Articles, papers and manuscripts

Coping with breast cancer in various cultures
Barbara Klose-Ullmann

published as "Umgang mit Krankheit in anderen Kulturen" in Barbara Klose-Ullmann (Ed.), Was machen wir aus der Krankheit?, Accedo Publishing, Munich 2006, ISBN 3-89265-091-8. EUR12,80



Coping with illness is a topic which has been of utmost interest to me since 1997 when I became very sick myself. I wanted to know how other people were coping with a life-threatening or chronic disease and how they were managing their lives. In my first book about people affected by illness I chose the interview approach (Klose-Ullmann, 2003).

As editor of this book I decided on a different strategy: The authors are expressing them­selves directly, i.e. without their thoughts and feeling being “channelled” by my ques­tions. Rather, I let them focus on aspects they wanted to cover. Nevertheless, there are some similarities to the interviews especially in the accounts of people affected by illness: Inter­viewees mentioned family and friends as the most decisive factor when asked what had helped them return to life. Sylvia Frey Werlen considers family and friends essential to getting her feet back on the ground. Claudia Reichelt is convinced that without her friends she would not have managed to “lead a rather content life” although she is strongly handicapped. Andreas Pawlas points out that “...getting healed depends on the relationship with the doctor, the relationship with other people - this is why very often the whole family gathers at the bedside of the ill person - and last not least on the relationship with God...”

This view is supported by scientific research. A study on happiness factors which the US psychologists Edward Diener and Martin Seligman did in 2002 at the University of Illi­nois, shows that close relations with family and friends and the commitment to spend time with them range on top of the happiness scale (cf. Time Magazine, February 7, 2005, p.41). Peter Herschbach, Professor of psychotherapy at Munich´s Technical Uni­versity comes to the same conclusion. He analysed the results of studies on life quality of more than 10,000 chronically ill patients and presented the results at a seminar in the “Evangelische Akademie Tutzing” in a paper “Chronic diseases and life quality”. The patients considered close ties to family and friends as an important indicator of their life quality.

In my cross cultural project which I have been working on for some time, I am also dealing with questions of life quality and coping strategies. I am interested in finding out how people are coping with illness in other countries and cultures and whether there are any cultural differences. I believe that people in Western countries can learn a lot from other cultures in this regard. Contrary to my first book which contains interviews with men and women suffering from various illnesses, I talk to women who had breast cancer, the reason being:
· As woman I feel more at ease – especially in case of cultural barriers - to interview women.
· Comparing coping strategies is more meaningful if there is a common mutual basis. Therefore I considered it feasible to interview women suffering from the same illness.
· The most “global” female illness is breast cancer.
· Breast cancer hits the woman in her femininity. Maybe this gives me some indication about how society views women.

Experiences in Japan
In summer 2004 I went to Japan and China for interviews. I did not know whether breast cancer was a taboo subject over there as in Western countries up to the seventies of the last century. I was all the more surprised when I had my first encounter in Japan. Appar­ently the interviewee had carefully studied my project description and the questions be­forehand and was now most willing to answer frankly. Also, it did not bother her that there was a male interpreter.

Seven years ago she had been diagnosed with stage III breast cancer. She had a double mastectomy. Her firm belief in her doctor helped her: “ If he cannot help me, nobody can.” After two weeks in the hospital she returned to her full-time job at a pharmaceutical company. Eleven months of chemotherapy followed: On Friday afternoons she went to the chemo treatment and needed the whole weekend to recover. Since she lived alone and very rarely had company she felt rather isolated - for her this was the hardest to deal with at that time. Therefore she was always looking forward to going back to work on Mon­day, to her “family”. Her way of coping with breast cancer was to focus on her job. (A few weeks later a woman from Jerusalem told me that it was quite normal in Israel to re­turn to the job very soon after the operation and to incorporate the chemotherapy into the normal work life. While it is possible to take a sick leave, people rarely do because of the tough job competition.)

My first Japanese interviewee´s dearest wish was to live beyond retirement age. She had been operated on when she was 45. In Japan you can retire at the age of 60. She also ex­pressed hope that my book would help other cancer survivors understand what they had gone through and would spread optimism.

In Japan I also heard about the Dandelion Club, a group of women whose breast cancer had been treated at Kyushu Cancer Center. I interviewed three club members. Together with a doctor from the Cancer Center they visit schools and talk to the mothers of pupils about the necessity of cancer check-ups and mammograms - also because of the children. As a study by Hiroshima University demonstrated, more than half of the children 12 years and older who were living in a home where the mother had breast cancer, were suf­fering from depression. According to Dr. Shinji Ono, oncologist at the Kyushu Cancer Center, every thirtieth woman in Japan is being inflicted with breast cancer, i.e. statisti­cally one mother per class (In Western industrialised countries almost every eighth is struck, but the chance of survival is higher than in Japan.), the higher mortality rate in Japan resulting from the rather belated introduction of mammography as compared with Europe. According to my Japanese interviewees, breast cancer is considered a deadly dis­ease. An American woman from Los Angeles who had been diagnosed with breast cancer three years ago pointed out to me that in the US breast cancer is not considered fatal but thought of more as another disease – and, indeed, it is much more common than in Asia. The statement by the American woman was challenged by my girlfriend in San Francisco who does not think that it is true yet! “It may happen as the meds get better and better and it will be treated more like a chronic disease that can flare up at any time.”

Surprisingly, all the women I interviewed in Japan had - following their cancer operation - joined a self help group of cancer patients in which they found compassionate women friends, and one even found the man of her life. All interviewees considered friendship as an enriching experience which they would not want to miss. The three women from the Dandelion Club asked me to point out that the diagnosis “cancer” does not mean the end of one´s life as for them it was the beginning of a most fruitful new period in life. My im­pression was that close friendships among women are rare in Japan. Therefore, maybe such a crisis was necessary for triggering such close friendship. Interestingly enough, only one interviewee mentioned that by loosing her breast she lost a symbol of her femi­ninity. She pleaded for psychological help. I got the impression she was the most uncon­ventional of my interviewees; being 36 years old at the time of operation, she was in any case the youngest.

As to the Japanese health insurance system, the full-time employees (together with the non-employed dependents) are normally insured by the employer. Employee´s health in­surance covers 70 to 80 percent of the costs of operation, chemo and radio therapies. In addition a private insurance against cancer, heart attack and stroke, or a life insurance policy lowers the amount people have to pay themselves but there is always some de­ductible (copayment). One interviewee told me that National Health Insurance Systems do not cover any expenses of rehabilitation as e.g. lymph drainage or massages, not to mention a stay in a rehabilitation clinic or a spa. If you change from a full-time to a part-time job as did my second interviewee, you incur important financial losses, for example there is no health insurance coverage via the employer.

By now, there are breast cancer check-up schemes which are partially being financed by the communities. In Fukuoka where two million people live this is done as follows: All women of 40 years and older are expected to go to a check up, including a mammogram, every two years. The patient pays 500 yen (about 4 EURO), the remainder being covered by the city of Fukuoka. In other Japanese cities this might be handled differently.


Experiences in China

The National Health System in China is undergoing a fundamental reform. It seems that up to now the statement has held true: “The poor die earlier.” There is a large gap in the quality of health care and coverage in cities and in rural China. One interviewee told me that most people in rural areas have no health insurance and are too poor to pay for medi­cal treatment themselves, if there is a doctor available at all.

If you are an employee of a government company or a public institution such as a univer­sity, hospital etc. (in most cases they are situated in a city, not in rural areas), the em­ployer, i.e. the government covers the expenses of your treatment in hospital and as out­patient. Up to 1998 it covered all expenses, since then the patient has to contribute 20 percent. I was told that nowadays you can obtain a policy with a private health insurance company which covers the deductible incurred as inpatient up to your 60th birthday. In the year 2000 independent insurance companies started business in China. The employee pays three percent of his salary, the employer six percent. Around 30 percent of the Chi­nese population has health insurance coverage. In cities, most families take out separate health insurance plans for their children as well; 70 or 80 percent of schools offer a group insurance for pupils to which the parents contribute small amounts annually. In addition there is a pupil accident insurance.

The Japanese as well as the Chinese National Health Insurance Systems are facing simi­lar problems of demographic development as in Germany: Life expectancy has increased considerably, the number of people older than 60 is rising; in 20 years there will be ap­proximately 170 million Chinese who are over 60 years old.

As mentioned, in Japan, breast cancer is considered a deadly disease whereas my Chinese interviewees thought of it as just another illness. This was confirmed by doctors like Dr. Wang, lung specialist in Tangshan. In her opinion there are three reasons for this attitude:

Often women are simply told nothing about the seriousness of their condition.
Breast cancer is considered curable as it can be removed fairly easily (in contrast to e.g. liver, stomach or kidney cancer).
Many women have no clue about possible consequences such as metastases since they lack any knowledge about cancer. This is especially true in rural areas.


In China, a breast cancer operation implies very often removing the whole breast as this is considered the safest method to get rid of the cancer cells. Only recently, a few surgeons in hospitals endeavour to save as much of the breast as possible or make a breast reconstruction, the latter with young women only. Nevertheless, in none of the interviews did I get the impression that the interviewee would quarrel over the loss of one or both breasts. One woman explained it to me as follows: A Chinese woman considers her breast important for breast feeding. Once this is done the breast has ful­filled its task. It can be removed if that is medically indicated. At least in rural areas and among the urban working population, the breast is not considered as symbol of being attractive, sexy or beautiful. Women and also men, for that matter, are putting up with the loss of the breast, the most important thing is having recovered. The out­ward appearance seems to become uninteresting past approximately 40 years of age.

In China, the body is considered more of an energy household than an object of beauty. According to the sinologist and philosopher Francois Julien in China
“the body is not viewed anatomically but energetically, as a kind of sack which is permeable for circulation of energy streams, focussed on e.g. by a person doing acu­puncture”.

A young oncologist in a very modern hospital in Hangzhou (close to Shanghai) told me of patient talks in his hospital. A patient who feels fairly well after breast opera­tion and chemical treatment is asked to visit other cancer patients on the ward and talk about her experience and impressions. He thinks this is a very good idea as the patients are much more convinced by advice of somebody who had breast cancer her­self than by recommendations from doctors. Also, he pointed out that he considers the combination of Western medicine and TCM (= Traditional Chinese Medicine) opti­mal as TCM can improve the psychological well being of patients which has a posi­tive effect on the overall condition of a person. Several interviewees mentioned to have taken TCM products for a number of years. To do Qi Gong exercises regularly also helped some women to stabilise body and mind.

In China it seems to be normal that colleagues visit the sick comrade in hospital or at home, bring her flowers and presents and inquire about her state of health. One inter­viewee told me that you identify yourself with the work group and with the company and that you care for each other. In other countries, she said, people might live maybe more isolated, more as individuals. I remembered an interview with a man in Finland who had cancer. He told me that during his hospital stay and while he had been stay­ing at home on sick leave, there had not been a single telephone call or visit by a col­league. He considered such behaviour rather normal in Finland. You distinguish be­tween work and your private life. And illness is part of your private life. Furthermore he suspected that Finns might not like to be confronted with a situation where they do not know how to react or what to say. But this is certainly not just a Finnish phe­nomenon.

Experiences in Finland

A few weeks after my trip to Asia I talked to three women in Helsinki about their coping with breast cancer. Compared to what I had heard in Japan and China I no­ticed distinct differences in the perception of the body. The three women I talked to told me how happy they were about the breast reconstruction as only thereafter did they like their own body again. In Finland, every woman who was operated with breast cancer gets an invitation to a discussion in a cancer clinic about further treat­ment (e.g. chemical, radiological, hormone treatment). After another two months or so you receive an invitation to a plastic surgeon for a breast reconstruction which, however, is not done before two years after mastectomy. All these measures are cov­ered by National Health Insurance. Although breast reconstruction (from abdominal skin or back muscles) was much more painful (“...as if you are under a bulldozer”) than the actual breast cancer treatment, my interviewees would undergo this compli­cated operation again. However, breast reconstruction is paid by the national health insurance only once. In the case of one woman, reconstruction had to be removed as there were metastases in the tissue underneath.

The different attitude towards your own body which I noticed in China and Finland, is possibly due to cultural differences in the body approach. Certainly the question plays an important role whether the costs are covered by the insurance company as is the case in many Western industrialized countries, or whether the expenses - as in China - have to be largely paid by the patient and her family. Why does insurance cover these expenses in many Western countries? This is not only a question of suffi­ciently large financial means and high development of an economy but also expres­sion of values prevailing in the respective country. In many European countries there is a sort of “basic right” to a whole (i.e. non-mutilated) body which is taken into ac­count. How this will be handled in the future facing the explosion of expenses in na­tional health care, remains to be seen.

Universal phenomena

It is worthwile to look again at the happiness factors mentioned in the beginning as the source of strength which play an important role in coping with illness. Some phenomena seem to be universally true.

With regard to my Japanese interviewees the primary source of their strength was the support by husband, children and family while the intensive new friendship with other women suffering from breast cancer enhanced life quality after their illness enormously. Husband, children and family were the essential source of power for my Chinese interviewees as well. Some told me that usually a family member would cook the meals for the sick woman and bring it to her to hospital. If this is not the case you do not starve but you have to eat the hospital food - which does not seem to be very good. In some cases the husband was much more worried than his sick wife, maybe because the Chinese doctors had told him the truth and had concealed it to the woman. A young sociologist student in Beijing explained it to me very prosaically: In China marriage is not a matter of love but a practical alliance, also in an economic sense. If one salary is missing, the balance is destroyed. The husband tries hard to get things back to balance – therefore his care. – However, it seems that there is also something like attachment. Some Chinese women told me “…after I had been sick my husband is much nicer to me. He is more tolerant and pays more attention to what I want.”

Not surprisingly, family and friends were an essential source of strength to my Fin­nish interviewees as well. In addition, being active and prove this to yourself contrib­uted strongly to the way back to life. Two of my interviewees took part in a remark­able project: Approximately 10 women from various European countries who had suffered from breast cancer went on an expedition to South America. They wanted to tackle the Aconcagua, a mountain approximately 6000 meters high. To both women this meant a huge challenge but they wanted to demonstrate that a good life is possi­ble after having been sick with breast cancer. In some countries, this seems to be rather unknown since breast cancer is not only tabooed but almost stigmatized. When the expedition team arrived in Santiago de Chile, there was a press conference. One journalist asked one of my interviewees: “How can you be married when you have breast cancer?”

One of the two made it up to the summit. For her this was an important step back to normal, namely that she could trust her body again. Also she wanted to set a clear sign to others: ”When I put the Finnish flag on the summit, I did not only do it for our team but for everybody who had been touched by cancer. Cancer is something that is not only in your body but it affects also the people around you, your family and your friends taking care of you.”



Looking at America

Finally I would like to write about a few impressions I got on my recent trip to Can­ada and USA. In London/Ontario I talked to a woman who had her first mastectomy 15 years ago. At that time such an operation required a hospital stay of ten days which was paid by the Canadian insurance company. My interviewee has the best memories of her stay in a private room with caring nurses and good doctors. She still thinks that these quiet and restful days contributed much to her recovery. Six years later she had another mastectomy. In the meantime she had given up teaching and they had moved to the US where her husband had a good job at a large corporation which offered good health insurance coverage. At that time the big health insurance companies were allowing mastectomy patients to stay in the hospital for just a few hours. My interviewee called it “drive through method”. Only with special permission by a doctor could she stay overnight in hospital and have it paid by her insurance company.

Today in Canada National Health Insurance covers 48 hours hospital stay at the most in case of mastectomy. However, as one woman in Montreal told me, patients want to leave hospital as soon as possible in order to avoid catching an infection. Her (pri­vate) health insurance paid the nurse visiting her at home.

A girl friend in San Francisco recently had to undergo a modified radical mastectomy with lymph dissection. She was asked to be at the outpatient surgery at 7:00 a.m. and stayed there until 3:00 p.m. when her husband picked her up. She was sent home with pain medication and instructions on how to empty out the bag attached to drainage tubes from her wound. Aftercare consisted in a phone call from a nurse a few days after the operation, and a visit to the surgeon after ten days, at which time the tubes and clamps were removed.

My girl friend used to be insured with her husband. However, after his 65th birthday he got on medicare and she had to get her own insurance coverage. This is about 440 Dollar per month with a co-pay for doctor´s visits, surgery, hospital etc. up to US-Dollar 2,500 annually. She could have stayed in hospital but would have had a co-pay of 200 dollars per night. Not liking hospitals for fear of catching infections, she chose to go home the same day. However, she is convinced that she would not have been able to manage without the help of her husband and a network of friends and cannot imagine how women without family or friends or women with small children can handle this situation. Her treatment seems very efficient. She has a great support team in her family, doctors, nurses, therapist, and cancer support group and she is recover­ing well. Her husband also has joined a support group of men whose partners have breast cancer.

In the US and Canada, the time of staying in hospital as inpatient was shortened con­siderably. Instead people are being treated as outpatients, triggering diverse reaction. Some people consider the “drive-through-method” much too risky, others believe it to be very appropriate and recommendable. A nurse working in Gillette Cancer Center which is part of the well-known Massachusetts General Hospital thinks very highly about breast cancer treatment in her hospital, i.e. to do lympectomy on an in-and-out-patient-basis and mastectomy with a stay in hospital of up to 48 hours paid by the in­surance company. However, in the U.S. there are approximately 40 million people without health insurance coverage. In the Gillette Cancer Center the patient has an appointment for a multidisciplinary session with the medical team consisting of on­cologist, surgeon and radiologist and the nurse. After this meeting the patient takes part in an informational session about life after breast cancer operation and chemical treatment. In this meeting, also former patients are talking about their experiences. In the meantime, the medical team including the pathologist meet for an in-depth discus­sion. Only thereafter, the date of operation is fixed. Nurse Gwen pointed out how im­portant it is that doctors and patients discuss diagnosis and possibilities of treatment in an interactive meeting. “Women should feel supported, out of danger, and thus be able to mobilise their strength”. It seems that Gillette Cancer Center has been pursu­ing this approach successfully. According to nurse Gwen, 85 percent of the patients who come for a second opinion are staying for the operation and return to their local doctor for further treatment.

Conclusion

In order to evaluate our health system it is helpful to look abroad. A comparison with health care in other countries shows that the German Health System is still scoring high despite all shortcomings. However, especially under the assumption of increas­ing claims to the system and given the existing structures this high level cannot be fi­nanced much longer. Therefore, a fundamental reform is necessary. Whatever the re­form of our Health Care System will look like, it should be kept in mind: We as indi­viduals can do something to stay healthy. When we are sick there are also often pos­sibilities for us as patients to contribute to recovery. According to health scientist An­nelie Keil, “a health program should not only focus on health but on the whole life of a person. Life is all the better, the more I take care of my health - or better – my over­all well being.” This book provides the reader with valuable ideas on the subject.


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Adam Smith's Model of Man and Some of Its Consequences
by
Manfred J. Holler*

Published in Homo Oeconomicus 23(3/4). ISBN 3-89265-063-2


Abstract: This papers discusses the relationship of the "model of man" presented by Adam Smith in The Theory of Moral Sentiments (1759) and the assumptions about human behavior which are quintessential for his An Inquiry into the Nature and Causes of the Wealth of Nations (1776/77). It is argued that Smith’s observation of a "propensity to truck, barter and exchange one thing for another" does not in general hold for human behavior. Moreover, there appears to be an inherent conflict with "sympathy", the key concept proposed in The Theory of Moral Sentiments, if we interpret it as the source of social evaluation, self-evaluation and individual action. Following Karl Polanyi's critical comments in The Great Transformation (1944), we will discuss some of the consequences of this incongruence for the philosophical foundations of modern economics and economic policy.

Presented at the conference on “Human Nature as the basis of Morality and Society in Early Modern Philosophy”, University of Tartu (Estonia), December 15-17, 2005. A version of this paper is forthcoming in Homo Oeconomicus 23(3/4), 2007, pp.1-22. A shorter version, entitled “Adam Smith's Model of Man and Why the Market Program Failed”, will be published in Acta Philosophica Fennica.


1. Introduction

There is hardly a more controversial writer in the history of economics and the social sciences than Adam Smith inasmuch as very different “social religions” identify their roots with his work. By many he is hailed as a prophet of free markets while others point to his elaborate moral theory and the fundamental social dimension of his thought (and life). One might argue that this is due to the fact that one group studied The Theory of Moral Sentiments (1759) while the other had his An Inquiry into the Nature and Causes of the Wealth of Nations (1776/77) at their bedside. It is very likely that only a very small percentage of those who refer to Adam Smith to sell their ideas about how to improve the world have actually read either of these books; and certainly very few have read both – let alone having read his correspondence or Lectures on Jurisprudence. The latter were compiled from notes of zealous students who attended his lectures at Glasgow University during the years before he went on the two-year grand tour of France. However, it seems superficial to blame the potential readership for not adequately accomplishing its obligation when it comes to Adam Smith. If there is an obvious shortcoming, and most ardent free trade proponents do not even study the Wealth of Nations, then there could also be a reason for this.
A possible answer to this puzzle could be that Adam Smith proposed at least two “models of man”: the model that he proposed to form the core of his economic theory is perhaps not particularly convincing from an empirical point of view and the second model, introduced in his Theory of Moral Sentiments, does not reach far enough to evaluate the outcome which corresponds to his economic theory from a social point of view. Adam Smith is known to have been a keen observer who elegantly generalizes his observations in the form of theoretical concepts. However, in this paper, I will argue that his observation of a "certain propensity of human nature"..."the propensity to truck, barter and exchange one thing for another" (p.117), which is at the heart of the Wealth of Nations, cannot be generalized: some people have this inclination, perhaps most people do not. If there is no general propensity to truck, barter and exchange then the emergence of the division of labor which is the "necessary, though very slow and gradual consequence" of this propensity, and "from which many advantages are derived" (p.117), remains unexplained. Or, is it a sufficient condition for the functioning of Smith’s economic model to assure an increasing division of labor that, at least, some people have this propensity who organize the markets and define the rules of the “economic game”? Although we have quite convincing models that suggest that the answer to this question may be positive, this is not what Adam Smith indicated.
However, it seems obvious that if markets are established throughout the economy and the invisible hand functions then the propensity to truck, barter and exchange is no longer needed either. Producers like the legendary baker will increase their prices and produce more if demand is larger than supply; and they will lower prices if they cannot sell the amount of goods they intended to sell, and produce less. If, in the long-run, the average price does not cover average costs, then the supplier will leave the market. The propensity to truck, barter and exchange has no specific function in this system.
It seems then that the propensity to truck, barter and exchange, which drives the engine that explains the “nature and causes of the wealth of nations", does not generalize in Adam Smith theory: there is no space for it if markets function and a commercial society forms. Moreover, to some extent this inclination seems to be in conflict with the model of man which Adam Smith derives from his observations in his Theory of Moral Sentiments. Here we have sympathy and the impartial spectator.
In Smith’s work there is a close link between sentiments and economic behaviour: “It is because mankind are disposed to sympathize more entirely with our joy than with our sorrow, that we make parade of our riches, and conceal our poverty. Nothing is so mortifying as to be obliged to expose our distress to the view of the public, and to feel, that though our situation is open to the eyes of all mankind, no mortal conceives for us the half of what we suffer. Nay, it is chiefly from this regard to the sentiments of mankind, that we pursue riches and avoid poverty. For to what purpose is all the toil and bustle of this world?” (Smith, 1982 [1759, 1790], p.50).
To Adam Smith, economic life is, by and large, a matter of sentiments. But there is also “the desire of bettering our condition, a desire which, though generally calm and dispassionate, comes with us from the womb, and never leaves us till we go into the grave… there is scarce perhaps a single instant in which any man is so perfectly and completely satisfied with his situation, as to be without any wish of alteration or improvement, of any kind” (Smith, 1981 [1776/77], p.341). Smith refers to this desire to explain the motivation for the accumulation of capital by means of saving. It represents a disposition of “man” which follows him throughout his life, “though generally calm and dispassionate.” However, there is another motivation for the accumulation of capital: to become rich. “In Smith’s view…man is inspired in commercial society to pursue the rewards of sympathy and the approbation through the means of acquiring wealth and property at the expense of seeking sympathy through virtuous behaviour. The pursuit of wealth thus tends to crowd out virtue as a means to be taken notice with sympathy” (Verburg, 2000, p.38). The argument here is that there is no theory of social justice which permits us to evaluate the overall economic outcome. The implications and consequences of the economic system narrow down the application of the individualistic moral theory and corrupt its standards.
Models are meant to represent by resembling reality “in certain respects and to certain degrees” (Mäki, 2005, p.304). Although similarity is a major issue in model building,[1] we have no explicit measure to express resemblance. In fact, the measure itself would be just another model with a new similarity problem attached to it. What is specific about economic models, and quite different to models in physics, is that reality tries to imitate models: managers talk about maximizing profits, politicians claim to maximize social welfare, and consumers defend their spending with references to preferences which form a “transitive, reflexive, and complete” order. In general, model builders ignore that economic models “fire back” to what they represent – models in physics do not (see Holler, 1982, for a discussion).
One of the consequences, which is vital for the interpretation of Adam Smith’s moral philosophy, is that the definition of property rights is subject to the values of the commercial society. Contrary to Adam Smith’s perspective to define wages which guarantee subsistence as a property right of workers that are protected by commutative justice, markets neither assure subsistence nor presuppose that workers can live from their wages and feed their families. Market economists do not accept property rights on wages which guarantee subsistence. But this omission of distributional justice is not in line with Adam Smith’s word. I will come back to this argument.
First, however, in the next section, we will look at and discuss Adam Smith's Theory of Moral Sentiments and the model of man it contains. We will compare this model to one found in the Wealth of Nations. In section 3, we confront the results with implications which derive from the propensity to truck, barter and exchange, on the one hand, and the market economy, on the other. Some conjectures about why a theory of social justice is missing in Adam Smith concludes the paper in section 4. Appendix A serves to clarify the concepts of sympathy, altruism and empathy, and the relationship between them. Appendix B contains Adam Smith’s socio-economic balance sheet.

2. Sympathy

The cornerstone of the model of man in Adam Smith's Theory of Moral Sentiments is sympathy which derives from the potential to put ourselves in the position of others to see things from their point of view. Sympathy is not restricted to altruistic fellow-feelings, although they might derive from it, but even allows for reflections about one's own conduct. "Pity and compassion are words appropriated to signify our fellow-feeling with the sorrow of others. Sympathy, though its meaning was, perhaps, originally the same, may now, however, without much impropriety, be made use of to denote our fellow-feeling with any passion whatever" (Smith, 1982 [1759, 1790], p.10). It is not the passion of others which puts our sympathy in motion, but our hypothetical experience of being in the other person's position.[2] "Sympathy, therefore, does not arise so much from the view of the passion, as from that of the situation which excites it. We sometimes feel for another, a passion of which he himself seems to be altogether incapable; because, we put ourselves in his case, that passion arises in our breast from the imagination, though it does not in his from the reality. We blush for the impudence and rudeness of another, though he himself appears to have no sense of the impropriety of his own behaviour; because we cannot help feeling what confusion ourselves should be covered, had we behaved in so absurd a manner" (Smith, 1982 [1759, 1790], p.12).
More drastically, Adam Smith observes: "We sympathize even with the dead, and overlooking what is of real importance in their situation, that awful futurity which awaits them, we are chiefly affected by those circumstances which strike our senses, but can have no influence upon their happiness" (Smith, 1982 [1759, 1790], p.12).
This notion of sympathy differs substantially from David Hume's notion as the following quotation shows: "When I see the effect of passion in the voice and gesture of any person, my mind immediately passes from these effects to their causes, and forms such a lively idea of the passion, as is presently converted into the passion itself" (Hume, 1978 [1739]), p.576). In Hume, it is the other's experience and expression which triggers the fellow feelings, in Smith the fellow feelings are due to the other's situation or action. Hume's notion of sympathy implies a potential of altruistic (or spiteful) fellow feelings – a feeling for the other. In principle, this does not concur with Adam Smith’s notion of sympathy which is a feeling for oneself, and not for the other, although it presupposes a significant other. As quoted above: “We blush for the impudence and rudeness of another, though he himself appears to have no sense of the impropriety of his own behaviour.”
Unfortunately, the notions of Hume and Smith get somewhat blurred when the other's situation or action is accompanied by observed passion then it is no longer obvious whether it is the passion or the situation of the other which induces our feelings.[3]
There are immediate consequences of Smith's notion of sympathy: the potential of self-evaluation and the pleasure of mutual sympathy.[4] Let us first look at the potential of self-evaluation. Smith (1982 [1759, 1790],p.109) observes that the "principle by which we naturally either approve or disapprove our own conduct, seems to be altogether the same with that by which we exercise the like judgements concerning the conduct of the other people. We either approve or disapprove of the conduct of another man according as we feel that, when we bring his case home to ourselves, we either can or cannot entirely sympathize with the sentiments and motives which directed it. And in the same manner, we either approve or disapprove of our own conduct, according as we feel that, when we place ourselves in the situation of another man, and view it, as it were, with his eyes and from his station, we either can or cannot entirely enter into and sympathize with the sentiments and motives which influenced it. We can never survey our own sentiments and motives, we can never form any judgement concerning them; unless we remove ourselves, as it were, from our own natural station, and endeavour to view them as at a certain distance from us. But we can do this in no other way than be endeavouring to view them with the eyes of other people, or as other people are likely to view them." Smith (1982 [1759, 1790],p.109) continues: "We endeavour to examine our own conduct as we imagine any fair and impartial spectator would examine it." It could be enough to argue that people follow this pattern and that is why sympathy allows for self-evaluation. Smith gives a further argument: "In this, therefore, as well as in every other emotion, passion, and habit, the degree that is most agreeable to the impartial spectator is likewise most agreeable to the person himself..." (Smith 1982 [1759, 1790], p.262). As we are social beings we do not ignore the judgment of others. On the contrary, we strive for their appreciation and are therefore willing to change our habits and our behavior such that others can agree with them.
The impartial spectator perspective, which derives from sympathy, thus becomes operational to evaluate, to control and to restructure our behavior. It influences our conduct without identifying the evaluators, i.e., their judgments or, more specifically, their preferences or value systems. In modern terms, it could be understood as the result of a comparison of expected values. There is a certain equivalence between the unknown evaluators and Rawlsian veil of ignorance. In A Theory of Justice, Rawls (1972) repeatedly refers to Adam Smith impartial (sympathetic) spectator.
The impartial spectator is rather complex creature when applied to other persons. There is a “first-person-plural perspective I share with all others to whom my judgment is implicitly addressed” (Darwall, 1999, p.160) and, secondly, I put myself into the shoes of the person being judged by me. “When I make a moral assessment of someone’s motive or feeling, according to Smith, I express a sympathy with it that I expect any one (of us) to share. I impartially project myself into that person’s standpoint, not as myself but as any of us, and (attempt to) judge what any of us would be moved to do or feel if in that person’s shoes” (Darwall, 1999, p.160).
The construct of an impartial spectator and the self-evaluation by means of sympathy presupposes that there is some common platform of experience in this society. This is what Adam Smith calls the pleasure of mutual sympathy (Smith 1982 [1759, 1790],p.262). Not friendly fellow-feelings triggers this pleasure but the fact that sympathy can work because of the common experience which the members of a society share. The common experience creates the familiarity, paired with universality, on which the impartial spectator functions (see Witztum, 1999, p.248). "Man, say they, conscious of his own weakness, and of need which he has for assistance of others, rejoices whenever he observes that they adopt his own passions because he is then assured of that assistance; and grieves whenever he observes the contrary, because he is then assured of their opposition" (Smith 1982 [1759, 1790], pp.13f). If our passions (and thereby our evaluations and judgments) are confirmed by others then we feel good, although the passions as such can result from sorrows and pain.[5]
Smith’s moral sentiments require a “moral community” (see Darwall, 1999, p.160) of common understanding and experience. Given such a community, it seems that, at least in the short run, we have no control of the pleasure of sympathy and the pain of opposition as they "are always felt so instantaneously, and often upon such frivolous occasions, that it seems evident that neither of them can be derived from such self-interested consideration..." (Smith 1982 [1759, 1790], p.14). Even an ultimate hero like Lord Nelson could shed tears in a society which valued this expression of emotions rather highly. In a review essay in The New York Review of Books, Brewer (2005, p.57) points out that the “…idea that the ability to express feelings had become a commonplace of eighteen century medical theory and philosophy.” Here Brewer refers to Adam Smith’ Theory of Moral Sentiments and points to a “cult of feeling” which came along with Georgian sentimentalism.
We could, however, easily construct an evolutionary model which illustrates that by the fact that pleasure results from a congruence of passion, there will be a convergence into “shared feelings” if there is a common experience.[6] But what guarantees common experience? In a society either characterized by hierarchy and social segmentation or the division of labor common experience can be scarce.
Moreover, we do not get a social ethics, i.e., a theory of justice, from the working of sympathy as described above, which permits us to evaluate social situation and generalize the result. The fact that all members of the society blush if x prevails, given a common experience, does not imply that x is bad, should be banned or forbidden, etc. There is no direct link in Adam Smith’s moral theory which transforms the personal experience into a social value, even if this personal experience is shared by all members of the society. One reason is that the very same sensation (“expression of fear”) can derive from various experiences and some of them cannot be subject of a moral evaluation. People express fear because nature threatens them (“Black Death”) or because they are under the spell of a devilish dictator.
In Adam Smith’s writings the notion of self-interest does not necessarily coincide with the term egoistic or selfish as the above citation demonstrates. In most cases it can be paraphrased as “focused on oneself.” This seems to be obvious from the following quotation: "Sympathy...cannot, in any sense, be regarded as a selfish principle. When I sympathize with your sorrows or your indignation, it may be pretended, indeed, that my emotion is founded in self-love, because it arises from bringing your case home to myself, from putting myself in your situation, and thence conceiving what I should feel in the like circumstances. But though sympathy is very properly said to arise from an imaginary change of situations with the person principally concerned, yet this imaginary change is not supposed to happen to me in my own person and character, but in that of the person with whom I sympathize” (Smith, 1982 [1759, 1790], p.317).
In today’s use of the language it seems appropriate to substitute use of “character” in this phrase with “characteristics”: they specify the personal and social conditions of the other, but not his or her value system. “When I condole with you for the loss of your only son, in order to enter into your grief, I do not consider what I, a person of such a character and profession, should suffer, if I had a son, and if that son was unfortunately to die: but I consider what I should really suffer if I was really you, and I not only change circumstances with you, but I change persons and characters. My grief, therefore, is entirely upon your account, and not at least upon my own” (Smith 1982 [1759, 1790], p.317). However, one might add, it is still my grief and has no immediate impact on how you feel about the loss of your son.
Smith observes that fellow-feeling, which is based entirely on the account of somebody else, “is not, therefore, in the least selfish. How can that be regarded as a selfish passion, which does not arise even from the imagination of anything that has befallen, or that relates to myself, in my own proper person and character, but which is entirely occupied with what relates to you? A man may sympathize with a woman in child-bed; though it is impossible that he should conceive himself as suffering her pains in his own proper person and character. That whole account of human nature, however, which deduces all sentiments and affections from self-love, which has made so much noise in the world, but which, so far I know, has never yet been fully and distinctly explained, seems to me to have arisen from some confused misapprehension of the system of sympathy” (Smith, 1982 [1759, 1790], p.317).

3. Self-Interest, Market Society, and the Invisible Hand

Although the tears I may spread “when I condole with you for the loss of your only son, in order to enter into your grief,” cannot be an expression of selfishness, they do not contradict that I am self-interested. For example, if I suffer from such emotional experiences I could try to avoid situations which are strongly connected with such experiences. Self-interest plays a minor role in The Theory of Moral Sentiments, but it is standard to consider to be a cornerstone of The Wealth of Nations. However, as we see from the quotation in the introduction of this paper, the dynamics of Smithian economy does not derive from self-interest but from a "certain propensity of human nature"..."the propensity to truck, barter and exchange one thing for another" (Smith, 1981 [1776/77], p.25). The division of labor follows from this propensity, and a substantial increase of productivity and “opulence” are results of the division of labor.[7] From this further division of labor and more opulence follows.
Obviously, self-interest is conditional to this scheme. The core of this scheme is the model of man which presupposes "the propensity to truck, barter and exchange one thing for another". Of course, this propensity can be observed, but is it shared by many people? Is it a “necessary consequence of the faculties of reason and speech” (Smith, 1981 [1776/77], p.25)? If there are serious doubts that this propensity is so general a human feature as proposed by Smith, one might still argue that it suffices if some people in a society have this inclination. Then, however, one has to show how this inclination becomes prominent for the development of the economy.
However, let us assume that we all share this propensity. Does the division of labour and opulence follow? Empirically, we have to observe that the propensity to truck, barter and exchange differs in various cultures, but it is far from obvious that a stronger inclination leads to more division of labor and opulence. Theoretically, the arguments given by Adam Smith are not conclusive. Why should the propensity to truck, barter and exchange lead to a growing division of labor? Of course, the division of labor implies a potential for exchange – without exchange the division of labor does not work. But from this we cannot conclude that the mere fact (or assumption) of a propensity to exchange create an increasing division of labor, or establish markets.[8] In fact, one could argue that with an increasing division of labor barter and exchange become more trivial and satisfy less our inclination (if it exists). In general, goods from an assembly line are not subject to barter, but traded on markets.
It is obvious that Adam Smith’s proverbial baker does not produce his bread because of an inclination for barter and exchange, but out of self-interest and because there is demand for it such that he can make some profit. This profit gives him the means to obtain goods that he does not produce himself, although he is in want of them for consumption or investment. Markets create anonymity; there are buyers, sellers, goods and prices. If markets function, there is no need and no empty space for barter and exchange. Self-interest and the set of rules which determine the organization of a market (plus perhaps the physical needs) seem to be sufficient. However, is the market a consequence of self-interest and is there an inherent tendency of the market economy to expand and thus to support an increase of the division of labor? If we can justify a “yes” to both questions, then we have an explanation for the growing market economy that Smith proposes in the Wealth of Nations. Of course, these questions touch on problem of the origin of markets. Obviously, self-interest is an essential ingredient to the function of the market, but also fuelled economies which did not focus on the market. In the classical period of Greece and Rome, the members of the political and social elite owned land which was used to grow food and to deliver other necessities of life. Productions relied on slaves. The interest of the landowners was autarky. Only surpluses were brought to the market and, in good days, the revenues were spent on luxury goods. The latter were considered presents of fortuna. A similar pattern prevailed in Northern Europe before the Industrial Revolution.[9]
A prominent feature of a self-sufficient economy is that, contrary to the implication of neoclassical models of production and consumption, neither the allocation of inputs, especially of labor, nor the use of the produce depend on market prices and their variation. This was part of the independence which, in Republican Athens distinguished a full-fledged citizen of the first class, from members of lower classes. In Rome, Senators and other members of the ruling class were meant to plough their own land, or, at least, claim to do so, together with their slaves. In what we call pre-industrial time, "as a rule, the economic system was absorbed in the social system, and whatever principle of behavior predominated in the economy, the presence of the market pattern was found to be compatible with it“ (Polanyi, 1968[1944], p.68). "Up to the end of the eighteenth century, industrial production in Western Europe was a mere accessory to commerce" (Polanyi, 1968[1944], p.74).
Moreover, with a look into history, Karl Polanyi summarizes that “the principle of barter or exchange… revealed no tendency to expand at the expense of the rest" 1968[1944], p.68). This observation contradicts the conclusion which Adam Smith drew on the expansion of division of labor that was fuelled by the "propensity to truck, barter and exchange one thing for another." Polanyi (1968[1944], p.57) maintains that “…the gearing of markets into a self-regulating system of tremendous power was not the result of any inherent tendency of markets towards excrescence, but rather the effect of highly artificial stimulants administered to the body social in order to meet a situation which was created by the no less artificial phenomenon of the machine." Clearly, it would be interesting to discuss what these “highly artificial stimulants” are and how they work, but they are not part of Adam Smith’s economic system, although it presupposed regulation of markets such that the competitive forces sustain and do not give way to monopoly, collusion or chaos. This is obvious from his chapter on banking. (See Book II, Chapter II in the Wealth of Nations.)
The invisible hand needs the help of a regulating authority to do its job. Adam Smith did not in general assume that markets regulate themselves. Obviously, the concept of a self-regulating market economy transgresses the borders of the economic sector to which Adam Smith, more or less, confined the working of the invisible hand. As stated by Polanyi (1968[1944], p.71), "a self-regulating market demands nothing less than the institutional separation of society into an economic and political sphere".
However, the economic sphere will become dominant for society, since “a market economy can only exist in a market society. ....A market economy must comprise all elements of industry, including labor, land, and money" (Polanyi , 1968[1944], p.71).[10] "The extreme artificiality of market economy is rooted in the fact that the process of production itself is here organized in the form of buying and selling" (Polanyi , 1968[1944], p.71).
In Adam Smith, production itself is also organized in the form of “buying and selling." This is a consequence of the division of labor combined with the “propensity to truck, barter and exchange.” It does not necessarily follow that this principles carry over to other branches of society, but it is difficult to see how the social life of the working people should not be affected in its essence by the “buying and selling” of labor. This is the root of Karl Marx’s well-known critique of the capitalist system, but also, from a quite different angle, the point of departure of John Ruskin’s cultural theory.[11]
It seems that Adam Smith was quite aware of the conflict between the division of labor and the model of man that he suggested in his Theory of Moral Sentiments. In the Wealth of Nations we can read: “In the progress of the division of labour, the employment of the far greater part of those who live by labour, that is, of the great body of the people, comes to be confined to a few very simple operations; frequently to one or two. But the understandings of the greater part of men are necessarily formed by their ordinary employments. The man whose whole life is spent in performing a few simple operations, of which the effects too are, perhaps, always the same, or very nearly the same, has no occasion to exert his understanding, or to exercise his invention in finding out expedients for removing difficulties which never occur. He naturally loses, therefore, the habit of such exertion, and generally becomes as stupid and ignorant as it is possible for a human creature to become” (Smith, 1981 [1776/77], p.781f). He concludes “this is the state into which the labouring poor, that is, the great body of the people, must necessarily fall, unless government takes some pains to prevent it.”
Smith brings forward two major arguments why the public should be interested in the education of the “common people.” The first is to support or to maintain the martial spirit of the great body of the people, which is necessary to defend the country and assure the security of its citizens, and to increase their power of judgement and resistance against “the delusions of enthusiasm and superstition, which among ignorant nations, frequently occasion the most dreadful disorder. An instructed and intelligent people besides are always more decent and orderly than an ignorant and stupid one. They feel themselves, each individually, more respectable, and more likely to obtain the respect of their lawful superiors, and they are therefore more disposed to respect those superiors. They are more disposed to examine, and more capable of seeing through, the interested complaints of faction and sedition, and they are, upon that account, less apt to be misled into any wanton or unnecessary opposition to the measures of government. In free countries, where the safety of government depends very much upon the favourable judgment which the people may form of its conduct, it must surely be of the highest importance that they should not be disposed to judge rashly or capriciously concerning it” (Smith, 1981 [1776/77], p.788). However, not every government is likely to profit from the “judgment which the people may form of its conduct”, combined with a “martial spirit.”
The second argument is Smith’s belief that public education could compensate for the increasing alienation inherent to the division of labor and to overcome the “drowsy stupidity” (Smith, 1981 [1776/77], p.783) which tends to result from it. However, as stated by Emma Rothschild (2001, p.98), for Adam Smith “education is more generally something which is not only useful …but also amusing.” She concludes, for Adam Smith, “government supported education is in no sense something which is itself needed in the interest of commercial prosperity. It is consequence of economic advancement, and not a requirement for further advancement” (Rothschild, 2001, p.98).


4. The Missing Book

The above discussion demonstrates that while Adam Smith’s economic theory prescribes and assumes social institutions like the market and the government, his moral theory is limited to the evaluation of individual behavior.[12] It is therefore inadequate to evaluate the results and possible outcomes implied in his economic theory. For instance, it does not allow us to derive moral principles for the evaluation of the distribution of income or wealth, or to discuss the perhaps conflicting interests of labor, capital and land owners.
To some extent, this shortcoming reflects that Adam Smith did never accomplish the third book of his grand scientific scheme dedicated to the analysis of the State (or, equivalently, the Law).[13] In the closing lines of The Theory of Moral Sentiments he states: “I shall in another discourse endeavour to give an account of the general principles of law and government, and of the different revolutions they have undergone in the different ages and periods of society, not only what concerns justice, but in what concerns police, revenue, and arms, and whatever else is the object of law” (Smith, 1982 [1759, 1790], p.342). Why did he never accomplish this work?
In the “Advertisement,” which introduces the sixth edition of The Theory of Moral Sentiments published in 1790, the year of his death, Smith refers explicitly to the above quote commenting: “In the Enquiry concerning the Nature and Causes of the Wealth of Nations, I have partly executed this promise; at least so far as concerns police, revenue, and arms. What remains, the theory of jurisprudence, which I have long projected, I have hitherto been hindered from executing, by the same occupations which had till now prevented me from revising the present work. Though my advanced age leaves me, I acknowledge, very little expectation of ever being able to execute this great work to my satisfaction; yet, as I have not altogether abandoned the design, and as I wish still to continue under the obligation of doing what I can, I have allowed the paragraph to remain as it was published more than thirty years ago, when I entertained no doubt of being able to execute every thing which it announced“ (Smith, 1982 [1759, 1790], no page number).
Of course, in the literature, we find, more or less profound, speculations about the “occupations which had till now prevented me from revising the present work.” His biographers repeatedly mention that he was quite exhausted after he finished the Wealth of Nations. Moreover, in the following years he suffered from the death of dear friends and very close family members. Smith’s mother died in 1784 and his cousin Janet Douglas in 1788. This could be one explanation, another of course is that he had no convincing idea how to close the gap between his economic theory and his moral theory. He might have contented himself with the argument that in times of extreme scarcity and starvation that the number of people who achieve an income above subsistence is quite a good indicator of the wellbeing of a society – and an evaluation of the distribution of income and wealth or the discussion of control over the means of production can be postponed.[14]
Subsistence, however, can also be interpreted as the measure rod for social justice. Witztum (1999, p.255) argues that Adam Smith "would agree with considering the failure of distributing subsistence as a violation of justice in its commutative sense (i.e., requiring positive reprisal)" as it "will create harm and injury, not only through labourer's frustrated expectations, but through physical and mental hardship as well" (Witztum, 1999, p.256).[15] In the Theory of Moral Sentiments we can read that “we are said to do justice to our neighbour when we abstain from doing him any positive harm, and not directly hurt him, either in his person, or in his estate, or in his reputation. This is that justice which I have treated of above, the observance of which may be extorted by force, and the violation of which exposes to punishment” (Smith, 1982 [1759, 1790], p.269). Not doing harm includes the non-violation of property rights which are the consequence of the principle of stable possession.[16] The resentment, as a result of the violation, and which is “sympathized with by the impartial spectator is the basis of punishment” (Salter, 1994, p.302).
If we follow this line of argumentation in Salter (1994) then it follows that Adam Smith’s specifications of property right are subject to social conventions. His definition of justice implies abstaining from taking what others already rightfully and legally possess, however, what is meant by rightfully and legally is subject to the impartial spectator. Given the violation of subsistence and the sentiments which it arouses, Witztum (1999, p.248) concludes that "both familiarity and universality of such sentiments in the age of commercial society would have guaranteed the impartial spectator's approval of their resentment and would demand an enforced recompense." This, however, can be questioned if the outcome of the invisible hand, i.e., the market economy, private property, free trade and division of labour, has achieved the status of the law of nature (or of divine order).
Universality and familiarity are “socially dependent and relative” (Witztum, 1999, p.248). The self-declared prophets of the Wealth of Nations have successfully worked on a reinterpretation of Adam Smith's theory to achieve this goal, and the impartial spectator's view and sympathy changed accordingly (see Rothschild, 2001). If there are resentments because subsistence is not achieved, then they will be weak and most likely there will be no call for dramatic action or reprisal. This is, of course, supported by the fact that the invisible hand is impersonal and it is difficult to focus resentments on, for example, the “capitalist system.”
One should add that Adam Smith was quite aware that subsistence by appropriating the fruits of labour is not guaranteed even in societies of some surplus with the consequence of “destroying a great part of the children which their fruitful marriages produces” (Smith, 1981 [1776/77], p.98). Consequently, Witztum (1999, p.259) concludes, "...such an organisation of society will clearly be unjust" However, in Adam Smith’s work we do not find a recipe of how to overcome this injustice (if not by economic growth which makes labor scarce and pushes wages above subsistence). Moreover, can we conclude that a distribution of income is just if it does not violate subsistence for labour?
A brief review of modern moral philosophy shows that the book that Adam Smith meant to write is still missing. In his very influential “Anarchy, State and Utopia”, Robert Nozick (1974) mimics the market to derive a “minimum state” mainly restricted to produce security within its domain and protect its citizens from outside aggression. Applied to the market economy, the state guarantees the necessary degree of “safety rules” such that the market can function. Consequently, market results are sui generis “justified and just” if competition works: justice derives from the invisible hand. Of course, this theory is inadequate to compare alternative market outcomes, not to speak of results which do not derive from markets.
While Nozick’s theory is based on the construct of an anonymous interaction of people via the market, Ken Binmore’s theory of justice (Binmore, 1994, 1998) refers to bilateral interaction, face-to-face-bargaining, and an evolution of common standards of evaluation which derives from these possibly repeated relationships. His theory ignores the forming of groups, unions, associations, parties, etc., which become relevant whenever more than two people interact. As long as people act solely as individuals and meet in pairs, Binmore’s theory seems a relevant contribution. However, it is not obvious why the principles of human conduct which derive from such a theory should carry over into a world which is dominated by social entities (i.e., coalitions) such as firms, trade unions, clubs, and political parties. The standards of evaluation, which result from the bilateral bargaining model could justify a specific income distribution that could never result from a society with a coalition structure. Technically speaking it could well be that the result from bilateral bargaining is not in the core, and therefore not feasible without the intervention of an external authority. However, why should the authority intervene to guarantee a result which is justified by bilateral bargaining when the society is structured in coalitions?
Rawls’s theory of justice (Rawls, 1972) became popular and even entered textbooks of microeconomics because it allowed for the evaluation of income distributions. Its well-known and somewhat vulgarized maximin implication says that we should prefer a society A to a society B if the least advantaged citizen (or group of citizens) is worse off in B than in A, irrespective of whether the average income of B is larger or smaller than A. Given that the average income forms an expectation behind a veil of ignorance, its disregard triggered substantial criticism.[17] Another problem is that people might accept Rawls’ “two principles of justice,” yet, still reject the maximin principle for evaluating social outcomes as it may violate the implications of sympathy. Adam Smith repeatedly pointed out that people have a “… disposition to admire, and almost to worship, the rich and the powerful, and to despise, or, at least, to neglect persons of poor and mean condition …” (Smith, 1982 [1759, 1790], p.61).


Appendix A: Sympathy, altruism, and empathy

Let us assume that ui(.) expresses the (personal) utility function of agent i and uji(.) represents agent j's (personal) utility function as assumed by i. The situation (position) of i and j is summarized by si and sj, respectively. Then we can write sympathy, altruism and empathy as follows:

Sympathy

ui(si,sj), with partial sympathy given by ui'(sj).[18]
Altruism

ui(si,uji(sj)), with pure altruism given by ui*(uji(sj)).
Empathy

uik(si) > ujk(sj), with k as the un-involved observer.
What seems more plausible: uik(si) > ujk(sj) or uk(si) > uk(sj)?

Binmore (1994, 1998) illustrates the working of empathy for the case of Adam and Eve: If Adam and Eve are represented by k and i, respectively, uik(si) implies that Adam is the un-involved observer who needs to imagine himself in her shoes with her preferences (and her beliefs). Thus, starting from the self-centered preference relation uk(sk), empathy implies a perfect substitution of roles and preferences with the qualification that uik() does not express the preferences of i but the preferences of i perceived by k. If this substitution works then it should be possible that Adam is in a position to compare the two alternative situations which could be relevant for Eve: (1) Eve enjoying the apple, represented by si°, and (2) Eve enjoying a fig leaf, represented by si*. A possible result of this comparison is uik(si°) > uik(si*) with the consequence vividly illustrated in Massaccio's "The Expulsion of Adam and Eve from Paradise" in the Brancacci Chapel of Santa Maria del Carmine at Florence.
Adam Smith’s impartial spectator combines agent i's sympathy with the empathetic preferences of others, k, directed to his or her own position, si. It seems that i's reaction on the assumption of an impartial spectator can be described by max ui[uik(si)], the maximum i gains from the k's evaluations of i's situation. Note that while uik(si) > ujk(sj) compares k’s empathetic preferences of two individuals i and j, related to their corresponding situations si and sj, uik(si°) > uik(si*) expresses k’s empathetic preferences of individual i being in situations si° and si*, respectively.


Appendix B: Adam Smith’s socio-economic balance sheet

The following “balance sheet” tries to summarize the hypothesis presented in this paper. It has been argued that Adam Smith did not develop a theory of social justice which is applicable to a society that is no longer constrained by the subsistence level income of the major part of its workforce with the possibility of starvation and early death in the case of economic stagnation or recession. Adam Smith’s moral theory describes how an individual acquires his or her moral standard in the society he or she lives in. However, it does neither tell us how the society develops its moral standards nor does it propose a procedure or basis of values which allows to derive standards of social justice. For example, unlike Rawls’s theory of justice (Rawls, 1972), we do not find theoretical arguments in Adam Smith that suggest an evaluation of the distribution of income or wealth. This is not to say that Adam Smith had no distributional concern, but that he did not develop a corresponding theory of it.[19]

Table 1: Adam Smith’s socio-economic balance sheet

Ethics Economics


Moral theory: moral sentiments, sympathy, impartial spectator

Propensity to truck, barter and exchange one thing for another


Division of labor



Theory of social justice?

Market economy


Market society



We already stated that Smith assumption of a “propensity to truck, barter and exchange one thing for another” is not only questionable, but it also loses its relevance if the market functions. The division of labor and the “invisible hand” of the market are the main ingredients of a commercial society. What Adam Smith did not see or expect, however, is that the principle of the commercial society tends to invade parts of our society which are, prima vista, not considered within the domain of the economy. The resulting market society is characterized by competition and self-regulation in all aspects of life. Inasmuch as production is concerned, "self-regulation implies that all production is for sale on the market and that all incomes derive from such sales. …Nothing must be allowed to inhibit the formation of markets, nor must incomes be permitted to be formed otherwise than through sales." (Polanyi, 1968[1944], p.69).
Alternatively, Werner Sombart suggested the implementation of the capitalist model designed by Adam Smith will result in a division of labor within the enterprise, “especially as between the functions of ownership and management on the one hand, and those of carrying out orders on the other” (Parsons, 1928, p.647). In its mature phase, it will turn into the form of “Spätkapitalismus” which is dominated by “a ‘monster’, the capitalist enterprise, possessed of a purpose, an understanding, and a set of virtues of its own, going its own way independently of human will” (Parsons, 1928, p.651).


References

Anthony, Peter D. (1983), John Ruskin's Labour. A Study of Ruskin's Social Theory, Cambridge et al.: Cambridge University Press.

Binmore, Ken (1994), Playing Fair, Game Theory and the Social Contract, Volume I, Cambridge, Mass., and London: The MIT Press.

Binmore, Ken (1998), Just Playing, Game Theory and the Social Contract, Volume II, Cambridge, Mass., and London: The MIT Press.

Brewer, John (2005), “The return of the imperial hero”, New York Review of Books 52 (November 3), pp.55-58.

Darwall, Stephen (1999), “Sympathetic liberalism: Recent work on Adam Smith,” Philosophy and Public Affairs 28, pp.140-163.

Holler, Manfred J. (1982), "Models in natural and social sciences", Journal of Mind and Behavior 3, 1982, pp.43-53.

Holler, Manfred J. (1986), "Moral sentiments and self-interest reconsidered", in: A. Diekmann and P. Mitter (eds.), Paradoxical Effects and Social Behaviour: Essays in Honor of Anatol Rapaport, Vienna and Heidelberg: Physica-Verlag.

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Polanyi, Karl (1968[1944]), The Great Transformation: the Political and Economic Origin of Our Time, Boston: Beacon Press.

Rawls, John (1972), A Theory of Justice, London et al.: Oxford University Press.

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*Institute of SocioEconomics, IAW, University of Hamburg, Von-Melle-Park 5, D-20146 Hamburg, Facs: +49 40 428 38 6329. holler@econ.uni-hamburg.de. I would like to thank Matthew Braham, Leonidas Donskis, the participants of the Tartu conference, December 2005, and of the Salem College (Mass.) lecture, September 2005, for helpful comments.
[1]“The issue of resemblance is the hottest methodological issue in and about theoretical economics. Models and their assumptions are being criticised for being unrealistic and defended as sufficiently realistic or inconsequentially unrealistic….The traditional complaint is that the representatives do not sufficiently resemble what they represent, and that the gap between the two is ignored by treating the substitute systems as if they were the real system” (Mäki, 2005, p.309).
[2]"As we have no immediate experience of what other men feel, we can form no idea of the manner in which they are affected, but by conceiving what we ourselves should feel in the like situation." (Smith, 1982 [1759], p.9).
[3]This is perhaps the reason why Ken Binmore identified Adam Smith’s concept of sympathy with David Hume's notion (see Binmore, 1994, p.21 and pp.54ff.). He calls Smith as a pupil of Hume which, of course, suggests that their concepts of sympathy concur (Binmore, 1998, p.12). However, in this context, it seems more appropriate to consider Adam Smith a younger friend of Hume with the capacity of critique towards the older one.
[4]Here it seems that Smith (1982 [1759], p.13) borrows from the everyday notion of sympathy.
[5]Rawls (1972, p.263) assumes unanimity and the original position is defined such that unanimity is possible. As he observes, this condition “represents a constraint on arguments” and “shapes the content of the theory of justice, the principles that are to match our considered judgements”. Rawls can “afford” these constraints as his work is about the moral basis of society, and not about the conduct of individual people which is operational to Adam Smith (see above).
[6]The model could be constructed along the line of Binmore’s (1994, 1998) theory of justice which focuses on common standards of evaluation to solve social coordination problems. Binmore claims that evolution has provided us with the capacity of the original position "as an idealized representative of a class of equilibrium selection criteria washed up on the beach along with the human race by the forces of biological and social evolution". He continues: "Here is a tool supplied by Nature. Let us use it to improve our lives, just as we use whatever tools we find in our toolbox when making repairs around the house". Thus, "the plan is to widen the domain in which we make use of the device of the original position to coordinate our behavior" and also to fight the people who "pay lip service to the grand principles and
utopian aims of traditional moralists." (Quotations from Binmore (1998, p.9).)
[7]"This division of labour, from which so many advantages derived, is not originally the effect of any human wisdom, which foresees and intends that general opulence to which it gives occasion. It is the necessary, though very slow and gradual consequence of a certain propensity of human nature which has in view no such extensive utility; the propensity to truck, barter and exchange one thing for another" (Smith, 1981 [1776/77], p.25).
[8]Karl Polanyi (1968[1944], p.61) concludes that "individual acts of barter or exchange - this is the bare fact - do not, as a rule, lead to the establishment of markets in societies where other principles of economic behavior prevail."
[9]There is ample evidence for pre-history (see Schwedenspeicher at Stade, Northern Germany). However, in England, “by 1315 the countryside was full, busy and making money. Farming was becoming more sophisticated and trade-oriented, well-managed hay meadows produced a good flow of cash, and eight to ten million sheep supplied wool for the export trade alone” (Jones and Ereira, 2005, p.28). The duties of the villages towards the lords of the manor had often been replaced by money rents: nearly 90 per cent of the lords income were paid in cash. This rural market society was crushed by the great famine in 1315 and the Back Death of 1348. As labor became scarce, the lords threw the expensive peasants off their land and
replaced them with sheep. Again, trade became a phenomenon of periphery with moderate impact on everyday life.
[10]Polanyi (1968[1944], p.69) concludes that "Self-regulation implies that all production is for sale on the market and that all incomes derive from such sales." …"Nothing must be allowed to inhibit the formation of markets, nor must incomes be permitted to be formed otherwise than through sales."
[11]In his The Stones of Venice, Ruskin (2001[1851/53]) developed the relationship between “valuable labor” and the Gothic style. His starting point is a critique of the division of labor: “We have much studied and much perfected, of late, the great civilized invention of the division of labour: only we give it a false name. It is not, truly the division of labour that is divided; but the men – divided into mere segments of men – broken into small fragments and crumbs of life; so that all the little piece of intelligence that is left in a man is not enough to make a pin, or a nail, but exhausts itself in making the point of the pin or the head of the nail” (Quoted in Anthony, 1993, p.55). An alternative approach to labor is elaborated in his Unto This Last, subtitled Four Essays on the First Principles of Political Economy (Ruskin, 1970[1862]).
[12]Darwall (1999, p.162) argues that “for Smith, justice is not just a virtue of societies, but also, crucially, of individuals.” Since, for Smith, “a judgement of justice must be anchored in moral sentiments” Darwall (1999, p.162) there can only be social justice if there is justice on the individual level. However, there can be justice on the individual level and no valid concept of justice that holds for the corresponding society.
[13]The scheme of three books is somehow reflected in Smith’s Lectures on Jurisprudence.
[14]Modern thinkers, sometimes based on Adam Smith, point to the potential to derive a theory of justice from sympathy. John Rawls (1972, p.184) asks us to “consider the following definition reminiscent to Hume and Adam Smith. Something is right, a social system say, when an ideally rational and impartial spectator would approve of it from a general point of view should he possess all the relevant knowledge of the circumstances. A rightly ordered society is one meeting the approval of such an ideal observer.” As Rawls himself pointed out there are several problems with this definition.
[15]This injury will trigger widely shared resentment. “Resentment seems to have been given us by nature for defence, and for defence only. It is the safeguard of justice and the security of innocence” (Smith (1982 [1759, 1790]), p.79).
[16]To Adam Smith stability and protection against unexpectedness and surprise are positive values as such. In his manuscript, The History of Astronomy, which Joseph Black and James Hutton published post mortem he demonstrated that human beings are ill-prepared for experiencing surprises, especially when the object should be a reason for joy and pleasure. “…when the object is unexpected; the passion is then poured in all at once upon the heart, which is thrown, if it is a strong passion, into the most violent and convulsive emotions, such as sometimes cause immediate death; sometimes, by the suddenness of the extacy, so entirely disjoint the whole frame of imagination, but it never after returns to the former tone and composure, but falls either into a frenzy or habitual lunacy; and such as almost always occasion a momentary loss of reason, or of that attention to other things which our situation or our duty requires” (Smith, 1982, pp.34f ).
[17]See, e.g., the discussion in the Quarterly Journal of Economics 88, 1974, which almost immediately followed the publication of A Theory of Justice (Rawls, 1972).
[18]Here we make the rather plausible assumption that the sympathy we have towards j, based on j's position, depends on our own situation. As a consequence, ui'(sj) is valid for a given si.
[19]Verburg (2000, p.23) maintains that “the extent of Smith’s distributional concern is still being underestimated.”



Machiavelli, by Manfred J. Holler (University of Hamburg)
To be published by SAGE in the Encyclopedia of Power, edited by Keith Dowding.

It seems futile to say that political science would have developed quite differently over the past centuries, if the work of Niccolò Machiavelli (1469-1527) had not been ridiculed and besmirched and its author not demonized to the degree that he has been. I do not want to discuss why and how this happened. Instead I want to point out the essentials of the theory which he elaborated in his major political writings: The Prince, the Discourses on the First Ten Books of Titus Livius, and the History of Florence. I will also discuss two of his most prominent statements which invited outcry and refusal.
His most prominent statement is “the end justifies the means” (The Prince, p.94). This is not what he proposes or even worships, but the conclusion of his observation as we see from the following quote: “Let a prince therefore aim at conquering and maintaining the state, and the means will be judged honourable and praised by every one, for the vulgar is always taken by appearances and the issue of the event; and the world consists only of the vulgar, and the few who are not vulgar are isolated when the many have a rallying point in the prince.” In the Discourses (p.120) we can read “a wise mind will never censure any one for having employed any extraordinary means for the purpose of establishing a kingdom or constituting a republic. It is well that, when the act accuses him, the result should excuse.” Machiavelli is explicit that this argument only applies to forming or reforming the state. Moreover, he maintains that cruelties are cruelties, and cruelties have to be minimized. He fully accepts the Christian value system, but argues that in many cases peace and order can only be achieved through cruelty.
The second statement which became prominent is a question: “is it better to be loved more than feared, or feared more than loved” (The Prince, p.90). His answer: “… men love at their own free will, but fear at the will of the prince, and that a wise prince must rely on what is in his power and not what is in the power of others, and he must only contrive to avoid incurring hatred, as has been explained” (The Prince, p.91). There is nothing wrong with his answer; it describes a maximin solution. However, in general, maximin solutions are inefficient in variable-sum games; it seems that Machiavelli is quite aware of this and so he repeatedly proposes that the prince should seek the love of the people. It may prevent conspiracies from within and serve as a rampart to outside competitors (The Prince, pp.96 and 108), or in fact serve in both roles. “…those tyrants who have the masses for friends and the nobles for enemies are more secure in the possession of their power, because their despotism is sustained by a greater force than that of those who have the people for their enemies and the nobles for their friends” (Discourses, p.186). Machiavelli regards “as unfortunate those princes who, to assure their government to which the mass of the people is hostile, are obliged to resort to extraordinary measures; for he who has but a few enemies can easily make sure of them without great scandal, but he who has the masses hostile to him can never make sure of them, and the more cruelty he employs the feebler will his authority become; so that his best remedy is to try and secure the good will of the people” (Discourses, p.139).
The latter quote explicitly combines love of the people and cruelty. There is hardly any better illustration of this combination than the following episode that reports how Cesare Borgia, called the duke, made use of his minister Messer Remirro de Orco to gain power and to please the people. “When he [Cesare Borgia] took the Romagna, it had previously been governed by weak rulers, who had rather despoiled their subjects than governed them, and given them more cause for disunion than for union, so that the province was a prey to robbery, assaults, and every kind of disorder. He, therefore, judged it necessary to give them a good government in order to make them peaceful and obedient to his rule. For this purpose he appointed Messer Remirro de Orco, a cruel and able man, to whom he gave the fullest authority. This man, in a short time, was highly successful, whereupon the duke, not deeming such excessive authority expedient, lest it should become hateful, appointed a civil court of justice in the centre of the province under an excellent president, to which each city appointed its own advocate. And as he knew that the hardness of the past had engendered some amount of hatred, in order to purge the minds of the people and to win them over completely, he resolved to show that if any cruelty had taken place it was not by his orders, but through the harsh disposition of his minister. And having found the opportunity he had him cut in half and placed one morning in the public square at Cesena with a piece of wood and blood-stained knife by his side. The ferocity of this spectacle caused the people both satisfaction and amazement” (The Prince, p.55).
In this episode, the prince excels in strategic thinking. This is a characteristic feature of successful heroes in Machiavelli’s tales; and of course, it is a dominant feature of his own reasoning. It is not exaggerated to say that he introduced game theory into political reasoning and political theory. However, Machiavelli had a much grander project: the renaissance of the Roman Republic, as described in the Discourses, through unification of Italy which will bring peace and order to the people and protection against outside enemies. To reach this goal he is prepared to accept the tyranny of Cesare Borgia and, after his failure, a princely regime of the Medici. Just like in the history of Rome he expects that, in the end, the despot will be replaced by a republic. He also expects that the history will repeat itself. The republic will be followed by chaos and chaos will be followed by tyranny and tyranny, again, will be followed by the republic. To Machiavelli, this cycle is not a law of nature but the quintessence of his study of the past and the generalizing conclusions which he derived from it. It is a way of thinking about history and a justification to learn from it.
From the Discourses it is obvious that he prefers republic to monarchy or tyranny. Perhaps more surprisingly, he gave a series of arguments why he thinks that “the people are wiser and more constant than princes” (Discourses, p.214). No wonder that the kings of divine right and their vassals were keen to discredit Machiavelli. So far democratic writers and politicians did not try hard enough to revise this picture.


Machiavelli, Niccolò (1952), The Prince, New York: Mentor Books.
Machiavelli, Niccolò (1882), Discourses on the First Ten Books of Titus Livius, in: The Historical, Political, and Diplomatic Writings of Niccolò Machiavelli, translated from the Italian by Christian E. Detmold, in Four Volumes, Boston: Osgood.