The Economics of Nonsense Upon Stilts: Basic Human Rights and Economic Analysis

Abstract

This chapter takes up the discussion on individual rights in modern economic theory. Taking Amartya Sen’s well-known impossibility theorem as a starting point, I discuss the various approaches to solve the underlying problem and to reconcile basic liberties with general notions of social welfare and economic efficiency. It is argued that the most promising approach to overcome the liberal paradox is to weight individual positions according to a commonly shared value function. Finally, I want to show that the well-established concept of “natural” basic human rights offers an appropriate way to operationalize this valuation function that is both sufficiently specific and flexible enough for applied ethics.