The basic moral significance of neo-classical economics and the competitive market system it represents is founded on the classical liberal tradition in which the "simple system of natural liberty" is claimed to give expression to the harmony of each with all. Though such a common good would not be the outcome of the intentions of individual agents or state planning, nevertheless, the impersonal forces of a capitalist market would so allocate resources as to lead the self-interested participants in such an economy, as if by an "invisible hand", to a coherent social order of mutual advantage. The papers in this volume critically examine central aspects of the preceding social ethos underlying contemporary political economy and our increasingly globalized market culture. The inquiry is undertaken from a variety of disciplinary perspectives at the intersection of philosophy, economics, political science, sociology, psychology, and computer science.

This volume consists of papers derived from the Ninth International Conference on Studies in Economic Ethics and Philosophy (SEEP), held at Trent University in Peterborough, Ontario, Canada, in June of 2002. Let me take this opportunity to express my appreciation to Professor Peter Koslowski for his original stimulus, encouragement, and continual assistance in making the Conference a success. I would also like to thank my Trent colleague, Professor David Holdsworth, for his steadfast help in the management of the Conference and the papers resulting from it. I am obliged to Mr. Louis Taylor of North George Studios in Peterborough for his expert professional service in preparing the manuscript for printing. Finally, let me gratefully acknowledge the generous financial sponsorship of the Conference by the Social Sciences and Humanities Research Council of Canada, and Trent University's Department of Philosophy and Graduate Centre for the Study of Theory, Culture, and Politics. Bernard Hodgson Department of Philosophy Trent University Peterborough, Ontario, Canada May 2004 Contents Preface . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IX Introduction BERNARD HODGSON . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 Part One Setting the Problem Chapter 1 Public Interest and Self-Interest in the Market and the Democratic Process PETER KOSLOWSKI . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 Chapter2 The Invisible Hand and Thinness of the Common Good RICHARD DE GEORGE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38 CONTENTS Part Two Constraining the Invisible Hand Chapter 3 Hiring Invisible Hands for Public Works EDWARDJ. NELL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51 Chapter4 A Market Failures Approach to Business Ethics JOSEPH HEATH . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69 Chapter 5 Abstractions and Conceptual Automata in Economics and Non-Economics STEPHEN REGOCZEI . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Despite social and economic advances around the world, poverty and disease persist, exacerbated by the mounting challenges of climate change, natural disasters, political conflict, mass migration, and economic inequality. While governments commit to addressing these challenges, traditional public and philanthropic dollars are not enough. Here, innovative finance has shown a way forward: by borrowing techniques from the world of finance, we can raise capital for social investments today. Innovative finance has provided polio vaccines to children in the DRC, crop insurance to farmers in India, pay-as-you-go solar electricity to Kenyans, and affordable housing and transportation to New Yorkers. It has helped governmental, commercial, and philanthropic resources meet the needs of the poor and underserved and build a more sustainable and inclusive prosperity. Capital and the Common Good shows how market failure in one context can be solved with market solutions from another: an expert in securitization bundles future development aid into bonds to pay for vaccines today; an entrepreneur turns a mobile phone into an array of financial services for the unbanked; and policy makers adapt pay-for-success models from the world of infrastructure to human services like early childhood education, maternal health, and job training. Revisiting the successes and missteps of these efforts, Georgia Levenson Keohane argues that innovative finance is as much about incentives and sound decision-making as it is about money. When it works, innovative finance gives us the tools, motivation, and security to invest in our shared future.

And the consequences of this fact are profound.

Why economics needs to focus on fairness and not just efficiency One of the central tenets of mainstream economics is Adam Smith's proposition that, given certain conditions, self-interested behavior by individuals leads them to the social good, almost as if orchestrated by an invisible hand. This deep insight has, over the past two centuries, been taken out of context, contorted, and used as the cornerstone of free-market orthodoxy. In Beyond the Invisible Hand, Kaushik Basu argues that mainstream economics and its conservative popularizers have misrepresented Smith's insight and hampered our understanding of how economies function, why some economies fail and some succeed, and what the nature and role of state intervention might be. Comparing this view of the invisible hand with the vision described by Kafka—in which individuals pursuing their atomistic interests, devoid of moral compunction, end up creating a world that is mean and miserable—Basu argues for collective action and the need to shift our focus from the efficient society to one that is also fair. Using analytic tools from mainstream economics, the book challenges some of the precepts and propositions of mainstream economics. It maintains that, by ignoring the role of culture and custom, traditional economics promotes the view that the current system is the only viable one, thereby serving the interests of those who do well by this system. Beyond the Invisible Hand challenges readers to fundamentally rethink the assumptions underlying modern economic thought and proves that a more equitable society is both possible and sustainable, and hence worth striving for. By scrutinizing Adam Smith's theory, this impassioned critique of contemporary mainstream economics debunks traditional beliefs regarding best economic practices, self-interest, and the social good.

A contemporary interpretation of Adam Smith's work on jurisprudence, revealing Smith's belief that progress emerges from cooperation and a commitment to justice. In Smith's theory, the tension between self–interest and the interests of others is mediated by law, so that the common interest of the community can be promoted. Moreover, Smith informs us that successful societies do at least three things well. They promote the common interest, advance justice through the rule of law, and they facilitate our natural desire to truck, barter, and exchange. In this process, law functions as an invisible force that holds society together and keeps it operating smoothly and productively. Law enhances social cooperation, facilitates trade, and extends the market. In these ways, law functions like Adam Smith's invisible hand, guiding and facilitating the progress of humankind.

Is it possible for businesses to have a bottom line that is not profit and endless growth, but human dignity, justice, sustainability and democracy? Or an alternative economic model that is untainted by the greed and crises of current financial systems? Christian Felber says it is. Moreover, in Change Everything he shows us how. In this new and updated edition of the book that sparked a global movement, Christian Felber proposes a blueprint for an economics of everybody: ethical, dignified, sustainable and principled. He shows that The Economy for the Common Good is not just an idea, but has already become a broad international movement with thousands of people, companies, communities and organizations participating, developing and implementing it.