Review of Claus Dierksmeier's: Reframing Economic Ethics. The Philosophical Foundations of Humanistic Management.

Enlightening Fundament for Economic Ethic

Claus Dierksmeier undertakes a long-term investigative journey through history in economic ethics. Surprisingly, he finds strong continuity from Aristotle via Thomas Aquinas to Adam Smith that economic activities in special and the economy as a whole were considered as means to serve an overarching goal such as the common good. Put in other words, ethics have always been the very foundation and source of legitimation for the economy and should, thus, be the fundament of economic and management theory, teaching and practice – different from today, where ethics is, at best, an add-on to „chrematistic“ economic and management studies or, at worst, considered as hindering to wealth creation and welfare achievement.

Dierksmeier calls for a readjustment in the relation of economics and ethics arguing that the three revisited giants – Aristotle, Thoma Aquinas and also, against wide-spread myth, Adam Smith (the “most-quoted and least-read economic thinker of all times”), would consider the separation of ethics from economics simply as „perverse“. Only after Smith, who was a professor of moral philosophy, the emerging economic science turned into the zombi discipline which it is still today in its mainstream: a positivistic, pseudo-objective would be-natural science with a broad hidden normative agenda that ranges from the caricature of the „homo oeconomicus“, the equalisation of rational choice with search for individual benefit and of individual benefit with financial gain on to the religious belief in endless and necessary GDP growth. All these implicit normative assumptions exert a strong influence not only on the mindsets of students of economics and current and future generations of managers and business leaders, but also on the decisions of policy-makers from the local to the global. In sum, they have an enormous impact on human liberty.

Contrary to the strategic (framing by) naming of “free markets”, “free trade” or “free enterprise”, this “one size fits all maximization paradigm” and its concomitant policies – from Washington Consensus over free trade agreements without linkage to human rights or planetary boundaries to unlimited inequality – is not only blatantly normative (against its self-misunderstanding and self-presentation as „value-free”), but it also limits the liberty of the many and can, thus, be considered as illiberal.

Dierksmeier, Claus (2016), published by Palgrave Macmillan, Springer Nature.
Dierksmeier, Claus (2016), published by Palgrave Macmillan, Springer Nature.

A special asset of the book is the further development of freedom theory overcoming the obsolete distinction between negative and positive freedom. Dierksmeier, who interprets and uses Immanuel Kant as a bridge-builder between the – equally valid – teleological and liberal paradigms, suggests a more useful distinction between quantiative and qualitative freedom. Whereas a quantitative idea of freedom regards freedom as a license or an asset (the more the better), qualitative freedom considers freedom a task (the better the more) linking it closely to virtue and ethics. The circle closes. En passant, Dierskmeier heals the unnecessary contradiction between freedom (falsely understood as independence from others) and responsibility (falsely understood as a burden) defining liberty as a human trait that flows out of virtuous and ethical attitude and that constitutes, together with the latter, our humanity: “Individual liberty and cosmopolitan responsibility, rightly understood, presuppose one another.”

Together with others, Dierksmeier develops a “humanistic management theory” in an international network. Together with other forces, such as the international initiative for pluralism in economics, these new insights are both solid and powerful enough to overcome the obsolete current mainstream paradigm of economics. I consider this slim but powerful book a must-read oeuvre for scholars of economic and business ethics, but it is equally enlightening for anyone searching for an economy that works for free and dignified humans and society as a whole on a healthy Planet.

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