Economics, Psychology and Happiness: Virtue Theory vs. Slavery of the Passions

The truth of any economic theory ultimately hinges on the truth of its philosophy of man. In this essay I will analyze modern economic thought from two perspectives: firstly, from its criticism and development by experimental psychology; secondly, from the philosophical anthropology and Aristotle and Thomas Aquinas. I will argue that although there is much truth in modern economics, its philosophical underpinnings are flawed in important aspects, and this accounts for its inability to explain and understand human behavior in some significant respects. I will try to pinpoint the essential character of the philosophical error, and argue for a better philosophy of the person that can provide a starting point for building a new economics.