IDEAS home Printed from https://ideas.repec.org/p/hhs/gunwpe/0292.html
   My bibliography  Save this paper

A Model of Dynamic Balance among the Three Spheres of Society – Markets, Governments, and Communities – Applied to Understanding the Relative Importance of Social Capital and Social Goods

Author

Listed:
  • Wicks, Rick

    (Department of Economics, School of Business, Economics and Law, Göteborg University)

Abstract

This paper revisits old questions of the proper subject and bounds of economics: Does economics study “provisioning”? or markets? or a method of reasoning, self-interested rational optimization? A variety of scholars and others in many fields make use of a taxonomy of society consisting of three “spheres”: markets, governments, and communities. It is argued here that this tripartite taxonomy of society is fundamental and exhaustive. A variety of ways of understanding this taxonomy are explored, especially Fiske’s (1991, 2004) Relational Models theory. Then – after communities and their products, social goods, are defined more thoroughly – a visual model of interactions among the three spheres is presented. The model is first used briefly to understand the historical development of markets. The model is then applied to understanding how economic thinking and market ideology, including the notion of social capital, can be destructive of communities and their production of social goods (and their production of social capital as well). It’s not possible to measure these effects monetarily, so calculating precisely “how this affects results” in a standard economic model is impossible. Nevertheless we could better prepare students for real-world analysis, and better serve our clients, including the public, if – whenever relevant, such as in textbook introductions and in benefit/cost analyses – we made them aware of the limitations of economic analysis with respect to communities and social goods. The three-spheres model offered here, based on Fiske’s Relational Models theory, facilitates this awareness.

Suggested Citation

  • Wicks, Rick, 2008. "A Model of Dynamic Balance among the Three Spheres of Society – Markets, Governments, and Communities – Applied to Understanding the Relative Importance of Social Capital and Social Goods," Working Papers in Economics 292, University of Gothenburg, Department of Economics, revised 01 Jan 2009.
    • Handle: RePEc:hhs:gunwpe:0292
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/2077/9680
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Hillinger, Claude, 2008. "Science and Ideology in Economic, Political and Social Thought," Economics - The Open-Access, Open-Assessment E-Journal (2007-2020), Kiel Institute for the World Economy (IfW Kiel), vol. 2, pages 1-70.
    2. Smith, Adam, 1759. "The Theory of Moral Sentiments," History of Economic Thought Books, McMaster University Archive for the History of Economic Thought, number smith1759.
    3. Robert H. Frank & Thomas Gilovich & Dennis T. Regan, 1993. "Does Studying Economics Inhibit Cooperation?," Journal of Economic Perspectives, American Economic Association, vol. 7(2), pages 159-171, Spring.
    4. Dolfsma, W.A. & Finch, J. & McMaster, R., 2004. "Market and Society: How do they relate, and contribute to welfare?," ERIM Report Series Research in Management ERS-2004-105-ORG, Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus University Rotterdam.
    5. Konow, James & Earley, Joseph, 2008. "The Hedonistic Paradox: Is homo economicus happier," Journal of Public Economics, Elsevier, vol. 92(1-2), pages 1-33, February.
    6. Boulding, Kenneth E, 1969. "Economics as a Moral Science," American Economic Review, American Economic Association, vol. 59(1), pages 1-12, March.
    7. George A. Akerlof & Rachel E. Kranton, 2000. "Economics and Identity," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 115(3), pages 715-753.
    8. Cornes,Richard & Sandler,Todd, 1996. "The Theory of Externalities, Public Goods, and Club Goods," Cambridge Books, Cambridge University Press, number 9780521477185, November.
    9. Buchanan, James M, 1978. "Markets, States, and the Extent of Morals," American Economic Review, American Economic Association, vol. 68(2), pages 364-368, May.
    10. I. M. D. Little, 1949. "The Foundations Of Welfare Economics," Oxford Economic Papers, Oxford University Press, vol. 1(2), pages 227-246.
    11. McCloskey, Deirdre N., 1998. "Bourgeois Virtue and the History of P and S," The Journal of Economic History, Cambridge University Press, vol. 58(2), pages 297-317, June.
    12. McCloskey, Deirdre Nansen, 2006. "The Bourgeois Virtues," University of Chicago Press Economics Books, University of Chicago Press, number 9780226556635, October.
    13. Bernheim, B Douglas & Shleifer, Andrei & Summers, Lawrence H, 1986. "The Strategic Bequest Motive," Journal of Labor Economics, University of Chicago Press, vol. 4(3), pages 151-182, July.
    14. Daniel B. Klein & Pedro Romero, 2007. "Model Building versus Theorizing: The Paucity of Theory in the _Journal of Economic Theory_," Econ Journal Watch, Econ Journal Watch, vol. 4(2), pages 241-271, May.
    15. Laurence R. Iannaccone, 1998. "Introduction to the Economics of Religion," Journal of Economic Literature, American Economic Association, vol. 36(3), pages 1465-1495, September.
    16. Fikret Adaman & Yahya M. Madra, 2002. "Theorizing the "Third Sphere": A Critique of the Persistence of the "Economistic Fallacy"," Journal of Economic Issues, Taylor & Francis Journals, vol. 36(4), pages 1045-1078, December.
    17. Hirschman, Albert O, 1982. "Rival Interpretations of Market Society: Civilizing, Destructive, or Feeble?," Journal of Economic Literature, American Economic Association, vol. 20(4), pages 1463-1484, December.
    18. Silber, Jacques, 2003. "Gary S. Fields, Distribution and Development, A New Look at the Developing World: (Russel Sage Foundation, New York, and The MIT Press, Cambridge, Massachusetts, and London, 2001), pp. x+260, [UK poun," Journal of Development Economics, Elsevier, vol. 70(1), pages 238-243, February.
    19. Samuel Bowles, 1998. "Endogenous Preferences: The Cultural Consequences of Markets and Other Economic Institutions," Journal of Economic Literature, American Economic Association, vol. 36(1), pages 75-111, March.
    20. Baron, James N & Hannan, Michael T, 1994. "The Impact of Economics on Contemporary Sociology," Journal of Economic Literature, American Economic Association, vol. 32(3), pages 1111-1146, September.
    21. Smith, Adam, 1776. "An Inquiry into the Nature and Causes of the Wealth of Nations," History of Economic Thought Books, McMaster University Archive for the History of Economic Thought, number smith1776.
    22. Marwell, Gerald & Ames, Ruth E., 1981. "Economists free ride, does anyone else? : Experiments on the provision of public goods, IV," Journal of Public Economics, Elsevier, vol. 15(3), pages 295-310, June.
    23. Wilfred Dolfsma, 2009. "Market and Society: How Do They Relate, and How Do They Contribute to Welfare?," Palgrave Macmillan Books, in: Institutions, Communication and Values, chapter 2, pages 6-13, Palgrave Macmillan.
    24. Laurence R. Iannaccone, 1998. "Corrigenda [Introduction to the Economics of Religion]," Journal of Economic Literature, American Economic Association, vol. 36(4), pages 1941-1941, December.
    25. Edward O'Boyle, 2000. "Personalist Economics: Moral Convictions, Economic Realities, And Social Action," Review of Social Economy, Taylor & Francis Journals, vol. 58(4), pages 539-552.
    26. Stark,Oded, 1999. "Altruism and Beyond," Cambridge Books, Cambridge University Press, number 9780521663731, November.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Rick Wicks, 2012. "Assumption Without Representation: The Unacknowledged Abstraction from Communities and Social Goods," The American Economist, Sage Publications, vol. 57(1), pages 78-95, May.
    2. Wicks, Rick, 2011. "Assumption without representation: the unacknowledged abstraction from communities and social goods," MPRA Paper 51674, University Library of Munich, Germany.
    3. Rick Wicks, 2011. "Markets, Governments—," Challenge, Taylor & Francis Journals, vol. 54(4), pages 65-96.
    4. Wolfgang Grassl, 2011. "Hybrid Forms of Business: The Logic of Gift in the Commercial World," Journal of Business Ethics, Springer, vol. 100(1), pages 109-123, March.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Wicks, Rick, 2011. "Assumption without representation: the unacknowledged abstraction from communities and social goods," MPRA Paper 51674, University Library of Munich, Germany.
    2. Rick Wicks, 2009. "A model of dynamic balance among the three spheres of society – markets, governments, and communities," International Journal of Social Economics, Emerald Group Publishing Limited, vol. 36(5), pages 535-565, April.
    3. Rick Wicks, 2012. "Assumption Without Representation: The Unacknowledged Abstraction from Communities and Social Goods," The American Economist, Sage Publications, vol. 57(1), pages 78-95, May.
    4. Rick Wicks, 2011. "Markets, Governments—," Challenge, Taylor & Francis Journals, vol. 54(4), pages 65-96.
    5. Cosgel, Metin M. & Minkler, Lanse, 2004. "Rationality, integrity, and religious behavior," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 33(3), pages 329-341, July.
    6. Marion Fourcade & Etienne Ollion & Yann Algan, 2015. "La superioridad de los economistas," Revista de Economía Institucional, Universidad Externado de Colombia - Facultad de Economía, vol. 17(33), pages 13-43, July-Dece.
    7. Teraji, Shinji, 2008. "Culture, effort variability, and hierarchy," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 37(1), pages 157-166, February.
    8. Niclas Berggren & Therese Nilsson, 2013. "Does Economic Freedom Foster Tolerance?," Kyklos, Wiley Blackwell, vol. 66(2), pages 177-207, May.
    9. M. Leroch & C. Reggiani & G. Rossini & E. Zucchelli, 2012. "Religious attitudes and home bias: theory and evidence from a pilot study," Working Papers wp811, Dipartimento Scienze Economiche, Universita' di Bologna.
    10. David George, 2006. "Social class and social identity," Review of Social Economy, Taylor & Francis Journals, vol. 64(4), pages 429-445.
    11. Bozzano, Monica, 2017. "On the historical roots of women's empowerment across Italian provinces: religion or family culture?," European Journal of Political Economy, Elsevier, vol. 49(C), pages 24-46.
    12. Lambarraa, Fatima & Riener, Gerhard, 2015. "On the norms of charitable giving in Islam: Two field experiments in Morocco," Journal of Economic Behavior & Organization, Elsevier, vol. 118(C), pages 69-84.
    13. Jimena Hurtado, 2005. "The Utilitarian Foundations Of The Economic Approach To Human Behavior," Documentos CEDE 3633, Universidad de los Andes, Facultad de Economía, CEDE.
    14. Apolte, Thomas & Müller, Julia, 2022. "The persistence of political myths and ideologies," European Journal of Political Economy, Elsevier, vol. 71(C).
    15. Stringham, Edward Peter, 2011. "Embracing morals in economics: The role of internal moral constraints in a market economy," Journal of Economic Behavior & Organization, Elsevier, vol. 78(1), pages 98-109.
    16. Kumar, Rahul & Maity, Bipasha, 2022. "Cultural norms and women’s health: Implications of the practice of menstrual restrictions in Nepal," World Development Perspectives, Elsevier, vol. 27(C).
    17. Stergios Skaperdas & Samarth Vaidya, 2020. "Why did pre-modern states adopt Big-God religions?," Public Choice, Springer, vol. 182(3), pages 373-394, March.
    18. Sriya Iyer, 2016. "The New Economics of Religion," Journal of Economic Literature, American Economic Association, vol. 54(2), pages 395-441, June.
    19. Klaus Prettner & Holger Strulik, 2017. "It's a Sin—Contraceptive Use, Religious Beliefs, and Long-run Economic Development," Review of Development Economics, Wiley Blackwell, vol. 21(3), pages 543-566, August.
    20. Cardenas, Juan-Camilo & Ostrom, Elinor, 2004. "What do people bring into the game? Experiments in the field about cooperation in the commons," Agricultural Systems, Elsevier, vol. 82(3), pages 307-326, December.

    More about this item

    Keywords

    communities; meta-economic efficiency; Relational Models theory; social capital; social goods; three spheres.;
    All these keywords.

    JEL classification:

    • A12 - General Economics and Teaching - - General Economics - - - Relation of Economics to Other Disciplines
    • A13 - General Economics and Teaching - - General Economics - - - Relation of Economics to Social Values
    • B52 - Schools of Economic Thought and Methodology - - Current Heterodox Approaches - - - Historical; Institutional; Evolutionary; Modern Monetary Theory;
    • D20 - Microeconomics - - Production and Organizations - - - General
    • H10 - Public Economics - - Structure and Scope of Government - - - General
    • O30 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - General
    • P00 - Political Economy and Comparative Economic Systems - - General - - - General
    • Z10 - Other Special Topics - - Cultural Economics - - - General

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:hhs:gunwpe:0292. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Jessica Oscarsson (email available below). General contact details of provider: https://edirc.repec.org/data/naiguse.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.