Relationship between Ethics, Economics and Politics with special application to Transportation Engineering using utility theory
Authors: Dr. Chandrasekhar Putcha, Lakshimi Lavanya Bandaru, Dr. Hakob Avetisyan
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This paper deals mainly with establishing a relationship between three parameters, namely, Ethics, Economics, and Politics using the concept of utility theory. It also shows application of utility theory to Transportation Engineering. Ethics is generally connected to virtue, good social behavior etc. Economics in general deals with profit maximization. Politics, as is well-known deals with a political climate in any given country directly relating to the leaders of that country. In a general sense, one can see the relation between these three variables. This is because the economic policies that are followed by any country will depend on the party in power and the political leaders. Therein comes the concept of ethics whether policies followed deal only with the sole objective of profit maximization with no consideration of ethics or they are based on some kind of ethical values. In particular, this paper will study in detail the two opposite philosophies proposed by Galbraith (1991) and Drucker (1993). Galindo and Cuevas (2008) state that four basic principles shape the fundamental and ethical criteria in economic behavior. These are 1. Ethics deals with “values”. 2. These values must be widely established in society. 3. Economic behavior must pursue an individual interest. 4. At the same time, the economic behavior must pursue a common interest. While the principles 1 and 2 are more of philosophical nature and so this paper will not focus on these. It is the principles 3 and 4 that this paper will concentrate. While Drucker seems to advocate principle 3, Galbraith advocates principle 4. However, the work reported by Galbraith seems to indicate that he supports a welfare state while the work of Drucker indicates that he supports the importance of the third sector i.e. non-governmental organizations, charity organizations etc. Nevertheless, the point remains is that some kind of efficiency criteria should be developed to reduce social inequalities. It is this part that this paper will focus on after going through in detail the two opposing theories of Galbraith and Drucker. At the end of the paper, application of utility theory is illustrated to Transportation Engineering.