Values in Economic Decisions and Policymaking

Abstract

The authors argue that values influence decisions taken by policymakers and that decision and policymakers can follow one or the other of the two distinct paths — altruism and egoism. However, the main purpose of this article is to investigate outcomes of government and corporation policies formulated in accordance with theories espoused in economic rationalism or neoclassical economics. These show that they generally follow the path of egoism. The occasional result is that although multinational enterprises and other corporations contribute to the relief of natural and economic problems, they may in fact be contributing simply out of corporate self-interest. The recent collapse of financial markets in the United States and throughout the globe is identified as a result of business activities designed to seek higher corporate profits and higher executive payouts, which are motivated by self-serving values linked to the ideologies of neoclassical economics or economic rationalism. The article argues for a just and fair redistribution of incomes, possibly best achieved through the taxation system and opens the way for further research on the alternative path—the path of altruism.

Keywords:

• bankruptcy
• economic rationalism
• egalitarianism
• financial crises
• policymaking
• taxation