Introduced to the packed audience of professors and students in Call auditorium as “one of the most prominent intellectuals of our time,” Nobel Laureate Amartya Sen delivered a lecture this afternoon titled “Capitalism and Confusion.” The lecture was full of jokes, self-deprecating humor, and entertaining stories about his colleagues, but his talk was very theoretical in the ways in which it addressed the question of what it means for an economy to be capitalist. He made many interesting points about Adam Smith’s initial conceptions of capitalism, saying that even Smith believed that governments should intervene to ensure the enforcement of property rights and to protect the safety and security of their citizens.
His main argument can be summarized as follows: In this time of economic crisis, we should not fall into a dichotomous mode of thinking, deciding whether or not capitalism or socialism is the optimal route for economic organization. Instead, we need an approach that analyzes individual market and bureaucratic institutions and decides which ones would be best for our current situation. He also said that in the past, reason has been a great source of human strength, and that our current problems can be solved by making our choices adhere to practical, pragmatic reasoning, and not by simply adhering to our personal investments in socialist or capitalist economic systems.
Please feel free to comment if you attended the talk or are familiar with Sen’s work, and look out for a full article and analysis in the next issue of the Review.
I thought the lecture was excellent–he was hilarious and very intelligent. I disagreed with him on some things like health care and pollution, but more about his assumptions than his recommendations given his assumptions. e.g. if the social cost of pollution is high, then we SHOULD tax polluters. And he was right that it requires collaboration between modern countries, with penalties for those who don’t comply. All this was spot on given that pollution has high social costs . I would argue that pollution is not (in general) as big a social cost as people say. Given that assumption, you get a different answer.
This is on a complete tangent, but I read “The Use of Knowledge in Society” recently by Hayek, which was an excellent paper, and it somewhat relates to this. One of his points is that we know how to find the efficient outcomes given all circumstances . But we don’t know all the circumstance at any given time, and can’t; therefore the problem of economics is learning these circumstances, or finding a way to efficiently allocate resources without anyone explicitly knowing all of them. He goes on to argue in favor of the price system and against central market planning, which is unrelated to Sen’s lecture.
Overall excellent lecture. Thought-provoking and insightful. I liked that he argued for eschewing dogma and “names.” Really hope everyone else was as lucky as I was to attend!
What did you think Dennis?
Like I said earlier, I thought it was good, but I’m skeptical about the usefulness of this “abandon ideology and take the pragmatic route” approach. I did like his points, though, about examining individual institutions and not just thinking in terms of whether or not “socialism” or “capitalism” would be best for us at the moment.
I suspect that all of the people who have died from cancer due to the environmental toxins released by polluters would disagree with you on the notion that the social costs to pollution aren’t very high.
OK Mr. Nagowski, you caught me. “I would argue that pollution is not (in general) as big a social cost as people say.” Oh, radical me! You must realize you’re precisely an example of what I’m talking about. I for one appreciate your keen sense of wit and satire.
The point of the post was not to debate the seriousness of pollution. Next time, rather than having the knee jerk reaction “He said pollution not big deal, so he bad!”, try to consider what the person is actually saying. I heard Sen argue in favor of things I disagree with, but I still came away impressed with him. It wasn’t “He said universal health care good. He bad!”. So grow up.