From the Times Literary Supplement:
Critical Review will shortly enter its twelfth year. It began
as a "classical liberal" journal with libertarian leanings. Edited from
Yale by Jeffrey Friedman, it boasts some big names (eg, Buchanan, Sen)
on its advisory board, and also among its contributors. It describes
itself as "an interdisciplinary quarterly that devotes special attention
to understanding the nature, politics and history of modern states and
societies, especially to help evaluate their effects on human well-being".
Each number contains a symposium on some central theme or thinker. Of
the three issues in front of me the most recent (which actually dates
from the beginning of this year) is devoted to F.A. Hayek, the one previous
to Tibor Scitovsky's The Joyless Economy (twenty years on) and
the one before that to "Critics of Capitalism".
The last mentioned features three set-piece confrontations on market
socialism between David Ramsay Steele (against) and an ex-Marxist, David
Schweikart (for); on Keynes's contention that capitalism is not self-correcting,
between Steven Horwitz (who disagrees) and Greg Hill (who agrees); and
the third, between Liah Greenfeld (who thinks nationalism gave rise
to capitalism) and two radical historians, Warren Breckmann and Lars
Tradagrdh (who think the reverse). One notes that, Hill excepted, the
Left's late reverses have not improved their intellectual manners, the
reason evidently being that they still cannot believe in their opponents'
The Scitovsky issue is uneven but interesting. Contrary to classical
liberalism Scitovsky concluded that consumers are not necessarily the
best judges of their own long-term interests. Modern capitalism's ability
to satisfy every passing whim leads to comfort, monotony, boredom and
a craving for unnatural and destructive forms of stimulation. The only
answer says Scitovsky is "culture", which propels us towards pursuits
which are difficult, demanding and creative. But how many in a liberal
society will choose that in preference to easy, mindless distraction?
The most striking contribution here is by Michael Benedikt, an architect
and architectural theorist who is also a dab hand at complex welfare
calculations. At the core of his graph festooned, but also eloquent
and literate, argument is the idea that the vileness of the average
American townscape is the outcome of the obsession with freedom, which
has left us, he says rather movingly, with "no patience for trappings,
for what lasts, closes options, speaks softly, or means too deeply".
There is also a splendid retrospect by Scitovsky. His reply to his
critics is a masterpiece of Lifemanship, first cheerfully agreeing with
them all and then suggesting that they have not gone far enough. He
concludes with some uncompromising paragraphs on child rearing, commending
rewards and (yes) punishments for their indispensable role in producing
upright, useful and civilized human beings
Finally, the Hayek number. Most of it is highly critical. Hayek is
championed though by Peter Boettke, who defends him as a dynamic, real-world
economist rather than (like his opponents) a mere mathematical modeller
and by Ryszard Legutko, who defends him as a political thinker. Legutko
teaches at Cracow University (where I heard him ten years ago), and
anyone who thinks Hayek is a spent force would do well to visit Poland
or the Czech Republic. What is true is that Hayek is no longer a novelty,
and that many of his teachings, in particular that concerning the vital
epistemic function of markets (which makes them incomparably superior,
for the satisfaction of most human wants and needs, to dirigisme),
are so taken for granted, even among socialists, as nowadays to be virtually
What socialists like Steven Lukes (featured here) do take issue with
is Hayek's assault on so called "social justice". Certainly, whatever
markets reward, it is not straightforward moral desert. (This poses,
as Hayek saw, a serious legitimation problem.) But does that make them
unjust? If they could be made to reward it, would they still function
properly? Would they if their product were (as at present) significantly
redistributed outside the market? What kind of distribution would be
These questions are all familiar, but I cannot see that Lukes really
addresses them. He never tells us what "social justice" is. For David
Johnston, on the other hand, social justice is "substanlive equality"
of reward (irrespective of desert?) But as Johnston admits, it can only
be directly secured by massive inequalities in power, which are even
worse than material inequalities. So the only hope lies in as yet unknown
"strategies of indirection".
Johnston is nevertheless excellent on Hayek's distinction between organized
and spontaneous orders, and notes their paradoxical interdependence.
In a searching piece, Gus diZerega notes that spontaneous orders (particularly
the market) may have externalities which, despite claims to the contrary,
make them far from "value-neutral". "Precisely because it is
not the outcome of deliberate decisions", he writes of the market order
(which he distinguishes from the market place), "it cannot simply
be assumed to reflect people's desires faithfully." If we could foresee
the collective outcome of our choices, we might choose differently.
Juliet Williams finds Hayek's defence of law wanting, since, though
law, being predictable, is generically preferable to arbitrary rule,
he neglects to distinguish just from unjust laws. A point, strangely,
which nobody makes is that riproaring capitalism can be as unpredictable
as arbitrary rule, and thus equally makes nonsense of people's attempts
to provide for the future.
Critical Review gives so much space to liberalism's critics
that its original allegiance is barely detectable. It is, in short,
impressively and scrupulously self-critical. But that, of course,
merely vindicates liberalism's own claim that its errors, like capitalism's,
are self-correcting, though one might query whether what remains is
--R. A. D. GRANT
From the Wilson Quarterly:
ECONOMICS, LABOR & BUSINESS
What Do Consumers Really Want?
A Survey of Recent Articles
A little more than two decades ago, an economist named Tibor Scitovsky
challenged a basic assumption of modern economics: "that the consumer
is rational ... that whatever he does must be the best thing for him
to do, given his tastes, market opportunities, and circumstances, since
otherwise he would not have done it." It was "unscientific" to make
this assumption. Scitovsky argued, and sustained observation of human
behavior showed that it was frequently unjustified: people often fail
to choose what is best for them. They watch too much television, for
instance, rather than reading great literature.
Scitovsky's book, The Joyless Economy (1976), received scant
recognition when it first appeared, but some now are hailing it as a
prophetic masterpiece. It is among "The Hundred Most Influential Books
Since World War II," according to a survey of prominent scholars by
the Times Literary Supplement (Oct. 6, l996). More recently,
in Critical Review (Fall 1996), seven sympathetic critics and
Scitovsky himself revisited the book's critique of consumer capitalism.
"Drawing on research in physiological psychology," Scitovsky began
with the human inclination to avoid discomfort and seek pleasure, note
Jeffrey Friedman and Adam McCabe, Critical Review's editor and
research assistant, respectively. But he contested the notion that the
dynamic is so simple. "In Scitovsky's view, there are two sources of
displeasure: not only too much stimulus--pain, but too little--boredom."
Affluent societies had produced widespread comfort--but too much
comfort resulted in ennui. By seeking excessive comfort rather than
stimulation, or by turning to such fleetingly satisfying types of stimulation
as TV or shopping, people made "wrong" choices and got less enjoyment
than they could out of life. "The remedy," Scitovsky said, "is culture"
and the stimulation provided by music, painting, literature, and history.
Consumers must be educated to make wiser choices.
Friedman and McCabe note "the paternalistic implications" of Scitovsky's
work. If freedom has great intrinsic value, they say, "it is difficult
to see why we should be concerned with Scitovsky's, or anyone else's,
empirical findings about freedom's potentially unhappy effects." Unfortunately;
they add, the conviction of freedom's intrinsic value "drains any urgency
from the investigation of how we should live; indeed, it taints such
investigation as suspect, because [it] might lead to 'elitist' conclusions."
Unsurprisingly, "such investigation is rare, and . . . Scitovsky's example
is a lonely one."
But Amartya Sen, a professor of economics and philosophy at Harvard
University, denies that Scitovsky's book is "paternalistic in spirit."
Rather, he says, his diagnosis has some affinities with "[the] Socratic
claim that the 'unexamined life' is not worth living. If constructive
stimulation is neglected in actual behavior, this is not because people
have examined the alternatives and the range of choices that are in
fact within their command, and have come to the considered conclusion
that they really do want comfort rather than stimulation. Had that been
the case, it would have been harder for Scitovsky to press stimulation
on them, 'in their own best interest.'"
Juliet Schor, author of The Overworked American (1992) and a
professor of the economics of leisure at Tilburg University, in the
Netherlands, credits The Joyless Economy with pointing out the
yawning gap between consumption and satisfaction. However, the solution,
she believes, does not lie in better educated consumers but in a movement
away from "consumerism" toward a different "system" with less private
consumption and more "public goods, savings, leisure time, and environmental
Albert O. Hirschman, a professor of social science, emeritus, at the
Institute for Advanced Study, Princeton, New Jersey, also faults Scitovsky
for "his utter neglect" of the public sphere -- of politics, participation
in public life, and pursuit of the public interest -- as a welcome source
of stimulation. Sometimes, Hirschman points out, public and private
stimulations can be had at the same time. In ancient Greece, for example,
banquets that originated in the religious sacrifice of a bull or ox
not only offered the private pleasure of food but played a part in the
emergence of Athenian democracy.
Scitovsky--whose academic career included stops at Stanford University,
the University of California campuses at Berkeley and Santa Cruz, and
Yale University--says in Critical Review that the criticisms
of his book's narrow focus on the private domain are justified. "I dealt
only with the desire for status, the comfort of belonging, and the stimulus
of conversation in pubs and cafes, but was remiss in overlooking all
the pleasure and stimulation provided by many public goods and activities,
ranging from beautiful landscapes and cityscapes to one's public activities
and duties as a citizen." These, too, have value, yet are slighted in
the usual economic calculus.
Michael Benedikt, a professor of architecture at the University of
Texas at Austin, criticizes Scitovsky on another front, arguing that
his "simple dichotomy" of comfort and stimulation doesn't lead very
far. What's needed, he says, is a hierarchy of human needs that would
allow evaluation of the true "utility" of different things. Benedikt
proposes six categories, from the need for survival to the need for
But Scitovsky gets the last word. A now-glaring shortcoming of his
Joyless Economy, he says, is that it focuses on the problems
of the affluent while neglecting those of the poor. They too--in addition
to their more obvious privations--"suffer from boredom, just like the
idle rich." But the boredom of the poor "is chronic, which makes it
a deprivation as extreme as starvation, and with equally fatal consequences
. . . violence and vandalism." Work, Scitovsky suggests, is "the main
antidote to boredom for the majority of mankind," and one of our deepest