The Entanglement between Self-interest and Public Interest

Author: Hsiung Bing-yuan Posted on Oct 21, 2009, Apple Daily

Translator: Welson Xiong (Oct 25, 2009)

In Chinese society, the subtle relationships between public sphere and private sphere have been discussed in a number of treatises. For example, incivism, which has been recognized as the common fault in Chinese community (including mainland China, Hong Kong and Taiwan). However, there are two additional familiar phenomena are seldom read in a written text.

On the one hand, the traditional education repeatedly stresses that the purpose for what one has learned from books of ancient Chinese sages is to regulate one’s family, govern the nation and bring the peace to the world; that the principium of being a Gentleman is to forget one’s own affairs for the sake of public affairs; and that while it is impossible to reconcile both loyalty and filial piety, one should be loyal to his country rather than be a filial son. A foregone conclusion: while personal affairs meet public affairs, the former should normally give priority to the latter. On the other hand, signed by the official seal, numerous official documents bear no name of person in charge, thus what people could face is just the cold, void and abstract name of a public institution. Also, lots of letters from readers have no signature either. It seems being afraid to have their names exposed, and shows a bit shady self-consciousness.

The coexistence of these strange and even conflicting phenomena seemly reflect in Chinese culture the deficiency of a healthy and affirmative awareness for their both treatments and relative relationships of public and private affairs. Assuming that human beings are rational (capable of thinking) and self-interested (pursuing their recognized well-being), the rudiments of economics might perhaps provide a little help to resolve the problem between public interest and self-interest.

Several common misconceptions are worth to be clarified in advance. First of all, both self-interest and public interest are conflicting and incompatible with each other. For this intuitive awareness, let the evidence speaks for itself: a bottle of milk, whose cost is 30 dollars(NT), is sold 50 dollars; (assuming that) the consumer who bought it earns 80-dollar pleasure. Therefore, the seller and the buyer, though seeking their respective benefit, could mutually profit by trading; the well-being of both sides increases “simultaneously,” and the rights and interests of both sides “are“ treated equally, so self-interest and public interest also concurrently risen.

Secondly, public interest could not be compared with its amount because it is unquantifiable. Ordinary people would not commit this kind of error, but occasionally it does happen to some learned scholars who read books in a priggish manner. Surely public interest could differ in types just as the interest has various amounts. Student interests (a kind of public interest) among primary schools, primary and secondary schools, and all schools, even including all the faculties and students interests, definitely vary in their specific scopes, ranging from small to large sizes. Moreover, the values of size, beauty or ugliness, and right or wrong, etc. are an ordering concept; series figures of 1,2,3,4, etc. are a numerical concept. The size of public interest is relevant to ordering, but has no direct correlation with quantification. In fact, the procedure of democratic representation is designed for the decision-making between public interest and self-interest.

Public Interest—Overlapping Part of Multiple Self-interests

Thirdly, self-interest, once running into public interest, should make a concession to it. This illusion deserves a careful discretion. During the competitive conflict, public interest and self-interest are just like two ends of a scale. What their priorities are depend on other interrelated conditions. Take Japanese Narita Airport for example, its construction triggered violent protests from nearby residents, and finally, the airport changed its design, shortened its runway and switched its runway’s direction. Correspondingly, the airport operating capacity, including its airplane taking off and landing, has made a huge and uncountable cost increase. As long as the airport keeps on its operation for one day, Japanese future generations would have to assume these costs for one more day.

The above case shows that in the conflict between self-interest and public interest, if self-interest (people's property rights) surpasses public interest (airport operations, passenger rights, etc.), public interest gives in. Of course, at the abstract level, respect for private property itself is a kind of public interest. In the long term, the stability of private property is far beyond the gain and loss of an airport!

This transition, in fact, touches the most fundamental and the most crucial problem of public interest and self-interest. What on earth the relevance between them? The answer in the final analysis is quite simple: public interest is composed of multiple self-interests; the common overlapping part of self-interests is public interest. Therefore, a bachelor's interest is self-interest; the common interest of the husband and wife after marriage is public interest owned by both of them; the common interest among the couple, their children and relatives is the family’s public interest…... and etc.

Ronald Harry Coase, Nobel Prize winner, is best known for two awarded articles in particular, one of which is “The Problem of Social Cost.” The major idea of the article, summarized up in one word, is that there is no so-called social cost, only private cost.

For the problem between self-interest and public interest, one might also think it in the same way. Although it is quite an extreme description, yet it goes right down to the heart of the matter!

The author is now Professor in the Institute & Department of Economics, National Taiwan University, and Lukang Consultant.