by Gioacchino La Rocca

A working hypothesis: from Kant to Hegel

The current electoral time resonates with words such as "liberal," "progressive," and "conservative," which, however, seem to have a marked flavor of labels, good at best for evoking some suggestion of "right" or "left," albeit with all the doubts raised by such bipolarization1. On these grounds, it is unnecessary to ask whether we are facing "language games" subject to "mass media manipulation"2, or whether it is somehow possible to avoid such a bleak conclusion.

The deciphering of the possible meanings can start from the identification of a common denominator, however generic it may seem. In this vein, it is possible to observe that those words ("liberal," "progressive," "conservative") vaguely aim to summarize an idea of collectivity, that is, an idea of how -to what values - should be marked both by the relations between the individual and the other components of a given sociopolitical organization, and by the relations between individuals and the organization itself.

With an obvious but not entirely groundless schematism, it can perhaps be said that in the last two centuries two visions competed - with not necessarily decisive variations -: one that can be traced back to Kant, but firmly anchored in a tradition that could be retraced - again with broad approximations - from Aristotle to Natural Lawism; the other, which in more ways than one finds its inspiration in Hegel.

"A universal law of liberty"

According to the former view, each individual possesses prerogatives, rights, which he can exercise discretionally (according to his "arbitrariness": this is the word used by Kant: see second part of this article), with the only limitation that "the arbitrariness of one [may] accord with the arbitrariness of another according to a universal law of freedom."3 Grafted onto this paradigm were anthropological and, consequently, economic-political visions, the underlying contours of which are not difficult to discern.

On the anthropological level, that is, of the model of human being it presupposes, this orientation, which for convenience we may call "liberal-Kantian," postulates a human being who is inherently rational and, therefore, inherently free. The connection between rationality and freedom is of crucial importance: rationality can be described - again, I simplify greatly - as the capacity to direct own conduct toward a particular end within a coherent framework of preferences. This ability to identify its own ends and to organize its own behavior according to them has been interpreted by philosophers and jurists as confirming the freedom of each individual.

Only one limit is set to individual freedom. It consists in respect for the freedom and dignity of others. The "universal law of liberty," preached by Kant, is based on a dogma, which still retains its unquestionable solidity: no human being can be an "instrument" for the realization of other human beings' ends because that would be tantamount to violating his "dignity"4.

Two myths of the liberal paradigm: homo oeconomicus and allocative market efficiency

"Freedom" and "rationality," it has been said. From this pair draws the consequent assumption of the unquestionability and intrinsic "rightness" of individual choices: if individuals are free to choose, their rationality will guide them toward what is "good" and "right" for them. On this premise, it is clear that no one is entitled to question such choices: they constitute a value in themselves insofar as - the result of the individual's freedom/rationality - they express his or her intrinsic way of being. The only permissible exception - but one that in concrete reality is sometimes disapplied - is if the criminal law specifically prohibits the very choices, the resulting conduct and the ends pursued.

On these postulates, which constitute the founding moment of the "liberal" paradigm of society, have been built authentic "polar stars" of a part of Western thought. First and foremost is the figure of the "homo oeconomicus," that is, of a human being capable of organizing his or her preferences in an absolutely coherent and rational manner, so as to order his or her ends, and the goods to which he or she aspires, according to a perfectly clear and defined scale of priorities, so as to be able to achieve ends and goods with the least possible expenditure of resources.5 So much confidence was (and is) placed in this model of absolute rationality, that for more than a century economists have believed that they can describe and analyze human conduct through mere mathematical formulas, which leave very little room for the "humanity" of the subject they purport to study6

This model - so dehumanized and dehumanizing - has influenced not only the economists' studies. It, more precisely, has not remained confined in the limbo of so-called "neoclassical" economic theories and in the myth of the "catallaxy" of the market, that is, in the myth according to which the market, as the place where the choices of rational individuals are expressed, would as a rule be able to spontaneously reach an equilibrium such that everyone would be (more or less) satisfied, each according to his or her abilities. Rational consumers - argues those who support this thesis - will direct their resources to goods with a quality/price ratio they consider satisfactory. Likewise, rational producers will direct their production to goods that they see rewarded by consumer choice, that is, by the market, seeking to compress prices in order to attract more buyers, with the overall end result of greater satisfaction for most, if not all. Hence, the formula - born with reference to financial markets7 but later revived in a more general perspective - of "efficient markets."

It is of no interest here to point out that in today's reality, producers orient their production choices through sophisticated algorithms that can somehow "anticipate" the market8. Rather, it is of interest here to dwell on an important consequence of the idea of the market's allocative efficiency: if the market, which - again - is the place where individual choices assumed to be rational, free and conscious are expressed and compared, is able to meet the expectations of human beings, any "interference" on the part of the lawmaker can only be counterintuitive to the extent that it alters inherently efficient mechanisms. In a less abstract form, this idea can already be found in the statements of English philosophers and economists of the mid-19th century, who argued that no government would be able to know better than any merchant what was best for him in his commerce and what means were best suited to achieve this "best," with the corollary that government would have to be very careful not to intervene in commerce itself and generally as much in economic matters as in individual choices.

These theories, which we have tried to simplify as much as possible here, constituted the main stream of economic-political thought, which dominated the Western world for at least three decades, between the late twentieth century and the early 2000s, ultimately sanctioning what is called the primacy of economics over politics. In particular, these theories have inspired the concrete regulation of the financial market, which in recent decades has taken on a crucial role, thanks in part to the grafting of information technology, to the point of disentangling itself from the manufacturing production of which it was historically a servant. As for Europe, the most important product of the "more market, less state" refrain was Directive 2004/39/EC, also known as MIFID I.

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The aforementioned theories and subsequent regulatory applications set the stage for the financial crisis of 2007-20089. The reaction, however, was salutary and significant. At least as far as Europe is concerned, there has been a radical reversal of the trend: the return to a less market friendly and in some ways more incisive regulation than that advocated by the so-called "libertarian paternalism"10 has been enshrined in Directive 2014/65/EU, EU Regulation No. 600/2014 and numerous implementing directives11.

Postulate of rationality and cognitive deflections: the contribution of neuroscience

The changing strategies of market regulation are not unrelated to the decisive contribution of neuroscience. When technology made available to scientific research the tools to investigate the actual functioning of the human brain, there was confirmation of what had been intuited since the 1960s by the 2002 Nobel Laureate in economics, David Kahneman, namely, that human beings are as a rule subject to a number of cognitive errors, which significantly invalidate the assumption of the rationality of their choices: in fact, "experimental evidence radically challenges the idea that humans have consistent preferences and know how to maximize them, an idea that is the very basis of the rational agent model"12.

It is not, therefore, "bounded rationality" because of the difficulty of gathering and processing the information necessary for a truly rational choice as an informed one - as has been preached for decades by the so-called "information economy"13. The fact highlighted by recent research is structural, not amendable by a surplus of information about the context in which the decision is to be made: this is because mental mechanisms - cognitive neuroscience tells us14 - cause the decision maker to distort the objective relevance of information and to give greater weight to information and elements that corroborate his personal and self-referential preferences15.

The very structural nature of the fact imposes the need to rethink the value light projected on human choices. They are not an expression of the "spark of God," that is, of a being that is distinguished from other living organisms insofar as it is able to appreciate, albeit subjectively, the deep sense of "truth" reflected in "nature," experience, and History. "Experimental evidence" has shown that human beings, their preferences, and their choices are easily manipulated by those in the economic and political fields who aim to direct those choices according to their private interests.

In this scenario, we need to ask what remains of man's legitimacy to act on reality, which is founded from the Second Scholasticism onward precisely on the capacity - for centuries postulated as intrinsically immanent, autonomous, free - of human beings to appreciate, understand and, consequently, to will and act,16 thus placing themselves as the engine of History.

(to be continued)

1 See for example – in addition to Bobbio, Destra e sinistra. Ragioni e significati di una distinzione politica, Roma, 1994 – different perspectives of Fava, La destra e la sinistra nell’era dei populismi. Uno studio di caso, in “Polis”, 2022, 2, 219 ss.; Becchi, in “L’ircocervo”, 19 (2020), n. 1, 16; Tarchi, Destra e sinistra. Due concetti sospesi tra essenze, tipi ideali e convenzioni, in Passigli (cur.), La politica come scienza. Scritti in onore di Giovanni Sartori, Firenze, 2015, 471 ss.; Donnarumma, Destra e sinistra: una diade ancora attuale, in “Diritto penale e uomo”.
2 In this way Tarchi, op. cit., 480.
3 Kant, La metafisica dei costumi, trad. it. Di Vidari, Roma-Bari, 1998, 34.
4 See e.g. on surrogacy La Rocca, La genitorialità omoaffettiva tra artt. 2 e 29 Cost., in, 7 ss. A broad survey on "dignity" in Becchi, Il principio della dignità umana, Brescia, 2013.
5 Traditional economic theory postulates an "economic man" who, in being "economic," is also "rational." This man is assumed to have a knowledge of the relevant aspects of his environment that, if not complete in absolute terms, is at least exceptionally clear and voluminous. It is also assumed that he has a well-organized and stable preference system, and a computational skill that enables him to determine, among the alternative courses of action available to him, which one allows him to reach the highest obtainable point on his scale of preference: this is how H. A. Simon, Nobel laureate in economics 1978, critically describes the model referred to in the text in Un modello comportamentale di scelta razionale (A Behavioural Model of Rational Choice, 1955), now in Causalità, razionalità, organizzazione, Bologna, 1985, 119 ss.
6 Economists themselves are obviously aware of this: the 1991 Nobel Prize winner for economics sarcastically observed, among other things, that "the rational utility maximizer of economic theory has no point of contact with the man on the bus to Clapham, or really with any man or woman on any bus." (Coase, Impresa mercati diritto, ed. it., Bologna, 1995, 41 ss.).
7 Fama, Efficient Capital Markets: a review of theory and empirical work, in “The Journal of Finance”, 1970, vol. 25, n. 2, 383 ss.
8 See at least Mayer-Schönberger, Cukier, Big Data. Una rivoluzione che trasformerà il nostro modo di vivere, Milano, 2013.
9 On this see at least Onado, I nodi al pettine. La crisi finanziaria e le regole mai scritte, Roma-Bari, 2009; R. Posner, La crisi della democrazia capitalista, with pref. di Guido Rossi, Milano, 2010; Partnoy, Financial systems, crises and regulation, in Moloney, Ferran, Payne (curr.), The Oxford Handbook of financial regulation, Oxford University, 2017, 68 ss.
10 Sunstein, Effetto nudge. La politica del paternalismo libertario, ed. it., Milano, 2015.
11 See for indications La Rocca, Introduzione alla product governance. Premesse sistematiche; obblighi e responsabilità dei «produttori», in “Banca, borsa, tit. credito”, 2021, I, 566 ss.
12 Kahneman, Pensieri lenti e veloci, ed. it. Milano, 2013, 425.
13 For literature on this topic see at least Saltari (cur.), Informazione e teoria economica, Bologna, 1990; Löfgren, Persson, Weibull, Markets with asymmetric information: the contribution of George Akerlof, Michael Spence and Joseph Stiglitz, in “Scand. J. Of Economics” 104 (2), 195-211, (2002).
14 Oliverio, Neuroscienze cognitive, entry in the Enciclopedia Italiana, appendice VII, Roma, 2007.
15 Kahneman, op. cit., 91 ss.; Elster, Ulisse e le sirene. Indagini sulla razionalità e sull’irrazionalità, ed. it., Bologna, 1983, 219 ss.
16 Indeed, it has been argued that man has power over nature “per intellectum et voluntatem, quia per haec immediate habet potestatem in suos actus et per suos actus in res externas” (Lessio, De Iustitia et Iure ceterisque virtutibus cardinalibus libri quatuor. Ad secundam secundae, D. Thoma, a quaest. 47 usque ad 171., Ed. Tertia, Milano, 1613, Liber Secundus, Caput Quartum, Quibus et in quae Dominium competat, Dub. I, 1, pag. 23.

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Former Head of the Legal Department of a bank, he is currently Full Professor of Civil Law at the University of Milan-Bicocca. He has published six books and about a hundred articles and minor writings on private, commercial, banking, and financial law.