Ethics and description

In the past couple of days I’ve run into a couple of places in the internet that left we confused.

First, via Education Directions I noticed this article on the way of “valuing assets” that takes into account social value.  The claim is that:

Western accounting needs to recast the narrow, individualistic and economically bound concept of asset, claiming that much would be gained from recognising that there are things of value beyond those defined by individual property rights and economic reckoning

This seems like an aimless statement to me.  Private individuals value their asset based on issues of private value – this is hardly surprising.  Government takes into account concepts of broader “social value” when they do accounts, or look at the value of policies.  What methodological value is there from using a different word for social value to describe it?

Giving things new names doesn’t actually add value to how we describe them, unless the context is to translate these broad concepts for a cultural specific context!  In truth, it isn’t “western accounting” that needs to learn from this – if the government is trying to work out social value, then we would want to use standard western accounting methodologies with these specific cultural contexts in mind.

Now don’t get me wrong, the willingness to attack “western” accounting immediately shows that the authors want to attack an arbitrary strawman, than to credibly discuss what organisations are trying to achieve with accounting values and then asking how to transparently represent that.  And this brings me to my second link – Buddhist economics.

Contrary to the description given of “western” economics on this post, there is a focus on “social value” in mainstream economics – there is a huge focus on it.

But the very description behind Buddhist economics here is worse than that – for some reason the author of the Wikipedia page has decided that the purpose of economics is to tell people how to live their lives, rather than describing scarcity and trade-offs.  Given this, the article finds fault with economics because it dares to assume that people act in a self-interested way.

Of course, we’ve seen this ethical confusion before – a million times.  People presume that since economists are willing to discuss trade-offs we lack morals.  Now, a clear moral and ethical standpoint IS required to decide on what SHOULD be done, and what policy SHOULD be picked by government.  But everything that I keep seeing economists attacked for, and in this case accountants as well, is merely describing something.

Now does this happen because people find it hard to distinguish between description and prescription?  Or is the issue that people think economists framing of issues IS the driver of certain ethical outcomes in policy, and that our pretense of separating “description” and “prescription” is flawed?

3 replies
  1. JC
    JC says:

    “This seems like an aimless statement to me. ”

    Actually, it was pretty much the opening statement made by green groups in the 60s and 70s at any public meeting called to oppose some new development like dams, exotic forestry, a coal fired power station or some agricultural intensification.

    It was followed by slides showing some cute little critter or insect, its lifestyle, sex habits and the terrible fate it faced if the development went ahead. This would then morph into the effects on the general environment and ultimately the effect on humans.. followed by demonisation of the humans who were about to inflict this misery.

    Basically, this process was used to show how one greedy woodsman at the top of the stream would cause misery to the thousands living below.


  2. Eric Crampton
    Eric Crampton says:

    I just wish the authors of the accounting piece had gone further. Clearly double-entry bookkeeping is heteronormative as well and inadequately incorporates pluralistic notions of value from gender studies. I wonder if it’s the rampant homophobia in academic accounting departments that keeps them from seeing just how biased their whole method is.

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