| Summary: | Proportionate Reciprocity, Modesty, and Democracy, are the key concepts in Aristotle’s economics of exchange. The following correspondence of these concepts with modern social science may be contemplated: (a) Ideally, reciprocal justice in bilateral bargaining to minimize expenditure given utility levels results in Pareto-efficient, envy-free, equitable outcomes. (b) Practically, bargaining under the threat or actual recontracting may act as a surrogate of reciprocal justice, leading to an N-person contract topology. (c) But, recontracting is subject to practical limitations too, in which case near-reciprocal justice/general equilibrium outcomes may be fostered if, as a surrogate of recontracting, modesty in interaction is exhibited in an evolutionarily-stable-strategy fashion. (d) That is, incomplete recontracting amounts to asymmetric agent-type information, which in turn lays the ground for injustices; the same lack of information prevents rectificatory justice from being efficient and hence, modesty can be efficient only if it operates as a social norm and hence, only in a modest polity, which can be no other than democracy.
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