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Ethics and The Economics of Globalization Tanner 2004
Ethics and The Economics of Globalization Tanner 2004
OF GLOBALIZATION
Joseph E. Stiglitz
2004 Tanner Lectures
Oxford
OUTLINE
• IS THERE AN ETHICAL DIMENSION TO
ECONOMIC BEHAVIOR?
• THE RIGHTS PERSPECTIVE
• ETHICAL DIMENSIONS OF GLOBALIZATION:
PRINCIPLES
• ETHICAL DIMENSIONS OF GLOBALIZATION:
TRADE
• ETHICAL DIMENSIONS OF GLOBALIZATON:
FINANCE
• ETHICAL DIMENSIONS OF GLOBALIZATION:
ADVICE
• CONCLUDING REMARKS
IS THERE AN ETHICAL
DIMENSION TO ECONOMIC
BEHAVIOR?
ADAM SMITH’S INVISIBLE HAND:
INDIVIDUAL’S, IN PURSUING SELF-
INTEREST, PROMOTE GENERAL
INTEREST
– Arrow and Debreu showed sense in which
(“Pareto efficiency”) and conditions under
which Adam Smith was correct—Fundamental
Theorem of Welfare Economics
ADAM SMITH’S INVISIBLE HAND
• IMPLICATION: INDIVIDUAL’S ONLY
NEED TO THINK ABOUT SELF-
INTEREST
• BUT ONLY LEADS TO EFFICIENCY:
ETHICAL ISSUES REMAIN ABOUT
DISTRIBUTION OF INCOME
MARKET FAILURE AND THE
FAILURE OF ADAM SMITH’S
INVISIBLE HAND
• WHEN THERE ARE “MARKET
FAILURES” THE PURSUIT OF SELF-
INTEREST WILL NOT LEAD TO
ECONOMIC EFFICIENCY
By