Steven Grosby has carefully argued for his idea about the significance of “disinterested interest” as one basis for understanding the motivation to be philanthropic. Motivation itself is one tough nut to crack, and it reminds me that the better part of all judgment that we have of others is by necessity—that is, through experience—rooted in our observations of their actions rather than the reasons they may give for them. Economic thinking, however much it is extended into other fields by the theory of rational choice, elides the difference between motivation and action, settling instead on judging results or outcomes as the principal measure of success. Such thinking has about it an air of triumphalism; after all, whatever counts as failure indicts motivation as a causal ingredient in a formula for action that would count generosity, for example, as “rational” only insofar as the provider does not give away so much that he or she becomes the one requiring provision. Read More...

Professor Steven Grosby’s interesting essay does not raise a new problem, but it does suggest a new—and provocative—way to address it. The problem, at bottom, is how to explain philanthropic behavior within the theory that human beings are self-interested, rational, utility maximizers. Grosby rightly indicates that, whatever else is true, human beings surely are notonly rational utility maximizers. They frequently, indeed routinely, sacrifice their own interests to serve the interests of others, and they also frequently “achieve satisfaction from acting in accord with what [they perceive] to be the right thing to do” even “at considerable cost [to themselves] while the benefit of the action accrues to another” (2009, 3). An example Grosby raises to illustrate his point is patriotism, especially in its ultimate expression: “Whatever the satisfaction derived by the individual in sacrificing his or her life, the benefit or return of this action accrues not to that individual but to the nation.”(2) Read More...

Scholars, particularly German ones, have written about an ages-old puzzle they call “Das Adam Smith Problem,” namely, how could the same person over several decades write The Wealth of Nations and The Theory of Moral Sentiments and revise them here and there, yet never reconcile “the contradiction”? Today, scholars no longer wrestle with how the same person could provide a strong case for self-interested action in one book and make an equally compelling case for other-regarding conduct in another book. Instead, we have a new Das Adam Smith Problem: how does the reconciliation take place? That debate continues, with obvious consequences for the future study of philanthropy. Read More...

In “Philanthropy and Human Action,” Steven Grosby succeeds in his effort to explain the coexistence of “self-interest and self-sacrifice” within the theory of rational choice. My question is whether his case for “an interest in acting disinterestedly” (what I will call an interested disinterestedness), as an amendment to the theory of rational choice, contributes substantially enough to our understanding of what mobilizes our care for others. Grosby clearly recognizes the shortcomings of rational choice theory in explaining what many self-conscious, sensitive, and discerning individuals describe as sacrificial, generous, or philanthropic human behavior. In order to capture such beneficent orientations of individuals, Grosby tends to speak of these orientations as “disinterestedness” and of the individuals and behaviors reflecting such orientations as “disinterested.” These terms work just fine for his purposes, which are (1) to contrast disinterestedness with self-interest, (2) to reconcile rational choice with his belief that altruistic orientations truly exist, and (3) to do this without abandoning the initial principle of rational choice theory, namely that self-interest remains the ultimate impetus for all behavior. Read More...

“[Dostoevsky’s] concern was always with what it is to be a human being—that is, how to be an actual person, someone whose life is informed by values and principles, instead of just an especially shrewd kind of self-preserving animal.”

—David Foster Wallace, Consider the Lobster

Paul Lewis has written a very interesting and wide-ranging paper. One of its concerns, and the one I will focus on here, is to enrich and flesh out Sen’s notion of commitment by using insights from recent philosophical work on collective intentionality and identity. The context, of course, is the application to philanthropic action, which Lewis sees, plausibly, as exemplary of Senian commitment. Read More...

People act philanthropically, Paul Lewis argues, because these actions serve to fix or express their identity. To make sense of this, he sketches a model of individual agency that has a two-tiered structure in which what is added to a conventional instrumental model of acting to achieve an end is, variously, a sense of commitment or an ability to switch into a mode of “we reasoning.” In both cases it is membership in a group that creates the possibility of this distinct second motivational tier. He also argues that Hayek’s defense of the classical liberal view of social/market order depends on such a model of agency (and the implicit possibility of philanthropic behaviors). Read More...

David Ellerman offers a nice paper on organization theory, one that combines Hirschman’s two logics (exit and commitment) with Simon’s work on organizations. He suggests that the size of the philanthropic sector in the United States is positively related to the size of the absentee-owned, profit-maximizing corporation. This is a novel hypothesis.

I agree with the bulk of his lengthy discussion of Hirschman and Simon (and the contrast between the theory of American firms versus J-firms), and this accounts for almost the entire paper. Those of us acquainted with the literature will find little that is new here. This makes it something of a challenge for me to find something to criticize. Read More...

In his essay on “Rethinking Philanthropy and Business,” David Ellerman makes it clear that he has little interest in the existing phenomenon that Bremner (1988), Payton (1988), Ealy (2009), McCully (2007) and others characterize as philanthropy. Ellerman’s presentation of philanthropy in this piece is idiosyncratic, endorsing in turn both a residual, “government failure” approach and a market failure approach to which he adds his own “philanthropic failure” approach which, he says, could be corrected by corporate reform. The result is a view of philanthropy and nonprofit activity, which he says is much the same thing, as epiphenomena whose existences are conditional on the failures and inadequacies of corporate business in enabling individuals to address collective concerns through their work life. In this way, Ellerman seeks to move philanthropy entirely off the map of human affairs. In its place, he offers a fairly concise definition of what others today call social enterprise. His distinct contribution here may well be his effort to give voice to a firmly anti-philanthropic view within the literature of philanthropy itself. For those whose primary interest (and engagement with this journal) is mediated not through a primary interest in “business (in some sense)” but through an interest in understanding philanthropy, it appears that the Ellerman “rethinking” presaged in the title is largely a matter of simple and complete dismissal. That business may—or in some reconfigured form, would—offer a socially responsible venue for collective action is one of a number of unexplored presuppositions in the paper. Read More...

Through a discussion of French thinkers Marcel Mauss and Serge-Christophe Kolm, Laurent Dobuzinskis’ thoughtful paper investigates what he calls the “philanthropic order,” a self-organizing order which originates in individuals’ gift-giving initiatives and creates complex webs of interdependence, obligation, and connectedness among people. Perhaps more familiarly known as the nonprofit sector or civil society, the spontaneously arising philanthropic order exists, as Dobuzinskis notes, “more or less precariously between the commercial sphere and the state” (2009, 116). Dobuzinskis defines the philanthropic order broadly, including not merely the activities of donors and foundations but also “a whole range of processes that allocate material and symbolic resources through nonmarket mechanisms fuelled by more or less explicitly altruistic motivations” (115). Although aware of possible tensions and conflict, Dobuzinskis nevertheless seems to understand the philanthropic order as an essential complement to the market order, insofar as it produces and reinforces the social capital upon which the market depends, by enabling individuals to interact with other individuals (friends, neighbors, and even strangers) in a manner independent of yet broadly beneficial to the economic order and perhaps to the political one as well. Read More...

The writers of many economics textbooks state the discipline’s subject matter as the study of what is produced for whom, and how. Curiously enough, they rarely complete the usual list of “wh-” questions to include when and why. This is symptomatic of the neglect by mainstream economics of time and people’s motivations. The neglect of time—and of demography, which until about 1911 was an integral part of every course in economics—has left economists, governments, and private citizens insufficiently prepared for dealing with the consequences of the aging of industrial societies. Ought the government to provide for our needs after we have stopped working for our income? In that case we have to decide how to redistribute the earnings and wealth that have been generated by the market, through taxation and transfer payments by the government. Or should the provision for old age be left up to private initiative? The latter is usually interpreted as meaning that every individual takes care of their own pension. But the sphere of private initiative does not stop here. Individuals may also decide to voluntarily transfer their wealth to others without expecting anything in exchange. This is the sphere of altruism and philanthropy, which also suffers from a lack of attention by economists. Read More...

I first wish to thank Lenore Ealy for the opportunity to comment briefly on Laurent Dobuzinskis’ stimulating paper. The author shows that most analysts, including Hayek, consider Mauss’s analysis, and the gift phenomenon in general, to apply primarily to archaic societies. “Gifts exist only at the margin of the market economy” (Dobuzinskis 2009, 119).

Furthermore, when it does apply to present-day societies, it is defined as disinterested, nonreciprocal, acts.

What the Maussian movement (MAUSS, an acronym for Mouvement anti-utilitariste dans les sciences sociales)¹ first attempted to show is that Mauss’s vision of the gift very much applies to modern society. This is the main thesis in our book, The World of the Gift, first published in French in 1992. The gift here is an order that is both spontaneous and modern. (I prefer “gift” to “philanthropic” order. Philanthropy is simply one type within the “gift order.”) The market order itself rests in part on this order, if only because the gift feeds trust, a necessary ingredient of the Hayekian catallaxy (Dobuzinskis 2009, 122). This is why we don’t think of the gift as first and foremost an economic order, although its economic dimension is important and increasingly so in an information economy with phenomena such as open source and “copyleft” (124). The gift is not only a gift economy (130), and the gift and economic orders are not always, and not necessarily, antagonistic. Let me try to briefly develop these points. Read More...