness is the result of fragmentation of four eternal elements. The body is the only visible thing and it is the cause of existence due to four eternal elements. Whatever is beyond the experience of the senses is false and is non-existent. Whatever is perceived is real. This happiness is momentary (1)

This cannot be the goal of life. One cannot expect to eliminate pain from one's life permanently by this theory. The utilitarian believes in increase of pleasure. They do take conduct into account. Conduct is part of life. They say that an objective feeling of sensuous pleasure is not a standard of morality. Jonathan Glover[9], an Oxford philosopher, argues in his recent and very interesting Moral History of the Twentieth Century that we must not only reflect on what has happened in the last century, but we also need to look hard and clearly at some monsters inside us and to consider ways and means of caging and taming them." (2)

In the early historical period an immoral act done by way of religion was acceptable in society. Very recently, the act separated as either religion or morality. This act of morality is conducive to man's immediate ultimate welfare.

We have accepted inequality. Social welfare economics is not in favor of this. The concept of human welfare is pushed into a corner. It seems that economics has nothing to do with social service and social work. Welfare being satisfaction and happiness, these terms are required today.

 

Aparigraha – Non-possessiveness

Parigraha or attachment is the philosophy of the western world. Industrialization, consumerism and urbanization are the fruits of it. Now these things are the golden route to accumulate wealth, which is the mother of parigraha. The definition of possessiveness is taking interest in worldly things and body care only. The opposite of this is non-possessiveness. Mohaniya or the deluding factor in karma is responsible for giving wrong information and to act in a possessive way.

A person can have that much possession which fulfils his basic needs as an individual. Possession of material things will bring unlimited anxiety, surrender to immoral activities, to doing injustice and taking shelter under falsehood. The loss of material things will result in pain, absence of peace and bad thoughts. Lord Mahavira had shown the way of the welfare economy. Lord Mahavira suggested limits in each and everything. Limitation of Money gives you Peace and Happiness. Here a human remains in the centre and money but an external factor.

Lord Mahavira thought of a Vow Society. Lord Mahavira gave many rules for ascetics and house-holders. These rules were given from a philosophical point of view for the welfare of the human being in his ultimate benefit. One has to combine materialistic thoughts with spirituality. One does not require wealth to do certain things (3).

  1. Accumulation of wealth is not necessary for the fulfillment of some human choices. In fact the individual and the society make many choices that require no wealth at all.
  2. A society does not have to be rich to afford itself democracy.
  3. A family does not have to be wealthy to respect the right of each member.
  4. A nation does not have to be affluent to treat women and men equally.
  5. Valuable social and cultural traditions can be and are maintained at all levels of income. The richness of a culture can be largely independent of the people's wealth.
  6. People may desire wealth, but at the same time have their quest for knowledge and a long and healthy life, free participation on in the community, a clean environment and peace of mind that flows forth from job, home and society.
  7. Wealth maximization and human development have a definite co-relation. This will result into a break down for too many societies.
  8. Many countries have a high GNP (Gross national Product) per capita but low human development indicators and vice versa.
  9. Countries at a similar level of GNP per capita may have vastly different human development indicators depending on the use they have made of their national income.

According to the Uttarādhyayana Sūtra, the root of all mental and physical suffering is the desire for worldly enjoyments.

Economists say you must increase your desire. This will lead to development and progress. Lord Mahavira stated the opposite of this.

 

 

Less Desire

The capital shall not be concentrated on one place. Gandhi was in favour of decentralization. If decentralization will come into existence than the human will act with the trusteeship idea.

Waste is not acceptable in the name of economic growth. Waste is the result of consumption. Here a person's self-interest is of primal importance and social welfare becomes a secondary thing. One can say that economic progress goes at the cost of the social welfare progress.

As human life is precious, animal and plant life are also valuable. It should be preserved and protected at all times. All outrageous use is to be prohibited, such as the limitless exploitation of the natural foundation of life, ruthless destruction of the biosphere, and militarization of space. We are responsible to future generations for our misuse of the earth, the surrounding space, water, air, and nature in general. The population is dependent on preservation of all these things. We must create harmony with nature.

Religion thinks in terms of internal development and economics thinks in terms of external development. Therefore one has to set a conscious limit to desire and requirement. It will be somewhat like this: 1) Necessarily you get little happiness. You become sad. 2) By comfort you get a little more happiness. Your sadness will become less. 3) By luxury you get much more happiness. You will no longer be sad.

Man lives in a social condition, therefore he cannot totally leave the things which he needs to function  in that condition, but definitely he can apply the limit in his needs and demands. Economics is expressed in the sense of consumption. Consumption may be useful or may not be useful. Economics should think in philosophical terms for human welfare. Non-possessiveness is a useful tool at every aspect in life.

 

Capability

The dictionary meaning of capability is (1) being capable, (2) a feature or faculty capable of development; potential.

Early economic sustainability has discussed equality in income, wealth and happiness or desire. Now it is difficult to judge equality and efficiency in terms of capability. This is different from the earlier approach of the utility and welfare formula. Utility only takes into account the individual and his pleasure, happiness and desires. This is individual wellbeing. Therefore capability is a new approach in better philosophical terms.

Capability is a new approach compared to an old one and it has its own importance in the wellbeing of man. Dr. Amartya Sen has derived the philosophical meaning of it in economics. Capability means (1) wellbeing and (2) freedom to pursue wellbeing. Wellbeing is the quality of a person's being. Functioning is the achievement of wellbeing. As per Scandinavian studies wellbeing means to be adequately nourished, being in good health, avoiding escapable morbidity and premature mortality. In Greek history, Aristotle included penetrating investigation of a good man in terms of life in the sense of activities.  

A function can be complex, such as for example self-respect; a person should be able to take part in community life and so on and so forth. Therefore capability is the sum total of functions which a person can achieve. Here the person has the freedom to choose the possible form in which he wishes to live. The wellbeing of freedom is connected with ethical and political analysis.

Rawl is in favor of 'the right' and 'the good'. Some economists are in favor of 'the right' in comparison to maximizing 'the good.' The achieved wellbeing is past and it is based on the capability to function. The opportunity of wellbeing should be seen as a right to do one thing in the morning and a second thing in the evening.  Here right and idea have to be balanced properly.

One can say that capability is freedom. Here the level of wellbeing comes in the picture. The measure of freedom of choice decides the level of wellbeing. Its functioning is a link in the chain of capability. Here the instrument to make it function is important. The instrument of freedom gives more option to choose in the future. You may be fasting by choice. The fasting is not due to lack of previsions but to the fact that person has the freedom to choose this option.

The utility of a person can guide us about the wellbeing. Welfare economics reflects into individual utility. Utility can be a mental condition such as pleasure, happiness, and desire.  There is no metric available in economics which can measure a mental condition. "Happiness" can be high or low as per the individuals mental condition. Therefore desire fulfillment should be taken as the functioning of capability. A person chooses not to grieve and very often makes a great effort to take pleasure in small mercies. This will not reflect in the metrics of desire, but it is a deprivation.

Capability deprivation can be in the  field of poverty. Poverty hinders the minimum fulfillment of one of its basic capabilities. Poverty in less developed countries is one thing. You will be surprised to know that it exists in rich and developed countries as well. These countries know poverty in many forms. (1) hunger (2) life span (3) the problem of health care (4) inadequate medical attention (5) the prevalence of urban crime. When the average  mortality of Americans in the age group between 35 to 55 is stated as 1, whereas the African Americans show a mortality rate 2.3 times as large. Here low income can be one of the reasons. The social environment is deeply influenced by violent modes of city life, absence of social care and other factors. Capability in poverty can change things if the person wishes. Aristotle agreed with Agathon that even God could not change the past, but he also thought that the future was ours to make.

In the capability approach, humanity is at the centre. Capability focuses on ability. Ability means to enhance the real choice one has and the reason to value that which leads to the life with freedom. Adam Smith advocated better education resulting in increase in the reading habits, communication skills, argumentation, etc. Education will help to increase production and better living and thus results into wellbeing. Economic prosperity will give broader options to live a more fulfilling life.

The capability approach plays a great role in the life of women. Education will help to get food for the family, to make right family planning, to take care of elderly people and to instill good habits in children. The capability approach for woman will open a new horizon for earning, for respect within the family and equal share in property and wealth. Educated people will have a better understanding about the cause of missing women, woman trafficking, morbidity and mortality. Women agencies will help them to fulfill their goals. Freedom for women will be accomplished. Women can fight for their deprivation, poverty and health problems.

 

 

Jainism

Lord Mahavira already defined capability in the sense that one should get bare minimum without discrimination of what one requires. Lord Mahavira always emphasized on the value of one's own labor or puruśārtha.

Aparigraha or Non-Possession

Generally religion is understood as merely a ritualistic thing. People do rituals as a part of their religion. Ritual is a convention. The tradition is in the family and in the society. In an ideal mental state, duty takes the form of habit and ethics changes into psychology. The body and mind are covered in these aspects. Habit and psychology are the clue to human behavior. Ethics is an important aspect of religion. In ethics there is no difference in a man's duty for himself and for society.

Parigraha is the cause of all problems. It takes away peace, makes men into devils and encourages doing all sorts of wrong things. It is the root cause in terms of finance and creates all types of imbalances within society. The institution of a special economic zone idea has created lots of trouble in many countries and especially in India. The definition of possessiveness is taking interest in worldly things and body care. A person will establish his right of "mineness" everywhere. He has a desire of ownership. This possession factor is the strongest one on human psychology next to the effect of any astrological planet. 

The mohanīya, that is, deluding karma is responsible for giving wrong information and for acting in possessive ways. Someone can have just that much of possessions as fulfill his basic needs as an individual, as stated so many times This very fact leads someone to think in terms of possessions.  Possession of material things will lead to unlimited anxiety, surrender to immoral activities, to injustice and falsehood. The loss of material things will result in pain, no peace and bad thoughts.

Possession increases someone's passions and wishes. Possession means that people deny and deprive others of the right to possess what he or she needs. The best advice is that one should leave his sense of 'mineness'. Possession instigates a person to steal, kill to untruthful conversation, it makes him cruel and do all kinds of bad  and immoral things. Aristotle said at one place that money should only be acquired in order to provide the means for exercise of one's capacities and should not be wasted for non-monetary and non-acquisitive aims. There are eighteen types of sins described in Jain philosophy. Possession is number five in the list.

Lord Mahavira was a realist. He realized the difference between a materialistic life and a spiritual life.  A materialistic life will give temporary happiness and spiritual life will give eternal happiness. Materialistic life will ultimately result in unhappiness. This will be a cause of pain and suffering.

A person should control his desires. The result of desire control will be that: 

  1. There is no poverty, but at the same time no luxurious life.
  2. Money is the instrument for one's needs. Money is for man and man not for money.
  3. One will fulfill his need with the view not to harm others.
  4. One should decide to a limit to one's income.
  5. One should think that money is useful. One should be indifferent to excess money.
  6. One should accept that the virtue of money is to give satisfaction.
  7. One should develop the capability to use money for good purposes.

Lord Mahavira defined 'greed' in the Uttarādhyayana Sūtra as follows: "Where there is an inner desire for material gain and possession of worldly objects of enjoyment, there is greed." Therefore Lord Mahavira advised to apply discrimination of one's wants. Lord Mahavira told that what is harmful to body, mind and feeling should be avoided. He told to control imagined need. He gave a golden equation. Limitation of money = peace and happiness.   When one follows simplicity faithfully, material abundance will lose both its spirit and attraction.

It is a law of nature that things constantly change. The new becomes old and old becomes new. Consumption is a need. Corruption on all levels is the result of consumerism. The stronghold of religion erodes. Religion is known best for simplicity, contentment and self-control  but religion itself has become a prey to the philosophy of consumerism.

Our ethics is to preserve the environment. The ecological balance is a prime thing of today's world. Two types of people are cruel to our environmental assets (1) Well to do people for their greed. (2) Penniless people due to their needs. This cruelty has become a burning issue. 'Icchaparimana' – limited desire – is the only human solution for non-possessiveness. The voluntary control of desires is the only remedy, it is voluntary socialism.

The best thing about Aparigraha or non-possessiveness is that it is realistic, practical and rational. Aparigraha or non-possessiveness has a solid foundation in our social system. Lord Mahavira was a great social philosopher.

 

Conclusion

In economics, capability brings all round progress to man. It takes into account the future aspects of humanity. The wellbeing of the human species is the result of capability development. In case of non-possessiveness, one talks about equity in society. It takes into account the need of all people and discourages the over protection of human for his wishes. This will have good effects in society.

 

 

References

  1. Haribhadra translated by K.Satchidananda Murty "Sad-darsana samuccya, Chapter 7, p..101-108.
  2. Dr.Amartya Sen, Book: - Argumentative Indian, p. 273.
  3. Acarya Mahapragya: Mahavir ka Arthsastra, p. 196-197
  4. Edited by Dhiraj Muni, Uttradhyayana Sutra, Chapter 6, stanza no.6, p. 35
  5. Acarya Mahapragnya: Mahavir ka Arthsastra, p. 35,

 

Bibliography

Collective Choice and Social Welfare, Holden-Day Inc., 1970.

Dhiraj Muni (Ed.) Uttradhyayana Sutra (in Gujarati). Mumbai: Vitrag Prakashan, 2003.

Glover, Jonathan: Moral History of the Twentieth Century. London: Yale University Press, (1999) 2001.

Haribhadra:. Sad-darsana Samuccaya, translated by K.Satchidananda Murty. Mumbai: Jain Sahitya Vikas Mandal, 1st edition 1976.

Littel, I.M.D.: A critique of welfare economics, New Delhi: Oxford University Press, 1956 (2nd edition).

Mahapragya, Acarya: Mahavir ka Arthsastra, Adarsh Sahitya Sangh Prakashana 1994

Marshall Alfred: Principles of Economics London: Macmillan (1890, and revised ed, 1920).

Piti, Joseph C.: Philosophy in Economics, Essay by Steven Straatwick. Dordrecht (Netherlands): D. Reidel Publishing Co.

Rawls, John Bordley: A Theory of Justice. Cambridge (USA): Belknap (Harvard University Press), 1971.

Sen, Amartya: The Argumentative Indian. London: Penguin Books, 2005.

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Title: Beyond Sustainable Economy
Authors: Dr. Rudi Jansma, Dr.Sushma Singhvi
Publisher: Prakrit Bharati Academy
Edition: 2016