The economics of social progress

On McKinsey's "What Matters" blog, Iqbal Quadir, founder of the Grameen phone company writes an excellent article on the interplay between profit and social enterprise. Among other topics he discusses why charging for a service (v. giving it away) provides a better foundation for scaling the ability to help people than giving it away. He also shares some lessons learned about pricing and the need to hold firm to pricing strategies that allow a service to become profitable, even though it may limit the near-term social benefit. In the long run, the prices drop as the service scales, thus bringing economic benefit on a much broader scale than could achieved otherwise.

A Conservative Definition of Social Justice

I just listened to an interesting talk that Michael Novak gave to The Heritage Foundation called "Social Justice Is Not What You Think It Is." He points out that the origin of the term dates back to an Italian Jesuit priest named Luigi Taparelli (1793-1862) who struggled with how to deal with the shift from a predominantly agrarian society to one which included urbanization.

Novak makes a point of distinguishing between the English etymology of equality, which emphasized the qualitative aspect, from the French etymology which stems from egalite, and focus on quantitative equivalence. We do not all deserve the same thing quantitatively, argues Novak. For example, those who put in more effort toward a task deserve the greater reward. But we do deserve an reward of relative equivalence, regardless of who we were before we started the task, say upper class v. lower class.

Arguing from the perspective that individual rights are the best way to achieve the common good (v. socialist reliance on government), Novak describes it, social justice, properly understood, is a virtue, a habit that people internalize and learn. A capacity to organize and associate yourself with others to accomplish extra familia ends, for the good of others outside your immediate context, be it the community at large, your state, or even other parts of the world.

It's a long lecture, but interesting.