This file is a short single-author academic discussion. Morgenstern is speaking as a discussant, responding mainly to Abram Bergson and Jan Tinbergen, with Fritz Machlup mentioned in passing. Its scope is narrow but pointed: it questions whether economists can responsibly speak of productivity, optimality, equality, and social planning without firmer measurement, formal proof, and explicit value judgment.
Morgenstern first addresses Bergson’s comparative productivity argument. He praises the difficulty of the topic but warns that Bergson begins by doubting the data and then gradually relies on them. The key technical objection concerns the changing character of modern economies: “productivity” may be intelligible in physical production, but it becomes obscure when services dominate national income.
Services predominate rather than physical output, and the notion of productivity in regard to service industries is one of the weakest concepts in economics and thus should be used in this particular connection only with greatest restraint.
This is the essay’s first conceptual move: to deny that familiar economic terms carry automatic empirical clarity. Morgenstern stresses that economics is not in the same observational position as the physical sciences. In service economies, management, organization, and intangible outputs complicate any simple comparison between countries or systems.
His deeper disagreement is with Tinbergen, whose discussion assumes that social policy can identify and pursue an optimum. Morgenstern insists that “optimum” is not an intuitive good to be invoked rhetorically; it must be defined with mathematical precision, and its existence must be shown.
For example, the notion of an "optimum" seems to be a very clear concept, but it is far from it.
The point is methodological and polemical. Recent economic theory, he says, has produced counterexamples in which no optimum exists under specified conditions. Thus the planner’s vocabulary may promise more than theory can justify.
Therefore to talk about the existence of an optimum without proving that the particular optimum actually exists is a very questionable matter.
From there Morgenstern broadens the objection to the effort to formalize society itself. Social order cannot be reduced to a single technical program, because social preferences, principles, and institutions involve conflicting judgments.
But once more, I think it has also been shown lately that it is in principle impossible to formalize society.
His discussion of equality develops this critique politically. The “fundamental equality of man,” he argues, is not a self-evident operational principle. People differ in talents, capacities, prestige, and income-generating ability; even socialist societies exhibit large internal differentiations. The decisive question is not only whether equality can be imposed, but whether it can remain stable.
What will hold equal incomes really equal in the long run?
For Morgenstern, this question exposes the coercive underside of distributive aspiration. If inequalities reappear, continuous intervention may be required, raising the problem of who enforces equality and by what authority. He therefore treats egalitarian optimality as both a formal and constitutional problem.
The conclusion shifts from criticism to a general principle. The same physical circumstances can sustain multiple stable social organizations, so science alone cannot select among them. At that point, choice depends on ethical, moral, and political commitments outside the model.
There is no scientific reason why one system should be preferred over the other.
Morgenstern’s final appeal, drawn from Nicholas Cusanus, is not anti-aspirational. Rather, aspirations must be disciplined by knowledge of what is possible and by an honest recognition of plural values.
And that is to say, we must have aspirations and develop aspirations which are possible.
The essay remains relevant as a compact warning against technocratic welfare language. Morgenstern does not reject formal economics; he demands that it know its limits. Its core moves are to question weak measurement, require existence proofs for optima, test equality for stability, and separate scientific analysis from political value choice.
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