Aristotle Ethical Theory, Plato and Aristotle Theory

Ethics Dominant. — It is to be emphasized that the ideal of most of the Greek thinkers was highly ethical. To be happy one must be good, was a dominant note, and the interests of the soul were placed foremost. "For there are in all three things," Plato says,1 "about which every man has an interest; and the interest about money, when rightly regarded, is the third and lowest of them: midway comes the interest of the body; and first of all, that of the soul; and the state which we are describing will have been rightly constituted if it ordains honours according to this scale." And Aristotle's dictum is: "But a state exists for the sake of a good life and not for the sake of life only."

If one could conceive of Plato making a definition of eco­nomics, one might imagine it would run somewhat as follows: "Economics is the science which deals with the satisfaction of human wants through exchange, seeking so to regulate the in­dustries of the state as to make its citizens good and happy and so promote the highest well-being of the whole." That would make it an applied science, in which ethical aims would play a great part.

Summary. — From the foregoing discussion we may draw certain summary generalizations concerning the fundamentals of the economic thought of Aristotle and Plato:
a. Passive Idealism. — The spirit was considered to exist independently of the body. Innate differences among men were emphasized. Man's wants were held to be of primary importance in valuations; but wants were to be directed and limited accord­ing to ideals. Man-made institutions were given an important part. But after all, man wins only by making certain adjust­ments in his conduct. (A recognition of the limited perfect­ibility of mankind, and of the necessity of man's adjusting him­self to some extent to his environment, makes their idealism less extreme, particularly in Aristotle's case.)

b. Subjective Standards and an Emphasis on Human Wants. — Objective tests were not accepted as validating economic phe­nomena, for example, market prices. Some concept of "just" valuation, or the "just price" idea, and an emphasis on " value in use," or "utility," were corollaries. Justice in exchange, said Aristotle, depends upon wants. Similarly specialization of occupation, and the state itself, depend upon man's wants.

c. A Subordination of Individual to State, Accompanied by a Leaning toward an Undemocratic Sort of Communism. — The individual was regarded as a dependent part of the whole — the state. Thus there could be no real democracy, at least in the nineteenth-century sense. Their thought was opposed to the social contract concept of the state and tended toward an organismic concept.

d. A Normative Economics Mixed with Politics. — They thought of a purposive economy, with the state existing for the sake of "the good life." Ideals or standards of perfection were set up. Free choices by individuals were not accepted as the test. Economic values were so mixed with ethical and political values, that the science of Economics, as it was to develop later, was impossible.

Contrast with Hebrews and Hindus. — As already observed, there are important differences between the economic ideas of the Hebrews, Hindus, and other Oriental peoples, and those of the Athenian philosophers. They were similar in emphasizing the state, and the ethical point of view. Neither differentiated economics from politics or morals. Both were conservative and undemocratic. Moreover, with both, agriculture was the only industry in very good repute. But the Greeks were more concerned with the individual, going further in the analysis of the state into its citizens. They, too, were possessed of some small degree of historical method, though it was quite abstract. They analyzed economic wants, and based the oikonomik and chrematistik of their philosophy upon this analysis. The Athe­nian philosophers were more appreciative of material wealth as an agency in furthering human happiness than were the sacred writers of the Hindus, at least. The well-known care for the body by the Greeks had its economic significance.

Most important of all, the Greeks were more rational. In­stead of forbidding interest in pursuance of some divine edict, they argued about it and reached the conclusion that it was unjust. Thus the writings of Plato and Aristotle mark a great step in advance in economic method, as well as in scope and depth of analysis.