I don't know. I do think that without virtue there can be no value, if these are properly defined. (Virtue corresponding to filling human needs, value being economic value.)
Is entertaining people virtuous at least potentially? if so, then there is nothing wrong with selling video games, movies, music, or whatever. If not, however then you have a problem because while the world make seem nice on paper (no money to Hollywood since that would take away from cancer research), it isn't a world any of us would like to live in.
The problem is from where I sit that the expected value (what investors will put in things) is wildly out of proportion to the actual delivered value to customers. I think this is even true of giants like Facebook, so what we get are speculative bubbles because investors are assuming there is more value than there is.
> I do think that without virtue there can be no value, if these are properly defined.
This is an unproductive line of argument because either of us can just keep moving the goalposts until we're exhausted.
Economic value clearly doesn't follow any "gut" virtue. Here's how an early moral theorist put it in a notoriously influential book:
I returned, and saw under the sun,
that the race is not to the swift,
nor the battle to the strong,
neither yet bread to the wise,
nor yet riches to men of understanding,
nor yet favour to men of skill;
but time and chance happeneth to them all.
Generally speaking, attempts to create ranking functions for virtue lead to mismatches with the observed state of the world. You line up the list of virtuous things (curing AIDS, feeding poor people) and the list of valuable things (Ruby on Rails programmers, inanimate chunks of metal) and discover that they just don't line up. At all.
But if you try to impose a virtuous order, it all goes kerflooie. Because the whole system of production and allocation relies entirely on value. When you take value you away, it stops working. Partial enforcement leads to partial derangement and in general, creates new evils, requiring still further ranking functions ... it spirals out of control thereafter.
We read this:
Dear friend, it is not possible for man to avert that
which God has decreed shall happen. No one believes
warnings, however true. Many of us Persians know our
danger, but we are constrained by necessity to do
as our leader bids us.
Verily 'tis the sorest of all human ills, to abound in
knowledge and yet have no power over action.
And imagine ourselves to be men and women both of knowledge and power. But it was always an illusion.
I'm doing a pretty poor job of explaining all this. Hayek's Social or 'Distributive' Justice does a much more convincing, thorough and erudite job. It was published in the second volume of Law, Legislation and Liberty, also in The Essence of Hayek.
edit: by the way, your blog about LedgerSMB and PostgreSQL is bloody marvellous.
You say this because we practically live in a post scarcity society. 500+ years ago people valued hard labor that brought food because food prevented starvation a vary real and horrible thing. Now, food is an evil that brings heart disease and obesity. Our desires for food and our well being are out of alignment. Value is now a function of are desires with little connection to our needs.
Stealing from people was never thought of as a productive economic activity, but legally things like patent trolls that act like stealing are legal. So, I suspect you could creat a society where virtue and value are at least aligned and historically they may have been closer. However, we don't live in such a place.
I think the evidence is that value and virtue have never correlated very well, scarcity or not. Hence quotations from two of the oldest books on the planet. Value and virtue are not orthogonal either, but it's messy.
In post scarcity society things would be completely different, as the market value pretty much loses its meaning when everything you want to buy is free.
You line up the list of virtuous things (curing AIDS, feeding poor people) and the list of valuable things (Ruby on Rails programmers, inanimate chunks of metal) and discover that they just don't line up. At all.
Ruby on Rails developers are scarce and valuable just because there still aren't a whole lot of them, and because they can crank out CRUD apps (which are just data collection apparatuses) more quickly and efficiently than anyone has been able to before. Once someone invents an even faster/more automated way to design and deploy a data-collection tool than RoR (which might be just a future version of RoR), then that will be the next big thing for a while.
Hmmm this is a very difficult topic to really do justice to. I don't think that Hayek is necessarily contrary to anything I am saying. The problem though is a definition of virtue.
> You line up the list of virtuous things (curing AIDS, feeding poor people) and the list of valuable things (Ruby on Rails programmers, inanimate chunks of metal) and discover that they just don't line up. At all.
But the problem here is that without a framework for deciding what is virtuous, all you are doing is assigning your own measure of value. In that regard your argument boils down to "what you think is valuable is not necessarily a solution that lots of people will pay money for." But I do think that virtuous solutions are valuable to the extent they are virtuous. A cure for cancer would be worth, I would expect, thousands or millions of times what a hollywood blockbuster would be.
However there are limits to this analysis. While I think valuable = virtuous with regard to solutions it doesn't necessarily follow that the coal miner is less virtuous than the Ruby programmer. Wages are determined in ways that both do and don't resemble market economics as even Adam Smith noted (he saw wage levels as being indicative of negotiating power differences between various professions).
So my caution is to avoid looking at wages (ruby programmers vs coal miners) in the same way you look at solutions (cure for cancer vs the next big MTV hit).
From memory, Hayek also mentions the problem of coming up with the ranking function for virtue. Basically "virtue" here is standing in as an alliterative reference to systems of ethics, morality, justice and justness etc etc. Huge fields of human thought in their own right. That sometimes value and virtue align is inevitable, simply because there's so many combinations available to test.
His general point is that trying to make complex, emergent systems fit into neat theories tends to break the systems.
That book I mentioned -- Essence of Hayek -- is worth getting. I began to review it on my blog and never finished writing my follow up ditties.
FWIW what I understand Hayek as discussing is something different, which is that centrally imposed definitions of "good" have very little to do with local decisions that people make. Hayek is arguing, as I read him, against the idea that "social good" as we culturally construct it through centralized structures (church and state) is the goal of the economy.
There is a way out of this, and that is a 19th century Catholic idea (I am not even a Christian but Catholicism is interesting to me to the extent the Catholic Church is a torchbearer for pagan Greek and Roman phylosophy) called "subsidiarity."
The idea of subsidiarity is that it is theft for a group to accomplish what an individual could accomplish by him or herself, and for the same reason it is theft for a larger, more centralized group to do what a smaller group could do. The goal of larger groups should be to support, not supplant, smaller organizations. This idea of subsidiarity thus seeks to reformulate society and the economy on Aristotelian grounds, with the family household in the center (rather than the multinational corporation of liberal capitalism, or the state). From this view, virtue and economic value are the same to the extent that people seek to live just lives, and to the extent that central authorities only seek to accomplish on their own what are fundamentally impossible for the smaller entities.
I think this is one reason why libertarians have associated the Catholic idea of subsidiarity with the private sector which only makes sense in terms of Hayek (I don't think that equivalence quite works but one can easily see the similarity).
I don't know if Hayek would be on board with it. The main problem is that it introduces a new criterion for arranging production which doesn't emerge from the existing order.
Hayek isn't trying to build the Ideal World. He's taking the world he saw and said "here's how it works", and then, "here's why it wouldn't work if we decided to design a system instead of having it emerge".
So for example, if subsidiarity is imposed, how does that play out? You already create a requirement to deduce what the smallest group capable of producing a thing is. But we already have something like that in the market. It's lumpy and fuzzy, but it does eventually kill off the too large and the too small (modulo endless tinkering by legislators).
Coase explained that firms emerge because of transaction costs. Sometimes it's easier and cheaper to do a thing in existing groups. Sometimes it's not. The tension between these allows firms to emerge from the social order. I'd add that the rise of IT has enabled coordination on a vastly greater scale, which has helped to create the modern corporation.
The point of subsidiarity though is that it puts central authorities in the position of midwifery for having such a world emerge rather than in the position of architecting, designing, and building it.
The problem though is that these are huge fields of thought and also that the very contentious. Ethics for example is usually defined to be asking the question of "what is good?" Obviously defining "what is good" is an undertaking which leads different people in different directions.
I take the approach of saying "what is good is what is conducive to human flourishing." This is largely an Aristotelian approach (and so you can't really accuse me of deriving terms to meet economics). Therefore I would say there is some virtue in entertaining people or rather that such is at least potentially virtuous.
The problem is that if you accept that human flourishing is the goal and thus the definition of virtue, and if you assume that to a large extent this is also the goal of the economy (something I think that both most economists and the Classical philosophers shared), then virtue and value can't be seen as separate at least in terms of solutions (as I say, wages are different).
Or are you saying that Hayek does not see distributive human flourishing as the ends to which our economic systems work?
Is entertaining people virtuous at least potentially? if so, then there is nothing wrong with selling video games, movies, music, or whatever. If not, however then you have a problem because while the world make seem nice on paper (no money to Hollywood since that would take away from cancer research), it isn't a world any of us would like to live in.
The problem is from where I sit that the expected value (what investors will put in things) is wildly out of proportion to the actual delivered value to customers. I think this is even true of giants like Facebook, so what we get are speculative bubbles because investors are assuming there is more value than there is.