Topics Covered

• Understand the way that thought experiments can be used to generate fundamental principles.
• Have knowledge of the two principles of justice used in the Theory of Justice.
• Be introduced to the approach of John Rawls, often regarded as the greatest moral philosopher of the 20th Century.
• Understand the difference between economic approaches based on the ‘hidden hand’ of a free market, and institutional economics, in which transaction costs are considered to be important.
• Appreciate the factors that reduce transaction costs.
• Be introduced to Douglass North, who is often regarded as the father of modern institutional economics.
• Understand the practical difficulties of applying the principle of equality to decision-making.
• Be able to perform a simple test to show how collective modes of choice can be logically inconsistent.
• Be introduced to Ken Arrow, who demonstrated the difficulty of rational choice in social welfare.
• Be able to recognise the application of Rawls’ principles of justice to policy.
• Understand the violation of the second principle of justice when applied to saving for future generations.
• Appreciate that the solution to intergenerational justice is to have fairness in the present generation.