Homo Economicus, Selfishness, Ethics and Economics

Abstract This paper attempts to go deep into foundational issues of contemporary ethics and economics such as: the departure of XX century mainstream economics from Adam Smith’s broad view of human nature, where empathy plays a crucial role, to embrace the unpleasant, greedy homo economicus; the (unnecessary) link between self-interest and rationality such that rational self-interested humans may turn out to be social idiots; the negative effects of the generational egoism that underlies the approach, favoured by climate change sceptics, to the assessment of policies aimed at facing global warming; the difficult coexistence of markets and morals, and the adverse effects of incentives aimed at “rational self-interested agents” in dealing with agents who have social or other-regarding preferences and with goods that should not have a price.