Money and Markets: Essays in Honor of Leland B. Yeager

Leland Yeager’s utilitarianism as a guide to public policy 219rights. I am unwilling to deviate from this rights principle on utilitarian grounds inparticular cases, for reasons that Yeager and Hayek have articulated well. In asocial setting I understand that I am not a dictator and that other people have thesame rights I do. Thus, I am reluctantly willing to allow them to trade their rightsaway to try to further goals that they believe will enhance their happiness. This doesnot imply my agreement. Even while recognizing people’s right to voluntarily giveup their rights, I will still argue that they should not, based on my indirect utilitarianview of rights. 10The subject matter of this paper is normative, and I believe that most of thedifferences I have with Yeager on its topic are mostly rhetorical. Yet I am concernedthat Yeager’s position does not adequately safeguard individual rights – a goal Iknow he shares with me. Yeager’s utilitarianism appears so broad that one mightargue for almost any public policy based on the conclusion that it would furtherhuman happiness. Of course people could argue the other way based on the effectsof the policies, but then the argument becomes positive, and the normativesuperstructure Yeager has built has little impact.These, then, are my reactions to Leland’s ideas. I close by reaffirming the manyinsights on this topic that I have picked up from Leland, by acknowledging that heis far more an expert on the subject than I, and in this paper in honor of LelandYeager’s 80th birthday, wishing him a happy birthday!Notes1 See McCloskey (1983, 1985), however, who argues that not only do economists not carryout their work in the positive way they describe it, but that economic research is betterbecause it deviates from that positive methodology.2 Positive analysis might also find some beneficial effects from rent controls, such askeeping elderly widows from being evicted from their domiciles due to rising rents, butAlchian and Allen do not mention any results of rent controls that might be consideredbeneficial in their analysis, so their positive analysis points uniformly in one direction.3 Hayek popularized this phrase, which he quoted from eighteenth-century philosopherAdam Ferguson. See Hayek (1948) for his ideas on the subject.4 A similar statement, although not quite as strongly-worded, appears in Yeager (2001:234).5 See Yeager (1994) for his reaction to my book.6 Yeager puts Nozick (1974) and Machan (1975) in this group of rights theorists withimplicitly utilitarian foundations.7 See Holcombe (1994: 186–7) for a further discussion of the similarities betweenutilitarians and contractarians.8 Actually, in Yeager’s example based on Mirrlees’ work, the transfer is so large that itleaves more productive individuals with less income than less productive individuals, butMirrlees (1971) argues that an actual welfare-maximizing tax system would haverelatively flat rates and would give productive people more total income, retaining theincentive to be productive.9 However, I do believe that there are certain inalienable rights, and that people shouldnot be allowed to sell themselves into slavery, for example. If rights begin with the rightto self-ownership, people must retain self-ownership in order to preserve this basis forrights. But exploring this caveat further would take the present argument too far afield.10 The only case in which I would argue for giving up some rights is to help to further