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If a maxim passes the categorical imperative test, it is permissible, but if it fails it is forbidden, resulting in a duty not to act on that maxim. To this end he developed the categorical imperative, a formalization of “the moral law”, against which plans of action (or maxims) must be tested. Kant argued that once people acknowledge the dignity of all persons, they must rationally act out of respect and consideration of them. Once we recognize the equal dignity of all persons, autonomy takes on moral content and becomes a responsibility as well as an ability.
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It is this dignity, based on autonomy, that grounds the normative aspects of Kant’s ethics. 2 On the basis of their capacity for autonomous choice, Kant held that persons have dignity, an incalculable and incomparable worth that distinguishes them from mere things and implies that they are worthy of respect and consideration.
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Footnote 1 In this sense, autonomy not only implies an independent and individual process of decision making but, more important, the possibility of counterpreferential choice: an agent can choose an action that corresponds with his or her moral code over the one that best satisfies his or her preferences. The best way to understand Kantian ethics is to begin with autonomy, the ability of persons to make moral decisions independent of both external authority and internal preferences and desires. Throughout, I show how a Kantian-economic model of choice casts these concepts in a new light and helps to expand the range of ethical motivations that economists can include in their models. After a brief summary of Kantian ethics and how it can be integrated into the standard economic decision-making framework of constrained preference-satisfaction, I will survey the most popular models of intrafamily altruism and resource allocation, focusing on the nature of preferences, the use of interdependent utility functions and bargaining models used therein. I will argue that the deontological ethics of Immanuel Kant offers a better framework for modelling the economic behaviour of agents within families, given the unique bonds between them. In this article, I suggest an alternative way to model altruism in the family, in the form of a system of ethics that goes beyond the preference-satisfaction and welfare-maximization of mainstream economic models of choice to include concepts like commitment and obligation, which are of special relevance to family interactions.
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However, most of the approaches used to model altruism in economics to this point have been rooted in the basic frameworks of preference satisfaction and utility maximization, both of which reflect the utilitarian thinking that lies at the heart of economic theory and prevent the consideration of principled behaviour that transcends preferences and utility. Economists studying intrafamily altruism have modelled it using a variety of methods, ranging from “warm glow”, multiple utilities and interdependent preferences, all of which have expanded the explanatory power of models in the field. Nowhere in economics is this of more concern than the economics of family, typified by interactions that are anything but anonymous and self-interested. It falls short, however, when dealing with behaviour outside this narrow band, especially interactions between persons who do not behave in a self-interested fashion towards each other. The standard assumption of homo economicus, an agent who maximizes his utility based on self-interested preferences and exogenous resource constraints, serves well for much anonymous market activity of consumers, investors and business managers. Mainstream economics has long struggled to model ethical behaviour, including what is perhaps its simplest type, altruism.