Tuesday, September 30, 2008

The Nanny State

Quite revealing article by Professor Deepak Lal writes in today’s Business Standard that the “economists have found many anomalies in the standard economic model of an individual’s maximising utility……current consumption depends on past consumption but not future consumption. This omission is repaired in the rational addiction models of Becker and Murphy (Journal of Political Economy, 1988). They show how even with inter-temporally inconsistent preferences, consumers maximise utility over their life cycle taking account of the future consequences of their actions in consuming addictive substances.

Nevertheless, Prof Sen always try to make mockery this one is no surprise for me. Prof Lal further writes “this is justified by moral paternalists by basing themselves on Mill’s correct argument against a person’s freedom to sell himself into slavery, namely that “the principle of freedom cannot require that the person be free not to be free. It is not freedom to be allowed to alienate his freedom” (On Liberty, Everyman edition, p. 158). Amartya Sen (FT, 11 Feb, 2007) has claimed the smoking ban in the UK is based on Mill’s principles of liberty: “as habit-forming behaviour today restricts the freedom of the same person in the future”. But as I and others pointed out, this is a complete travesty of Mill’s argument against slavery (FT, 15 Feb 2007, and especially S Simpson, FT, 2 March 2007). Mill’s robust arguments against bans on addictive substances like alcohol and opium do not mention his argument against slavery as being relevant in any way”.


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