This error arises as follows: if an economic fact is a practical activity, it is still necessary to say how this activity is distinguished from moral activity. But moral activity is defined as altruistic; then, it is inferred, economic data will be egoistic. Into this mistake has fallen, amongst others, our able Professor Pantaleoni, in his Principî d'economia pura, and in other writings.
The egoistic is not something merely different from a moral fact; it is the antithesis of it; it is the immoral. In this way, by making the economic principle equivalent to an egoistic fact, instead of distinguishing economics from morality, we should be subordinating the former to the latter, or rather should deny it any right to exist, recognising it as something merely negative, as a deviation from moral activity.
A datum in economics is quite different. It does not form an antithesis to a moral datum; but is in the peaceable relation of condition to conditioned. It is the general condition which makes the rise of ethical activity possible. In the concrete, every action (volition) of man is either moral or immoral, since no actions are morally indifferent. But both the moral and the immoral are economic actions; which means that the economic action, taken by itself, is neither moral nor immoral. Strength of character, for example, is needed both by the honest man and by the cheat.
It seems to me that you approach gropingly to this conception of the economic principle, as relating to practical actions, which taken in the abstract, are neither moral nor immoral; when at one point in your last essay, you exclude from economic consideration choices, which have an altruistic motive; and further on, exclude also those which are immoral. Now, since choices are necessarily either altruistic or egoistic, either moral or immoral, you have no way of escaping from the difficulty except the one which I suggest; to regard economics as concerned with practical activity in so far as it is (abstractly) emptied of all content, moral or immoral.
I might enlarge further on this distinction and show how it has an analogy in the sphere of theoretical activity, where the relation of economics to ethics is repeated in the relation of æsthetics to logic. And I might point out the reason why scientific and æsthetic productions cannot be subjects of economic science, i.e. are not economic products. The reason given, in this connection, by Professor Ehrenfels, is, to say the least of it, curious: he remarks that: 'the relations of value upon which the data of logic and æsthetics rest, are so simple that they do not demand a special economic theory.' It should not be difficult to see that logical and æsthetic values are theoretical and not practical values, whereas economic value is a practical value, and that it is impossible to unite an economics of the theoretical as such. When, some years ago, the lamented Mazzola sent me the introduction in which he had discussed Economics and Art, I had occasion to write to him and afterwards to say to him by word of mouth, that much more fundamental relations might be discovered between the two groups of phenomena; and he urged me to expound my observations and inquiries. This I have done in the essay on Estetica, referred to above. I am sorry to be obliged to refer so many times in writing to you and to the public. But here the need for brevity and clearness constrains me.
This, then, is a rapid statement of how I arrive at the definition of the data of economics, which I should like to see at the beginning of every economic treatise. The data of economics are the practical activities of men in so far as they are considered as such, independent of any moral or immoral determination.
Granted this definition, and it will be seen also that the concept of utility, or of value or of ofelimity, is nothing but the economic action itself, in so far as it is rightly managed, i.e. in so far as it is really economic. In the same way as the true is thinking activity itself, and the good is moral activity itself.
And to speak of things (physical objects) as having or not having value, will appear simply a metaphorical usage to express those causes which we think efficacious to produce the effects which we desire, and which are therefore our ends. A is worth b, the value of a is b, does not mean (the economists of the new school knew it well) a=b; nor even as is said a>b; but that a has value for us, and b has not. And value—as you know—exists only at the moment of exchange, i.e. of choice.
To connect with these general propositions the different problems which are said to belong to economic science, is the task of the writer of a special treatise on economics. It is your task, esteemed friend, if after having studied these general propositions, they seem to you acceptable. To me it seems that they alone are able to safeguard the independence of economics, not only as distinct from History and Practice but as distinct from Mechanics, Psychology, Theory of Knowledge, and Ethics.
Naples, 15th May 1900.[97]