How John Rawls Could Support the Contract Theory

by Dr. Jan Garrett

March 14, 2005

This web page presupposes familiarity with: John Rawls' Theory of Justice

The two most important middle-level theories that govern interactions between manufacturers and marketers are: (1) the Contract Theory and (2) the Due Care Theory. (These two theories are systematically presented in Manuel Velasquez, Business Ethics: Concepts and Cases [Prentice-Hall], chapter 6.)

In brief, the Contract Theory states that manufacturers and marketers must follow four duties in relation to the buyer. They must fully disclose the nature of the product or service; they must not misrepresent the product or service; they must not coerce the prospective buyer into agreeing to the sale; and finally, once the contract is agreed to, there is a duty to comply with the terms of the contractual agreement.

The principle of fidelity (a term which Rawls gets from W. D. Ross) is a principle that requires us to be honest, to keep promises, and to comply with contracts voluntarily made. "The principle of fidelity," says Rawls (344), "is but a special case of the principle of fairness applied to the social practice of promising. . . ."

Rawls continues,

The way in which the rule of promising specifies the appropriate circumstances and excusing conditions determines whether the practice it represents is just. For example, in order to make a binding promise, one must be fully conscious, in a rational frame of mind, and know the meaning of the operative words ["I promise to do X"], their use in making promises, and so on. Furthermore these words must be spoken freely or voluntarily, when one is not subject to threats or coercion, and in situations where one has a reasonably fair bargaining position, so to speak. A person is not required to perform if the operative words were uttered while he is asleep, or suffering delusions, or if he was forced to promise, or if pertinent information was deceitfully withheld from him. In general, the circumstances giving rise to a promise and the excusing conditions must be defined so as to preserve the equal liberty of the parties and to make the practice a rational means whereby men can enter into and stabilize cooperative agreements for mutual advantage. (345)

Thus we see that the Contract Theory receives general endorsement from Rawls. In effect, the Contract Theory can be seen as a restatement of the principle of fidelity, which in turn is an application of the principle of fairness, which in turn (along with the two basic principles of justice) would be endorsed from the original position.

1. Representative persons in the Original Position would acknowledge:
a. The Two Principles of Justice
b. The Principle of Fairness (the Bridge Principle).
2. The application of the latter to promising generates:
The Principle of Fidelity
3. The Principle of Fidelity, applied to the double promise of a contract, generates:
Contract Theory
The Contract Theory is endorsed by Rawls only "for the most part." Should it turn out that the result of numerous apparently free contractual exchanges violates the basic two principles of justice, the Contract Theory could not be endorsed without further qualification. In other words, should a system of pure contractual exchanges violate these principles, additional constraints might need to be added to correct for the social injustice that has emerged.

One obvious area in which the Contract Theory would be limited by Rawls' two principles of social justice is slavery. In a slave-owning society slaves are typically bought and sold on the market and thus are the subjects of contractual arrangements. But this application of contracting violates the basic principle of Equal Basic Liberty because it is implied in this principle that freedom from slavery is a basic liberty not to be violated.