Development as Freedom | Amartya Sen

Summary of: Development as Freedom
By: Amartya Sen

Introduction

Welcome to the summary of ‘Development as Freedom’ by Amartya Sen – a ground-breaking work that explores the relationship between freedom, material well-being, and economic development. In this book, Sen challenges traditional economic theories and argues that evaluating economic development through a person’s capability set is the key to measuring their well-being and ultimately, development. Shifting economic thinking from purely quantitative measurements, like income, Sen emphasizes the importance of considering individual freedoms and various social and environmental factors in assessing a person’s overall quality of life.

Tupac’s Dilemma

Tupac, a wealthy man, needs to hire someone to maintain his swimming pool. Three unemployed people beg for work, but he only has one pool vacuum, so he must choose. The candidates are Jake, the most destitute; Bertrand, who recently became poor and is depressed, and Lakrisha, who has a bad limp. Tupac is conflicted, but he decides to hire Lakrisha so that she can afford medical help and have a better quality of life. This situation represents a microcosm of world economics, where institutions must decide how to allocate resources while taking into account efficiency and equity. The dilemma faced by Tupac reflects the priorities in deciding what should be at the core of our normative concern, whether income-egalitarian, classical utilitarianism, or a new way of looking at economics that involves quality of life issues.

Economic Theories and the Importance of Information

Economic theories often revolve around different perspectives of justice, including utilitarianism, libertarianism, and Rawlsian thought. Utilitarianism prioritizes happiness over individual freedoms, while classical libertarianism focuses on enumerating rights and liberties. On the other hand, Rawlsian philosophy leans towards prioritizing property and personal rights, even if they override efforts to alleviate poverty, increase education, and improve healthcare. However, all economic theories are limited by the completeness of information available, which often leads to incomplete or flawed analyses. Therefore, economists must place greater emphasis on not just assigning evaluative weights but also placing them up for public discussion and critical scrutiny. Otherwise, the theories they espouse may not be effective in addressing the complex economic challenges faced by society.

Understanding Utilitarianism and Well-Being

This passage delves into the concept of utilitarianism, particularly Bentham’s definition of utility, which includes happiness and pleasure. However, the theory has been modified to include satisfaction with the status quo, which is subjective. While utilitarianism economics may make sense theoretically, it may not apply in practice, especially in diverse populations. The author argues that using income and commodity supply to measure well-being often overlooks five specific variations, including personal heterogeneities, environmental diversities, variations in social climate, differences in relational perspective, and distribution within the family. The passage highlights that judgments of justice should not be complete and that opulence should not be the only measure of well-being. Instead, enhancing an individual’s desired goals, including primary goods like rights, liberties, opportunities, income, wealth, and social basis of self-respect, should be put into consideration when evaluating well-being, freedom, and capability.

Evaluating Economic Processes

Economic processes cannot be evaluated based on just utilities or primary goods. It should include substantive freedoms that allow individuals to choose a valued life. Hence, economists create functioning vectors that depend on people’s capability sets. Comparisons are difficult because the metrics used to compare depend on what people value. For example, adequate nourishment and health are fundamental functionings, while self-respect among peers is an extreme functioning. Therefore, evaluating economic processes requires considering people’s capability sets and understanding how they determine individuals’ functioning vectors.

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