Utility and Utilitarianism

Economics Economics Questions
,
1

There is an argument against utilitarianism that seems to be common amongst austrians, which i believe is incorrect. Here’s the argument, as it is put forward by Edward Stringham:

“Many justifications for government use utilitarian arguments, which assume that subjective tility is cardinal and commensurable between different people. But the most thorough economic ubjectivists reject these premises. How can we maximize the sum of utils in society when we have o way of adding up or even measuring imaginary utils?16 In addition to rejecting utilitarianism, the ost thorough subjectivists reject other attempts to create proxies for societal well being such as onetary income, migration patterns, or cost benefit analysis. Each of these policies measures something, but none measure psychic utility.”

The error he, and others, makes is that he defines utilitarianism as trying to maximize “utils”. This would maybe apply to “preference utilitarianism”, but it doesn’t hold for hedonistic utilitarianism, that seeks to maximize pleasure or happiness. The feelings of pain and pleasure are something entirely different from the economic concept of utilily. They are not the same thing: I can do something which I know will not give me most pleasure, even though I prefer to do it (it gives me the most utility of my options available). Why this argument is still used against utilitarianism I do not know, is it because preference utilitarianism is the prevailing form of utilitarianism in the U.S. and it is implicit in the argument that it only applies to them?

I would like to add that measuring pleasure and comparing it between individuals is possible. It is not exact science, but imagine giving candy to a small child or giving away Mises’ Human Action. which would make her feel happier?

2

Technically, “util” only refers to a unit of whatever an individual is attempting to maximize - that could be happiness, pleasure, monetary income, anything else, or any combination of things.

To avoid the problems of attempting to quantify and compare such things among individuals, mainstream economists often make the further assumption that individuals act in order to maximize monetary income (economic man) - and thus their models often do not correspond to reality. (To which they respond that reality is flawed and requires government intervention to make it fit their models!)

I think the Austrian position still holds, even if you take the “util” in the most generic sense. Yes, I’m sure most children would likely be happier with candy rather than a copy of Human Action. Even this isn’t necessarily true - you can only demonstrate this for any given child at any given point in time by giving them the choice. But that’s only half the problem.

The actual problem “mathematical utilitarians” propose to solve is to predict the total happiness/utility/whatever of society if I give the candy to the small child (or more accurately, if it is taken from me by force), versus if I eat it myself. This is comparing “quantities” of happiness between different individuals. This is obviously much more problematic, than the scenario you describe.

3

Really? I thought it only denominated that unit which doesn’t exist, that unit which in theory should measure how much I want something. I don’t think it should be used for happiness or monetary income since we already have units for those things: “happiness unit” and “dollars”.

I can only demonstrate their preference for candy, at any point in time (even though I would uphold it as some sort of empirical law of candy/Action/chilldren that says most of them prefer it to HA every day of the week), yes. But I wasn’t talking about demonstrating their preferences with that example, but of trying to measure their sense of happiness.

Sure, it is highly problematic, but it is a puzzle that we theoretically can solve, unlike that of trying to compare “utils”. And the question, if the number of happiness units will be more or less if I steal a dollar from you to buy some candy, will depend on how much it hurts you to be stolen and what I gain from the candy. Suppose I buy candy I do not like, then we probably have less happiness in the world. Comparing happiness between two individuals is of course very tricky, but is not impossible. Suppose that Hell and Heaven did exist - would you say it is impossible for us to say that most citizens of the former is less happier than those in the latter?

4

A “util” is a unit of wellbeing. If you are a “hedonistic” utilitarian, then you believe that a person achieves higher levels of total utility when she experiences greater pleasure. If you’re a “preference” utilitarian, then you believe that higher levels of utility correspond to more preferable outcomes. But utilitarianism is not a positive theory “about” utils, it’s a normative theory that suggests that the maximization of social utility (that is, the collective wellbeing of society) ought to be the goal of social decisionmaking (including the decision not to interfere with spontaneous ordering mechanisms like the free market).

The problem that most people have with utilitarianism is that it often completely ignores the idea of rights. This position has its most well-known roots in Nozick’s Anarchy, State, and Utopia, which you should read some time if you haven’t already. This particular issue is discussed in chapter 3, specifically in the sections entitled “Moral Constraints and Moral Goals,” “Why Side Constraints?,” and “Libertarian Constraints” (this amounts to about 8 pages). While many teleological ([something] maximizing) theories have been constructed in a way that somewhat addresses this objection, the idea that rights are not “values” or “goals,” but are more like “boundaries” or “constraints” is something that teleological theories are inherently inimical to.

The “Austrian” objection you discussed earlier is not unique to the Austrian school. Pretty much all modern economists recognize the difficulties in comparing utilities between individuals, and while Austrians like Menger and Mises played no small role in bringing this about, the idea can not fairly be claimed as a contribution by the Austrian school alone. And certainly it is not fruitful to make a big deal of this point today; everyone knows that we can’t compare interpersonal utility without putting ourselves at risk of being called to task for doing so.

It’s interesting that you object to this; it’s generally an uncontroversial point of view. It seems intuitively obvious to say that we have no way of looking at one man’s pain and another man’s pleasure and scientifically declaring one to be greater in magnitude by any particular amount. But the idea that comparing happiness between individuals is useful and important, even if theoretically shakey, is well established as well. This is especially clear when comparing the happiness of a marriage to the sadness of a paper cut, or the pleasure of a Sunday stroll to the despair of malicious torture. For starters, you should probably read Lionel Robbins’ famous essay, Interpersonal Comparisons of Utility: A Comment. It’s short (7 pages), but has influenced me a lot. You might also want to look into the ideas of Pareto efficiency and Kaldor-Hicks efficiency, which are the most relevant today.

5

My favorite argument against utilitarianism is the reductio ad absurdum:

6

That seems like a problematic way of defining a util, according to you its meaning differs to different people. My point is only that a util is not the same thing as a unit of happiness.

I’ve already read Nozick, but thanks anyway.

When I read a course called “Behavioral economics and economic policy” the lecturer said exactly that, but then she went on to say, “but let’s suppose that we can..”

Are you saying that we really can’t compare people’s happiness and pain, but that we like to think we can, since it seems that we can do it?

As I see it, it’s obvious that most people aren’t as happy as this fellow. And I am not saying something about utils as a measure of our preferences, but of happiness.

7

The reductio ad absurdum against libertarianism would go something like this: Picture the movie Harmageddon in the end, when Bruce Willis will detonate the bomb, and saving the planet. Suppose now that a starship is nearby that will be blown up along with the asteroid if the bomb is detonated. Being a firm believer that one should never, under any circumstances, initiate force against his fellow man Bruce doesn’t do anything, but let the asteroid hit the planet.

8

The fact that utility means different things to different people is a problem for utilitarians. That’s why they argued about it so fiercly. Check out the first chapter of John Stuart Mill’s essay, Utilitarianism, for an example of this sort of struggle. The difference between a unit of happiness and a util is mildly controversial, since it’s possible to hold that one’s wellbeing is simply one’s total amount of happiness, but most utilitarians won’t have any problem with saying that happiness is not the same as utility. But that doesn’t mean that utility is a useless concept. Quite the opposite; utilitarians would argue that happiness is irrelevant except as far as it composes part of the complex notion of utility.

On the issue of interpersonal utility comparison’s, I’m not saying that we should pretend that we can compare something that we can’t compare. I’m only saying that even though we can’t objectively measure cardinal utility, or calculate the difference between two people’s utilities, there are some cases where it is plainly obvious that one person’s gain is of greater magnitude than another’s loss, or vice versa. If you ask whether or not a net loss in utility will occur between us if my arm is chopped off with an axe, while you are given a pat on the back, it is clear that the answer is yes. There is, of course, no way to say exactly how much worse off I was made by having my arm chopped off, and no way to say exactly how happy the pat on the back made you, but under normal circumstances, we could very fairly say that my suffering outweighed your pleasure.

But most economists won’t even go this far. That’s why I suggested that you look into the ideas of Pareto efficiency and Kaldor-Hicks efficiency, which are much more commonly used today. That’s not to say that they are completely uncontroversial, because I can think of several objections myself, which are well known to most economists. But today, few economists are naive to the problems with utilitarianism, and most have adopted some way of addressing them without losing the ability to do their jobs.

[P.S. That baby rules; thanks!]

9

Oh, and on your second post, a lot has been made of the issue of rights as constraints, because an ethical system that would forbid Bruce Willis from saving the Earth seems unacceptable. One of the best discussions I’ve seen of this sort of thing can be found in Judith Thomson’s book, Rights, Restitution, & Risk (specifically, chapters 2-7). The problem you’ve highlighted is generally known as the Trolley Problem, originally conceived by Philippa Foot, and discussed extensively by Thomson in her book. I’d recommend looking at it if you have the time; it’s really interesting stuff.

10

I would say that it is a problem for those who try to discuss utility and happiness. Like your second paragraph - it seems that you are using utility to mean happiness, but in your last paragraph you say that economists don’t believe in comparing it between individuals, which only holds if you by utility mean something to describe preferences, as utility-as-happiness is not what economists mean by utility.

I know about Pareto and Kaldor-Hicks, but I don’t see any theoretical problems with (pleasure-hedonistic) utilitarinism, except that there is a (very large) practical problem of trying to measure and compare individuals sense of happiness.

11

I’m using utility to mean wellbeing, broadly defined. I do this because a lot of people have objected to the notion that happiness, or pleasure, is the same thing as wellbeing, and I think that they’re right. This struggle is foreshadowed in Mill’s Utilitarianism, when he writes about the Epicureans:

“…there is no known Epicurean theory of life which does no assign to the pleasures of the intellect, of the feelings and imagination, and of the moral sentiments a much higher value as pleasures than to those of mere sensation. It must be admitted, however, that utilitarian writers in general have placed the superiority of mental over bodily pleasures chiefly in the greater permenancy, safety, uncostliness, etc., of the former–that is, in their circumstantial advantages rather than in their intrinsic nature. And on all these points utilitarians have fully proved their case; but they might have taken the other and, as it may be called, higher ground with entire consistency. It is quite compatible with the principle of utility to recognize the fact that some kinds of pleasure are more desirable and more valuable than others. It would be absurd that, while in estimating all other things quality is considered as well as quantity, the estimation of pleasure should be supposed to depend on quantity alone” (11-12).

Building on this, people like Amartya Sen have tried to develop theories of wellbeing that include more than simply pleasure, or happiness. For example, Sen conceived of the idea that someone’s abilities should factor in. So according to this view, a person capable of playing the piano might be thought of as better off for it, even if the ability would not be fairly captured by reference to pleasure or happiness. Regardless of what you think about particular theories of wellbeing, it’s safest to use the word “wellbeing,” rather than pleasure, happiness, or welfare, since in doing so you avoid attaching yourself to a theory that many people entirely reject.

That being said, you also open yourself up to the accusation that you’re using a term that’s undefined, and therefore meaningless. I don’t think this is a fair critique, because it’s useful to talk about wellbeing even if we can’t say exactly what makes someone well off. But at the same time, we need to keep in mind that we don’t have an uncontroversial definition of what makes someone well off, or else we risk saying things that are easily proven wrong.

Taking this position on the nature of utility also makes it difficult to be a utilitarian in many ways. If we aren’t sure what we’re trying to maximize, then how can we try to maximize it? I would counter, though, that if we try to maximize the wrong thing, it’s just as bad. Personally, this whole tangled mess is why I usually gravitate towards process-based views of justice and optimality when at all feasible. But as Robbins pointed out in the essay I referred to earlier, we shouldn’t ignore the question of which road leads to the greatest levels of utility when discussing policy options.

If you’re interested in utilitarianism, though, I’d recommend checking out John Harsanyi’s essay, “Does Reason Tell Us What Moral Code to Follow and Indeed, to Follow Any Moral Code At All?”