Abstract
In this paper, we argue that the ethics of care can offer solutions to diverse tragedies of the commons. Building on Hayek’s (Law, legislation and liberty, Abingdon, Routledge, 1982) theory on the emergence of rules and norms, we outline the spheres of application of the ethics of care and the ethics of justice and outline how the two interact. We apply our analysis of the interaction of the ethics of care and the ethics of justice to the problem of the tragedy of the commons. The morality of care allows people to establish rules in small groups and to ensure the compliance with theoretically defined rules in the Great Society, thus potentially avoiding any tragedy of the commons in either realm. We illustrate our argument with two examples of the tragedy of the commons: fractional-reserve banking and environmental tragedies.
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Notes
On the evolutionary origin of law, see also Leoni (1991). An excellent presentation of the evolutionary origin of rules is also provided by van den Hauwe (1998).
When we refer to the Great Society and small groups, we do not mean to refer to an exact amount of people. We use these terms as imaginary constructions to simplify the analysis. We can differentiate a small group from the Great Society based on the fact that the set of rules governing the small group can be rationally designed, whereas in the Great Society, the amount of dispersed factual knowledge makes it impossible to rationally design the governing set of rules.
For the sake of exposition, we assume here that the small group is not embedded in the Great Society. It is true, as we mention below, that most small groups are currently embedded in the Great Society, but it is also true that some groups continue to live on the fringes of it, in the same way that many groups throughout history have not coexisted with the Great Society.
The ethics of care is rooted in the feminist epistemological critiques of Cartesian rationalism. Feminist philosophers such as Bordo (1986) have argued that Cartesianism entailed the masculinization of science. According to Bordo, the rejection of subjectivity, emotions, and dependence—central concepts in the ethics of care—is a result of Cartesian rationalism. From another perspective, Hayek (1948, 1982) criticizes Cartesian rationalism for its erroneous assumption of the power of the human mind and introspection; he emphasizes limited human cognitive capacity, in contrast.
More specifically, they are results of human action but not of human design, as Hayek (1982) remarks by citing Adam Ferguson’s famous words.
For all those interested in the debate, see Selgin (1988), White (1989), and Selgin and White (1996) for the opinion that fractional-reserve banking does not cause economic cycles. See also Hoppe (1994), Hoppe et al. (1998), Huerta de Soto (1995, 1998), and Bagus et al. (2013), who resume the criticism of fractional-reserve banking initiated by Mises (2009) and Hayek (2008).
A Latin word that means the same quantity of goods of the same quality and type (Huerta de Soto 2006).
From the perspective of current positive law, the bank is the owner of the deposits, but there is much confusion. In a survey (Evans 2010), only 8 percent of depositors were aware of the legislation; 74 percent thought they were the legal owners of “their” deposits.
Still, as Bagus (2010) proves, it is not sufficient to have a 100 percent–reserve requirement; it is also necessary that governments and central banks not bail banks out when they have roll-over problems or fail.
We have to admit that banks not holding full reserves have a competitive advantage. In any case, the prevalence of an ethics of care would increase the psychic costs involved in credit expansion.
Ostrom (1990, 30) defines a CPR as “a natural or man-made resource system that is sufficiently large as to make it costly (but not impossible) to exclude potential beneficiaries from obtaining benefits from its use.”
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Moreno-Casas, V., Bagus, P. The ethics of care and the tragedy of the commons. Int Rev Econ 68, 405–422 (2021). https://doi.org/10.1007/s12232-021-00376-y
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DOI: https://doi.org/10.1007/s12232-021-00376-y
Keywords
- Ethics of care
- Tragedy of the commons
- Limitations of knowledge
- Fractional-reserve banking
- Environmental management