Virtue Economics

How should we view virtues? Contemporary views on virtues conceptualize them as special abilities given to individuals by God or nature. In some schools, virtues are predispositions or proclivities that arise from one's biological makeup. In this essay, I argue that virtues should be viewed as resources. Indeed, a more complete picture of virtues does not necessarily exclude those views. However, viewing virtues as resources pushes the conversation on cultivation, spotting, and consequent management of said virtues forward in an economic landscape.

Viewing virtues as resources allows for classical economic analysis on resource allocation and scarcity in an economic landscape. Take compassion, for instance; as a resource, it is evident that it would be better allocated to industries like health care, especially nursing, because of the demands and nature of the work. As a resource in the healthcare industry, it can be used to produce a good or service, i.e., acceptable care to patients and employers. Admittedly, this view can be quite cynical, but the literature on compassion fatigue (the literature review will do) shows that it is a significant problem. While a sad fact, it does fit the resource model since resources are finite. The finiteness of specific virtues accounts for the "numbing" present in almost all fields when one is continually exposed to a particular form of stimuli.

Although viewing virtues as resources allows for economic analyses, it does not necessarily imply a need for an external regulatory structure. Primarily, the economic analyses that are prudent here are ones on incentives. For instance, it is fairly easy to observe that these resources are self allocating. Here we can think of aggression or bravery as a resource of sufficient value in MMA, the military, the police, extreme sports, and the like. We can also say the same for compassion in healthcare, justice in the legal field, etc. This is primarily because of incentives. These resources are allocated to domains with the most willingness and ability to afford them.

On the other side of the response to incentives, we can, and dare I say have, created structures that incentivize individuals with relatively lower comparative advantages in a field to go into areas where a specific virtue is scarce and offers relatively high returns. I would conjecture that this is not a good long-term strategy. This means, in equilibrium, these are the first set of people to experience burnout or fall out of the profession due to resource (i.e., the particular virtue of interest's) depletion. Viewing virtues as resources allows us to approach problems like burnout and dissatisfaction with work in the labor force (see examples here, here, and here) more objectively and clearly.

Viewing virtues this way also gives a window into a specific kind of problem prevalent in today's activist landscape - the resource curse of virtue. This happens when individuals with an abundance of a relatively scarce resource end up worse off than individuals with relatively less of that resource. To use compassion as an example, nursing might not be enough for individuals with levels of compassion that are at least one standard deviation above the mean of healthcare workers. This could lead to them being martyrs for a cause or joining a non-profit because of their extreme compassion. In other words, they are worse off than those who pick a field and use their virtue more judiciously in economic terms. The same can be said for traits like courage. A person with an abundance of the resource of courage might gravitate to risky activities and be blinded to the level of risk in said activity. This is not revolutionary; we all agree that if you are too courageous, you die. It is important to stress that there is no value judgment on these decisions. These examples merely point out the phenomenon.

A particular question arises here on the topic of renewability. Can there be professions or individuals whose virtues increase over time due to using these virtues in the Aristotelian sense? If so, then is the resource truly finite? Meaning, since resources imply scarcity, usefulness, and finitude if an individual can increase their virtues by learning (aka, gaining wisdom and temperance over time), then are virtues truly finite? In a tragic sense, virtues are limited because we are limited. As hosts for these resources, the level of a particular virtue we can cultivate has a natural limit. As for potentially increasing returns to virtues, I would be more agnostic. It is possible to encounter the resource curse of virtue as one grows their virtues. However, as one ages, they increase their virtue and, in the Aristotelian tradition, also acquire necessary complements to said virtues.

Overall, viewing virtues as resources allows for more mental clarity in thinking and approaching this topic and its implications. This analysis can continue to address issues of exploitation and manipulation that do arise in social interactions. This is an easy and effective update to one's mental model on humans, humanity, the self, and decision making.

Certainty Rating: 88%


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