Bentham and the Philosophy of
Utilitarianism
The pursuit of happiness as the basis for human action
Economists’ concern with utility as the basis for demand has its roots in the writings of English
philosopher and social reformer Jeremy Bentham (1748–1832).
Bentham argued that people want to obtain the greatest amount of happiness or ‘utility’ and
the least amount of pain. This applies to all activities, but in terms of consumer demand it could
be translated as the desire to maximise consumer surplus. To do this people should conduct a
‘felicific calculus’: in other words they should weigh up the costs and benefits of their actions.
From this basis Bentham developed the doctrine of utilitarianism. This states that society
should strive to achieve the greatest happiness of the greatest number. To do this, it would be
necessary to measure happiness (as a positive figure) and pain or unhappiness (as a negative
figure). Alternative courses of action could then be compared and the one giving the greatest net
benefit should be adopted.
As a social reformer Bentham developed plans for improving laws, institutions (such as
hospitals and schools), the police, the courts, etc, and he had an enormous influence on
politicians of the day and had many disciples. The basis for all these reforms was the belief that
they would lead to an increase in utility for society.
Bentham has been much criticised by economists and other social scientists. There are four
main criticisms:
The impossibility of ‘inter-personal comparisons of utility’.
The argument here is that there is no way of adding up the happiness (or pain) of different
individuals. It can only be experienced by the receiver. There is no way we can get inside other
people’s heads and measure their happiness.
If some people gain and others lose from an activity, is it desirable? How can we decide
using the utilitarian principle if we cannot measure this pleasure and pain?
The confusion of total and marginal utility.
If utility is to be seen as the basis for demand, then it is marginal utility that is important, not
total utility (see Box 4.2).
Deriving a normative from a positive statement.
Just because individual people may desire happiness it does not follow that happiness should be
the objective of society. To say that happiness is desired (a positive statement) does not imply
that happiness is desirable (a normative statement).
Other social objectives
Many critics have argued that there are alternative social objectives to happiness – objectives
such as the pursuit of knowledge, duty to God or other people, freedom, discipline, etc.
But despite these criticisms, Bentham’s contribution to modern economic philosophy is a major
one.
Economics is the study of choices arising from the problem of scarcity. Most economists
would argue that rational choice must involve the weighing up of the costs and benefits of the
alternatives. In the field of public economic policy, economists have developed cost–benefit
analysis. This is simply a means of weighing up whether or not to go ahead with public
projects: projects such as a new motorway, a hospital or the Channel tunnel. Such cost-benefit
analyses can be seen as a modern form of ‘felicific calculus’. (Cost–benefit analysis is examined
in Chapter 11, section 4.)
Question
Economists usually assume that consumers wish to maximise their total consumer surplus.
They also often assume that society’s aims are to maximise the surplus of total social benefits
over total social costs. Does this mean that economists are utilitarians?