Title: The concept of a “merit good” the ethical dimension in economic theory and the history of economic thought or the transformation of economics into socio-economics
Abstract: The purpose of this paper is to defend the concept of a “merit good” and to expand its application. This is achieved by using a Kantian philosophical argument applied to the writings of foundational economists such as Adam Smith and Henry Simons (and Walter Eucken in the German literature). As a result the concept of a “merit good” is used to classify and argue for a number of governmental tasks such as the institutional arrangements to make a free market economy work, work efficiently and work in a humane way. Methodologically, this paper connects—as the work of Joseph A. Schumpeter already has—economic theory, the history of economic thought and institutional economics and thereby demonstrates that economics is necessarily about socio-economics.