Economic theory; freedom and rights

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Briefing Paper
November 2001

Economic Theory, Freedom and Human Rights:
The Work of Amartya Sen
This Briefing Paper reviews the ways in which the Nobel Prize winning economist Professor Amartya Sen has focussed
international attention on the significance of fundamental human freedoms and human rights for development theory and practice. In the past, dominant approaches have often characterised
development in terms of GDP per capita; food security in terms of food availability; and poverty in terms of income deprivation. Emphasis was placed on economic efficiency – with no explicit role being given to fundamental freedoms, individual agency and human rights. In contrast, Sen’s research has highlighted the central idea that, in the final analysis, market outcomes and government actions should be judged in terms of valuable human ends. His work has contributed to important paradigm shifts in economics and development – away from approaches that focus exclusively on income, growth and utility, with an increased emphasis on individual entitlements, capabilities, freedoms and rights. It has increased awareness of the importance of respect for human rights for socio-economic outcomes – challenging the proposition that growth should take priority over civil and political rights, while highlighting the role of human rights in promoting economic

security, and the limitations of development without human rights guarantees.

Moving theoretical and empirical economics
forward: The building blocks of Sen’s
approach

expanding the types of variables and influences that are
accommodated in theoretical and empirical economics. His
contributions include far-reaching proposals for incorporating individual entitlements, functionings, opportunities, capabilities, freedoms and rights into the conceptual foundations and
technical apparatus of economics and social choice. These
proposals reflect a number of central recur r ing themes
including:
• the importance of pluralist informational frameworks that take account of both the well-being aspect of a person
(relating to his or her own personal physical and mental
well-being) and the agency aspect (relating to the goals
that a person values, desires and has reasons to pursue;
and being sensitive to processes as well as to outcomes –
reflecting the intrinsic value of individual choice and
participation).
• the need to go beyond the assessment of utility and
income, taking account of entitlements, capabilities and
functionings, and adopting a broad view of preferences,
incorporating the capability to achieve what is valued and counterfactual choice (what people would choose, given the choice). • the importance of approaches giving a central role to
freedoms and rights. In Sen’s view, this importance cannot be captured in terms of the utility metric. Welfarist
informational bases are too narrow to reflect the intrinsic
value of freedom and rights, which should be brought
directly into social-economic evaluation.

The limitations of traditional welfare economics

Economics beyond ‘welfarism’
Given the limitations of traditional approaches, Sen has
elaborated a ser ies of for mal proposals for moving the
economics agenda forward – beyond ‘welfarism’ – and for

The ‘common currency’ of development
Past approaches

New approaches

Individual
interests/
advantage/
well-being

Income/
Consumption/
Utility (i.e.
individual
happiness and/or
desire fulfilment)

Human capabilities and
opportunities – with an explicit
role for freedom, agency and
rights

Food
security

National food
availability

The food entitlements of
individuals and groups

Poverty

Deprivation in
income/
consumption/
expenditure

Deprivation in human
capabilities such as knowledge,
longevity and living standards
(e.g. access to water and
services) – more emphasis on
self-reporting, self-esteem,
participation and
empowerment

Ultimate
ends of...
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