Discourse Ethics for Debt Markets

45 Pages Posted: 5 Feb 2016 Last revised: 2 Jul 2016

See all articles by Timothy C. Johnson

Timothy C. Johnson

Heriot-Watt University - Maxwell Institute for Mathematical Sciences

Date Written: June 2016


This paper develops a pragmatic theory of finance where in markets are considered to be centres of communicative action in the face of uncertainty. This contrasts with the conventional approach in economics that portrays markets as centres of strategic action in the face of scarcity. Our approach entails that markets must address the truthfulness, truth and rightness of the statements -- the prices quoted -- of its traders. This paper focuses on the debt markets and along with reciprocity examines and how subjective truthfulness claims are governed by the norm of sincerity, while social rightness claims are determined by the norm charity. The paper seeks to address crisis of legitimacy that the financial system, exemplified by that manifested in the U.K and U.S., is experiencing and finishes by observing that 'trust' in commerce is a synthesis of the three norms.

Keywords: debt, credit, markets, Habermas, discourse ethics

JEL Classification: B25, B26, D47, D88, E44, E50, G18, N23, Z1

Suggested Citation

Johnson, Timothy C., Discourse Ethics for Debt Markets (June 2016). Available at SSRN: https://ssrn.com/abstract=2727739 or http://dx.doi.org/10.2139/ssrn.2727739

Timothy C. Johnson (Contact Author)

Heriot-Watt University - Maxwell Institute for Mathematical Sciences ( email )

Edinburgh, Scotland EH14 4AS
United Kingdom

HOME PAGE: http://www.ma.hw.ac.uk/~timj/

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