Overcoming Positivism in Economics: Amartya Sen’s Project of Infusing Ethics into Economics

Abstract

Logical Positivism, which arose in philosophy early in the twentieth century, proclaimed the sharp distinction between facts and values. Despite objections at the time, positivism was imported into economics in the 1930s. Over time, objections lessened; economics was transformed and ethical considerations were driven out of its core. In the 1950s, debates about positivism arose within the discipline which had exported it. According to the American philosopher Hilary Putnam, the fact/value distinction is now discredited in philosophy. If that is so, the methodological foundations of contemporary economics are also discredited. This paper examines Amartya Sen’s moral science of economics. First, it presents his historical account of the connections between economics and ethics. Sen claims that there was a close connection between the two until positivism was imported. Second, it sketches some of Sen’s ethical objections to modern economics, which is still suffering from positivism. Finally, it lays out some of his ideas on how economics can be returned to an ethical path. Once the ground has been cleared of positivism, ethics can re-emerge in economics in various ways. One path has been marked out by Sen.