Mark Sagoff

In this paper I criticize what many economists recommend: namely, that land use regulations should simulate what markets would do were all resources fully owned and freely exchanged. I argue that this “efficiency” approach, even if balanced with equity considerations, will result in commercial sprawl, an environment that consumers pay for, but one that appalls ethical judgment and aesthetic taste. I showthat economic strategies intended to avoid this result are inadequate, and conclude that ethical and aesthetic as well as economic principles are needed to guide policies governing the use of land.

ABSTRACT In this essay, I argue that large‐scale technologies may be more threatening to open democratic institutions than to ecological systems. I describe the threat in terms of an alliance between bureacrats and entrepreneurs to govern society according to their own methods, e.g., cost‐benefit analysis, and thus to usurp the rule of law. In America, though not in England, blue‐collar and environmentalist constituencies have on occasion beaten back this threat, a triumph of democracy. I use ‘grid‐group’ theory, as developed by Mary Douglas and her students, to make these arguments about the relation between technology and democracy.

Four dogmas have shaped modern neoclassical economics. The first proposes that markets may fail to allocate resources efficiently, that is, to those willing to pay the most for them. The second asserts that choices, particularly within markets, reveal preferences. The third is the assumption that people always make the choices they expect will benefit them or enhance their welfare. The fourth dogma holds that perfectly competitive markets will allocate resources to their most beneficial uses. This is the doctrine of the invisible hand. I argue that these dogmas of applied welfare economics should be abandoned. One consequence of doing so will be an increased interest in the institutional context of production. A second will be a turn toward empiricism

Many consumers view genetically engineered foods with suspicion partly because the food industry has taught them to do so. Consumers learn from advertisements and labels that the foods they buy are all natural only to realize that that is not the case. The food industry wishes to embrace the efficiencies offered by advances in genetic engineering, but this technology belies the image of nature to which the food industry constantly and conspicuously appeals. Consumers who believe genetically modified foods are not “natural” will regard them as risky and undesirable.

This paper describes two frameworks—utilitarian and Kantian—society uses to make decisions concerning environmental management and, in particular, species protection. The utilitarian framework emphasizes the consequences of choices for prior preferences. A perfectly competitive market, on this model, correctly values environmental resources. The Kantian approach identifies rules appropriate to recognized situations given the identity of the decision maker. It relies on democratic political processes and institutions to provide the means by which citizens determine the identity of their community—its moral character and aspirations—and match appropriate rules to recognized situations. This paper argues that markets do not fail in any general way in measuring the economic value of plants and animals. Market prices, in general, correctly represent the marginal or exchange value of species. If society legislates against extinction, this must be understood as an exercise in Kantian decision making in view of the moral value of species, not as an attempt to “correct” a market failure or to promote social welfare or utility.