The Complex Self

Arrows criticisms of Titmuss’s arguments are right some of the time. Markets in blood may decrease altruism as a motive for giving blood but altruism must be distinguished from giving, sharing and co-operating. His argument is some commitment beyond a system of self-seeking individuals is necessary. (Arrow in Swedberg, 1990 p137)
The major finding of Titmuss was that the quantity of blood supplied was higher in countries such as the UK where no money was offered to those who gave blood but in percentage terms only 6% of eligible donors give blood in the UK. There is not comparable figures for the US. (Arrow, 1972 p350). Arrow makes the important point the data does not support Titmuss’s assertion a market in blood decreases altruism. The question as to why the development of a market in blood would decrease altruism is not addressed by Titmuss. (Arrow, 1972 p351). Titmuss suggests private market systems deprive men of their freedom to choose to give or not to give. It is a moral and political decision for the society as a whole he says. Arrow can find no support for such a dilemma. It may be the failure of voluntary giving to supply blood led to the commercial practice. (Arrow, 1972 p350). The poor and unemployed are predominately the suppliers of blood in the US and he wonders why anybody would object to them improving their financial situation.(Arrow, 1972 p347-351)
Arrow recognizes the allocation of goods and services is not accomplished entirely by exchange. The donation of blood is only one example of a large class of transactions for which there is not an element of payment. The whole structure of government expenditure is a departure from the system of mutual exchange. (Arrow, 1972 p344) In China and France for example, it is the government that manages the process of organizing the supply of blood. This has not improved the quality or the quantity of blood. In the last decades there have been a number of examples of systematic failures to maintain quality and a series of cover-ups and avoidance of responsibility for the transmission of infectious diseases. Arrow makes the point the process of exchange requires the presence of truth and trust in future dealings (Arrow, 1972 p344). A world of giving may improve efficiency because the price system does not always work. Experience has shown there are externalities in the supply of blood. These benefits and costs are transmitted among individuals for whom compensation in price terms is not and perhaps cannot be obtained. There is the example of hepatitis infection rates from commercial blood (Arrow, 1972 p351). In this respect truthfulness could contribute to the efficiency of the system because a voluntary system reinforces truthfulness (Arrow, 1972 p353). Some alternative system of determining quality and providing assurance for buyers is needed. One such would be a sense of social responsibility on the part of the seller.
Ethical behavior can be regarded as a socially desirable institution which facilitates the achievement of economic efficiency (Arrow, 1972 p354).
Ethical behavior should be confined to circumstances where the price system breaks down. It may not be wise to use the scarce resources of altruistic motivation. Ethically motivated behavior may even have a negative value to others if the agents act without sufficient knowledge of the situation. It may be argued that ethical codes serve as an instrument for increasing the economic advantage of one segment of the population at the expense of the rest (Arrow, 1972 p355). Arrow believes in the great importance of truthfulness in widely prevalent circumstances of economic life. Every commercial transaction has an element of trust, certainly any transaction conducted over a period of time. (Arrow, 1972 p356). Where price or quality is unknown, taking advantage is a classic case of exploitation. The price system must involve property rights. To the extant it is incomplete it must be supplemented by an implicit or explicit social contract. The categorical imperative and the price system are essential complements (Arrow, 1972 p357). An appeal against the market has a way of slipping into a defense of privilege (Arrow, 1972 p359). Titmuss wants to express a diffuse expression of confidence by individuals in the workings of a society as a whole. (Arrow, 1972 p360).
Arrow identifies three motives for giving blood; a generalized desire to benefit others, a feeling of social obligation and donations to known recipients. (Arrow, 1972 p348). In utility theory the welfare of the individual will depend on his satisfaction and on the satisfaction obtained by others. Varoufakis agrees this is part selfishness and part selflessness. (1998 p299-300) He says we enjoy the way we look in other people’s eyes. It is a creative act that loses its value if payment is received. The comfort of being useful as Scitovsky puts it. (1976 p120-121) He gives not in the hope of reciprocity but a strengthening of ties. He notes that beyond the circle of close friends and family giving can be seen as status seeking or buying acceptance. In Arrow’s utility theory the welfare of the individual will depend both on his satisfaction and on the satisfactions obtained by others. The welfare of each individual depends not only on the utilities of himself and others but also on his contributions to the utilities of others. Each individual is in some ultimate sense, motivated by purely egoistic satisfaction derived from the goods accruing to him, but there is an implicit social contract such that each performs duties for the other in a way calculated to enhance the satisfaction of all. (Arrow, 1972 p348)
Value introjections into economic action is socially oriented and guided by moral considerations. This is the acting out of collectively held values and may influence the character of personal goals and the selection of the means to accomplish them. (Portes, 1995 p4-5) The pursuit of material gain, when it interacts with other self-centered goals such as the quest for approval, status and power which depend on the opinion of others, commonly meets with the disapproval of others in the same social milieu. (Portes, 1995 p4-5) The unrestricted pursuit of gain is also constrained by reciprocity expectations built up in the course of social interaction. This web of expectations does not guarantee reciprocity but it insures the actors will go to some lengths to conceal the actions that carry the threat of sanctions. (Portes, 1995 p4-5) Monroe sees perspective as the difference between altruistic actions and giving. Altruists have a feeling of such strong links to humanity it leaves them no choice in their behavior when others are in great need. (Monroe, 1996 233-238) For her there is no element of self interest. Fogelman (1999) noticed in her interviews of 600 people who had helped Jews escape the Holocaust a majority had not come from secure childhoods of loving security. Instead they had been rescued by a guardian like figure at some point. She conjectures this as a significant indicator for future altruistic acts. It could be argued the failure of administrators to adequately monitor the quality of blood in a number of countries in the last decades implies the web of expectations about the quality of blood only inspired the concealment of irresponsibility. Perhaps the lack of leadership, frequently volunteers acting as trustees, from the top of these organizations contributed to the both the cover up and the extraordinary amount of time it has taken to get compensation for the victims of the tainted blood.
References

Arrow, Kenneth (1972) “Gifts and Exchanges,” Philosophy and Public Affairs, 1(4): 343-362.
Fogelman, E, (1999) Website accessed 23 June 2004 http://www.english.upenn.edu/~afilreis/Holocaust/rescuers-article.html
Portes, A (1995) ‘Economic Sociology of Immigration: A Conceptual Overview’ in The Economic Sociology of Immigration. Russel Sage Foundation. New York.
Scitovsky, Tibor (1976) The Joyless Economy, Oxford: Oxford University Press.
Swedberg, Richard (1990) Economics and Sociology: Redefining their Boundaries: Conversations with Economists and Sociologists, Princeton, N.J.: Princeton University Press.
Titmuss, Richard M. (1970) The Gift Relationship: From Human Blood to Social Policy, London: George Allen & Unwin Ltd. Chapters 1, 12, 13, 14.
Varoufakis, Y. (1998) Foundations of Economics: A beginner’s companion, London: Routledge.