This installment of the early career research spotlight focuses on Peter Jaworski, who works in the field of business ethics. He is an Assistant Teaching Professor at Georgetown University, Senior Fellow with the Canadian Constitution Foundation, and a Director of the Institute for Liberal Studies. A lot of his recent work has focused on the question of how markets can be successfully and ethically used in our society. Good examples of his work are “In Defense of Commodification,” “Market Architecture: It’s the How, not the What,” and “Blame the Politicians: A Government Failure Approach to Political Ethics.” He is also author, with Jason Brennan, of the book Markets without Limits: Commercial Interests and Moral Virtues. Jaworski received his PhD from Bowling Green State University in 2012, and has since worked at the College of Wooster and as a Visiting Research Professor at Brown.
Nathan: Thanks for agreeing to this interview. You have used several articles to argue against anti-commodification. The gist of these arguments seems to be that while markets do have some negative effects, it is wrong to characterize them as necessarily amoral. What do you see as the defining features of markets, and in what contexts are those features made positive or negative?
Peter: This is the area that I hope to continue working in for the most part.
Let’s begin with the definition: I see an instance of a market exchange as a voluntary exchange of a good or service for valuable consideration. If you have many of these exchanges, then you have a market. By “voluntary,” by the way, I just mean that no person is directly making you do something you wouldn’t want to do but for the coercion. I don’t mean to exclude cases where you are made to do something you don’t want to do because you are poor or have no other alternatives. I think something counts as a market exchange when your poverty makes you, say, sell something of significant sentimental value to you, or makes you take an undesirable job. There’s no attempt to load the dice in the definition.
And the view that I have, and that I’ve written about with my colleague Jason Brennan, is that anything you may permissibly have, use, do, or exchange for free, you can permissibly exchange on a market. The view is essentially that markets do not add wrongness if it wasn’t already there to begin with. Slavery, for example, isn’t wrong because people exchange money for other people, it would be just as wrong if people made gifts of slaves to others. Communal sharing of a slave would be similarly wrong.
It’s also true, as an aside, that markets don’t make bad things good. So markets are morally neutral.
As for troubles with markets, I think they can incentivize bad behavior. So they can make bad things worse by giving people financial reasons to involve themselves in that behavior.
Nathan: The proper role of government with regard to business is a theme that also comes out in a number of your papers. What view do you hold regarding government regulation, and why?
Peter: I do write about this. With respect to government regulation, I think that, in principle, the government could do lots of things. So, for example, we have reason to endorse, in principle, the government’s role in correcting market failures, and getting involved in nudging us to make choices that are better for us than what we would ourselves pick. I don’t object to paternalism in principle.
But the conditions require us to idealize government agents as having no bad intentions, as having no private axes to grind, as being the kinds of people who sincerely want our good, and have superhuman abilities to realize their goals without unintended consequences.
In practice, I don’t think governments are filled with people like that. I think they’re filled with people like you and me. Actually, no, not like you and me. I think the kinds of people who are drawn to political office are probably more narcissistic and venal, on average, than others, and I think they’re probably more selfish and self-centered too. I have a rough recollection of some empirical evidence to support this guess, but I’d have to double-check. At any rate, watching the debates in the House of Commons on CPAC (the Canadian version of CSPAN), and listening to debates in Congress on C-SPAN radio (90.1 FM in the DC area) does not fill me with any sort of confidence in any of these people.
So in practice, if not in principle, we have to worry not just about market failure, but government failure too. We have to worry about rent-distributing behavior on the part of governments, and the potential for regulatory capture. And in practice we have to worry about giving self-important people the power of various offices which they can then use to act like Thrasymachus would and benefit their friends while hurting their enemies.
At any rate, my academic work isn’t focused on what I think should be the case in practice. For that, I’m happy to turn things over to the empiricists to test whether this or that intervention will result in the kinds of outcomes that we ought to want.
Nathan: You say that markets can incentivize bad behavior, and that governments can attract people who are more venal and narcissistic than average. Can you give some examples of how this works in practice? Also, while I understand you don’t want to decide policy, do you have any theories about how to protect against these tendencies (for example, do you think moral education would help, or a strong independent media)?
Peter: There are plenty of examples. On the market side, consider the lengths that Volkswagen went to try to dupe regulators. They created a system that would predict when a car was being driven by a consumer and when it was being tested by regulators, and the car would perform differently depending on who was using it. Clearly the desire to make money is a large part of the explanation for why VW acted so badly. Of course, the desire to be re-elected, or just elected in the first place, can have corrupting effects too.
I don’t think moral education is a solution to the problem, unless it offers practical advice about how to overcome our blind spots. Ethics professors don’t call their moms more often than average, and I hear that ethics books are stolen from libraries more often than other kinds of books. I suspect that most ordinary people are decent people, who want to do the right thing. Giving them information about when they are likely to make the wrong decision, and giving them suggestions about how to institute systems that avoid or overcome those pressures might help. That’s how I approach my teaching anyways.
Non-ordinary folks—the kinds who reach for political or high corporate office—might need threats precisely like a strong independent media. But I also like the approach of limiting their power in the first place. Both in the U.S. and Canada, we have systems of checks and balances, and we try to limit the power of any one office either with other offices that compete with them or with written or unwritten rules. Those are pretty effective (and both of our countries are great places to live, after all).
Nathan: I know some people who argue that markets are good, but capitalism (or the constant drive to get more wealth) is harmful. One of the ways this is formulated is as the theory of a steady state, or no growth, economy. What are your thoughts on this?
Peter: I like this question. I hope you don’t mind if I use it as a launching point to talk about work that I haven’t yet published, but that I’m working on just now.
Here’s my first tangent: I regard the definition of economic and political institutions or systems as requiring a description of the sets of policies that they institute. I think it a mistake to identify these institutions or systems with any object, aim, goal, or desire (or any other kind of mental state). So it would be a mistake to identify capitalism with a constant drive to get more wealth, just as it would be a mistake to identify socialism, say, with the goal of having equality, or alleviating poverty. Socialism just is the public ownership of the means of production, while capitalism just is the private ownership of the means of production (with property rights, rule of law, and some other things besides).
The reason why this is a mistake is because the link between a set of rules and any attitude or desire is contingent. It could turn out, for example, that socialism leads to inequality, or that capitalism leads to equality. To see whether or not they would or do requires empirical work, not moral argument. So it’s possible, at least, to say that you don’t approve of the constant drive to get more wealth because it is harmful, but then to request the empirical evidence about that and capitalism. It might turn out that there is no system that avoids this drive, or that alternative systems just transform a drive for more wealth into a drive for more of whatever will signal status. Maybe an alternative system for signaling status is better, but maybe it’s not.
Here’s tangent number two: I also think that we too often fail to see that moral arguments are rarely, if ever, alone sufficient to institute any particular economic or political system. Apart from moral arguments about what we are obligated not to do (like Nozick’s), there will always be a gap between what we ought to do, and the realization of that ought through any rule or set of rules. In work I haven’t published yet, I call this the ‘ought-state gap.’ We need bridge principles to get from moral obligations to some policy or set of policies. Usually, the bridge will consist in empirical facts. So, for example, we might want people not to smoke crack, but a law against it may not work. Similarly, we might have good grounds to want potential parents to be sufficiently informed and have sufficient resources, but even if so it doesn’t follow that a scheme of licensing parents will actually accomplish those goals. And so on.
As for the no growth economy, I don’t have strong views about it. I understand that Adam Smith thought that a free market will eventually lead to this, and others suggest interventions in order to get to it, but I’m unconvinced that it would happen, and I’m not sure it would be desirable. At any rate, we are so far away from this being desirable that I don’t spend a lot of time thinking about it. While it’s true that we’ve made a great deal of progress in alleviating poverty, and while it’s true that fewer and fewer people live on less than $1.35 or $2.00 per day, there are still so many people who live in poverty. We have seen reductions in obstacles to capital mobility, and in the freedom to move goods across borders. But we still confront significant obstacles to labor mobility, to the free movement of people across borders. That, to me, is a more immediate and more significant obstacle to alleviating poverty than anything else. Even supposing a steady state to be desirable, freeing up movement across borders is probably a necessary step along this path, and is, at any rate, more urgent and important than fixing people’s desire to want more stuff.
Nathan: Given your interest in business ethics, I’m assuming you’ve spent time teaching it. How do you organize your classes on business ethics? Are there any issues that seem to resonate more with students than others?
Peter: I do teach a great deal of business ethics. For my undergraduates, I mainly use a PPE-style model for business ethics — meaning that my classes are taught around classics drawn from philosophy, psychology, economics, and a little bit of political science. I introduce and discuss the shareholder, stakeholder, and the market failures approaches to business ethics; spend a great deal of time discussing moral blind spots, including the Milgram experiment and other psychological findings that suggest most bad business behavior is due to people overlooking ethics rather than actively trying to do the wrong thing; give them some resources to try to avoid this ‘ethical fading’; spend a few classes talking about “repugnant markets”; and then shift to a discussion of what employees are owed, and what we might owe the especially poor.
I use something I call ‘the business project’ as my evaluative tool throughout. Students get into groups, they invent a business (I leave it totally open to them, so they can decide to pursue an illegal business if they want), then they 1) pitch the idea to the rest of the class (like Shark Tank), 2) construct a statement of Corporate Social Responsibility, 3) either construct a marketing campaign or morally critique an existing marketing campaign by one of their competitors, and, finally, 4) I construct an ethical dilemma or ethical problem specific to each business and give them 48 hours to come up with a response that they present to the class.
Maybe because this is my primary research area, and maybe it’s because I’m most excited to talk to them about it, but the students get pretty excited to talk about repugnant markets. Some of the more interesting debates in my classes are about whether or not we should have a market in kidneys or surrogacy and how those markets might be structured or designed to avoid some of the more significant objections to them.
Nathan: Your student business project sounds exciting. What are a couple of your favorite student businesses, and what were some of the ethical dilemmas you presented them with?
Peter: There have been so many good ones!
I have a few standard template-like cases. So, for example, the snake oil dilemma: what do you do if it turns out that your product doesn’t actually work; or disparate impact: what do you do if it turns out that your service only employs males, say, or what do you do if your customers have racist preferences (even though you didn’t intend that outcome)?
One memorable business project was an electric bike company called Riide (sic). They exist now as a real company, and are doing pretty well. For them, I suggested that some people were modding (another word for modifying) their bikes to get more power out of the battery, which conflicted with some of the claims they made about the safety of their bicycle. They could either leave it alone (because the mod made their bike more attractive to consumers, and so they made more money as a consequence of this modding), or choose to use a different battery which was slightly worse, but could not be modded (and so they would lose money, but preserve the value they claimed to care about). They chose to leave it alone, arguing that it’s not their responsibility what others do with the product.
Some of the illegal companies are memorable too. One such company was called “Ray of Hope.” Their business was performing kidney transplants. But they also gave free check-ups in poor neighborhoods. The purpose of the free check-ups was to see if any of these folks were a good match for people waiting on a kidney transplant. If they were, they would approach them afterwards offering money for their kidney.
It was interesting to see them defend their business plan to the class. They insisted that while what they were doing was illegal, it was still the morally right thing to do. They tried to persuade the class that the lives they would save, plus the money they would deliver to poor people, was a win-win. To make things difficult for them, I had someone threaten them with publicizing the story unless they gave him a liver transplant. It was an interesting mix between someone who is vulnerable (he would be on their operating floor, after all, needing a liver transplant), while posing as a threat to their business. They opted to perform the transplant.
Often, I get apps. And often, those apps are like a “Craigslist for Georgetown” kind of app. One was called College Traffic. For their dilemma, I had them discover that students were selling study drugs to each other, using codenames like “Plinko.” I suggested that this is why their business was successful, and that other sales were not enough to keep the business afloat. What did they do? They decided to put in language saying that they opposed it, and some policies to try and eliminate the sale of these drugs, but they intentionally constructed policies with holes that would still permit this to go on. They were hoping that they would be covered from a legal point of view, while not actually doing anything that would eliminate the use of their app for illegal sales.
Please feel free to ask Peter questions about his work in the comment thread.
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