A Study of Ethico‐Economics in the General Equilibrium Field

Abstract

To start off our ethical economic thesis in this article, a few examples will suffice to point out the important relevance of ethical considerations in economic theory. During the 1950s and the 1960s the developing countries were being swayed by economic planners on prescriptions of neo‐classical growthmanship. Two such prescriptive models of economic growth were the Harrod‐Domar model and Rostow's linear stages model. According to the Harrod‐Domar model, economic growth was based on the attainment of the right quantity and mixture of savings, investment and foreign aid. Third World countries were being asked to follow a plan based on a long‐run economic growth path emulating the pattern of growth of the developed economies. In Rostow's linear stages model, optimisation of savings and investment was considered as the principal instrument of economic growth for the Third World. It turned out that the mobilisation of capital through savings and investment took the form of massive and expensive transfer of technology from the industrialised countries to the developing ones.

Citation

Alam, M. (1987), "A Study of Ethico‐Economics in the General Equilibrium Field", International Journal of Social Economics, Vol. 14 No. 3/4/5, pp. 207-218. https://doi.org/10.1108/eb014061