Capturing Three Phases of Neoclassical Economics Through an Extended Concept of Consequentialism

How can the polymorphic object of economic neoclassicism be qualified? An original argument is put forward, which asserts that most of the normative and positive salient characteristics of neoclassical economics can be acknowledged as consequentialist. As consequentialism is the view that ‘certain normative properties depend only on consequences', the above argument rests on an extended version of consequentialism, which states that things matter through their consequences not only morally or normatively but also epistemologically and positively. Economic consequentialism may indeed be extended from (a) its Utilitarian base camp or its welfarist root to the following four other traits: (b) economic functionalism, which reduces social devices to their achievements, e.g., markets boiled down to the making of equilibrium, (c) optimising rationality, (d) invisible hand laissez-fairism and (e) methodological instrumentalism. Such an extension logically stems from the repetition of the pattern of ‘consequence valuation', i.e. (a) the best social alternative(s) lead to the greater satisfactions of preferences, as: (b) a functional institution leads to an ordered (and possibly optimal) social outcome; (c) the optimal individual decision leads to the preferred possible outcome; (d) self-interested behaviours lead to the public good; (e) a valuable assumption leads to an adequate prediction. These five traits thus form a coherent and comprehensive concept of economic consequentialism. The consequentialist nature of neoclassical economics is demonstrated via the differentiation between an ‘old' neoclassicism, a ‘new' one and a ‘contemporary' one.