Under traditional economics utility is subjective. Under CAE we discern between personal and objective utility. Personal utility is classical economic utility or personal preference. Objective utility is defined in two ways and the two ways will always yield the same result.
The first definition of objective utility is the subjective preference of the objective reference frame, God. The second definition of objective utility comes from the idea that there is a perfect allocation of all things.
A perfect allocation of all things entails more than simply an efficient resource allocation. With highest relevance, a perfect allocation of all things would entail that the preferences of all individuals have been ideally configured.
If a perfect allocation of all things were to be achieved then the subjective utilities of all individuals would be equivalent to their objective utilities. As a result, all aggregate market demands would be at their morally ideal values. Finally, the emergent price equilibria in such markets would be the set of objective values or prices.
Summarily, CAE establishes the existence of intrinsic value where the intrinsic value of a good may be defined equivalently in the following two ways:
- God’s willingness to pay for a good.
- The market price for a good when microeconomic demand is the optimized result of a function of efficiency and objective moral considerations.
The assertion of the equivalence of these two definitions is a fundamental identity claim of CAE. The assertion may be called the Invisible Hand Axiom and stated this way:
Reality will self-optimize in the long run and this self-optimized state reflects the will of God.
A key theory in CAE is that beliefs and preferences are choices conducted at the individual level as a function of an environmental effect and a volitional or spiritual factor of identity.
Consistent with this hypothesis, it is hypothesized that market forces act to incentivize the structure of individual and social beliefs and moral preferences in the same way such market forces are observed to influence other individual and social behavioral choices.
It is finally expected that markets will tend toward moral efficiency in the same way that markets tend toward utilitarian and productive efficiency.
One notable component of the theory of dynamic moral optimization is the expectation for improvements in scriptural interpretation over time.
Several points may be worth highlighting:
- CAE is a post-free market economic discipline. Many of the requirements for free market flourishing are dependencies for the theory of dynamic moral optimization.
- Taking after the Austrian School and the related fields of Praxeology and Thymology, CAE leverages the concept of teleology and axiomatic logic to produce action axioms, or contingent action recommendations.
- In CAE the Church is viewed as a market comprised of Christians.
- There is an Apparent Church which is the aggregation of all people professing Christian identity and there is the Real Church which is comprised of those people who are actually Christians.
- The Real Church is theorized to persist in the long run, while the Apparent Church is theorized to shut down in the long run. There is a notable theological similarity between the economics of firm shutdown and the theology of perishing.
- There is an obvious identification difficulty for empirical work.
- Lastly are the two concepts of the human condition and interpretive proof.
Another named assertion is called the Human Condition Axiom and consists of the following claim:
Individuals necessarily have an imperfect ability to ascertain, process, retain, and act upon information.
While the Real Church is expected to approach a correct interpretation of scripture in the long run, it is not expected that an individual will ever be able to achieve perfect understanding of God, scripture, natural reality, or anything.
Despite the human condition, individuals should seek to improve understanding and ability. Individuals have some innate understanding and ability, and they may grow these competencies to great personal and social benefit.
The CAE framework offers the interpretive proof which is a tool intended to improve scriptural interpretation. Consistent with what has just been mentioned, the execution of an interpretive proof doesn’t entail the truth of the proven interpretation.
It is merely hypothesized that an interpretation of scripture for which there is a valid interpretive proof is less likely to be fallacious than an interpretation of scripture which is rejected under the method of interpretive proof.
The interpretive proof is simply one method of interpretation and it is recommended for use alongside other hermeneutic methods. In my next post I will do an example proof but in this post I will explain how it works. The interpretation is proven when it “comes full circle.”
An interpretation is said to have come full circle when it is taken from observation and verified by observation, although the same observations needn’t, and perhaps shouldn’t in order to avoid circular reasoning, be used. Let’s say I want to prove that a proper interpretation of Christianity is that we should pursue traditional marriage. On the one hand I can look at countries around the world and see that they have superior economies when they have a prevalence of traditional marriage. This is a one-handed proof and it provides evidence that traditional marriage is a component of a superior economy. The superiority demonstrates something of God’s will. God’s will is that reality be allocated more like a traditional marriage-based society than like the average society. When we provide evidence for a characteristic of the optimized reality, and that characteristic is advocated by a particular morality, we say that we have a “left-handed proof” of God’s will being in accordance with a particular morality.
It should be noticed that claiming God’s will is consistent with personal morality is related to Divine Command Theory, the Epicurean Paradox, and a variety of other topics. Those discussions are for another time.
While a left-handed proof is based on secular data, a “right-handed proof” is based on observation of exclusively Christian sources. Reading the Bible is one example of observing an exclusively Christian source. If we come up with an explanatory interpretation using the Bible then we have a “right-handed” interpretation. In order to verify that interpretation we must test it against the left hand and against extra-biblical data.
When the left handed interpretation is consistent with the right handed interpretation we have completed a CAE Interpretive Proof. I will conduct an example of such a proof in my next post.