Prudence

Prudence

Discussion
Ask a question about 'Prudence'
Start a new discussion about 'Prudence'
Answer questions from other users
Full Discussion Forum
 
Encyclopedia

Prudence is the ability to govern and discipline oneself by the use of reason. It is classically considered to be a virtue
Virtue
Virtue is moral excellence. A virtue is a positive trait or quality subjectively deemed to be morally excellent and thus is valued as a foundation of principle and good moral being....

, and in particular one of the four Cardinal virtues
Cardinal virtues
In Christian traditionthere are 4 cardinal virtues:*Prudence - able to judge between actions with regard to appropriate actions at a given time*Justice - proper moderation between self-interest and the rights and needs of others...

 (which are, with the three theological virtues
Theological virtues
Theological virtues - in theology and Christian philosophy, are the character qualities associated with salvation, resulting from the grace of God, which enlightens human mind.- In the Bible :The three theological virtues are:...

, part of the seven virtues
Seven virtues
In the Catholic catechism, the seven catholic virtues refer to the combination of two lists of virtues, the 4 cardinal virtues of prudence, justice, restraint or temperance, and courage or fortitude, and the 3 theological virtues of faith, hope, and love or charity ; these were adopted by the...

).

The word comes from Old French
Old French
Old French was the Romance dialect continuum spoken in territories that span roughly the northern half of modern France and parts of modern Belgium and Switzerland from the 9th century to the 14th century...

 prudence (14th century), from Latin
Latin
Latin is an Italic language originally spoken in Latium and Ancient Rome. It, along with most European languages, is a descendant of the ancient Proto-Indo-European language. Although it is considered a dead language, a number of scholars and members of the Christian clergy speak it fluently, and...

 prudentia (foresight, sagacity). It is often associated with wisdom
Wisdom
Wisdom is a deep understanding and realization of people, things, events or situations, resulting in the ability to apply perceptions, judgements and actions in keeping with this understanding. It often requires control of one's emotional reactions so that universal principles, reason and...

, insight
Insight
Insight is the understanding of a specific cause and effect in a specific context. Insight can be used with several related meanings:*a piece of information...

, and knowledge
Knowledge
Knowledge is a familiarity with someone or something unknown, which can include information, facts, descriptions, or skills acquired through experience or education. It can refer to the theoretical or practical understanding of a subject...

. In this case, the virtue is the ability to judge between virtuous and vicious actions, not only in a general sense, but with regard to appropriate actions at a given time and place. Although prudence itself does not perform any actions, and is concerned solely with knowledge, all virtues had to be regulated by it. Distinguishing when acts are courage
Courage
Courage is the ability to confront fear, pain, danger, uncertainty, or intimidation...

ous, as opposed to reckless
Recklessness (psychology)
Recklessness is disregard for or indifference to the dangers of a situation or for the consequences of one's actions....

 or cowardly
Cowardice
Cowardice is the perceived failure to demonstrate sufficient mental robustness and courage in the face of a challenge. Under many military codes of justice, cowardice in the face of combat is a crime punishable by death...

, for instance, is an act of prudence, and for this reason it is classified as a cardinal (pivotal) virtue.

Although prudence would be applied to any such judgment, the more difficult tasks, which distinguish a person as prudent, are those in which various goods have to be weighed against each other, as when a person is determining what would be best to give charitable donations, or how to punish a child so as to prevent repeating an offense.

In modern English
English language
English is a West Germanic language that arose in the Anglo-Saxon kingdoms of England and spread into what was to become south-east Scotland under the influence of the Anglian medieval kingdom of Northumbria...

, however, the word has become increasingly synonymous with cautiousness. In this sense, prudence names a reluctance to take risks, which remains a virtue with respect to unnecessary risks, but when unreasonably extended (i.e. over-cautiousness), can become the vice
Vice
Vice is a practice or a behavior or habit considered immoral, depraved, or degrading in the associated society. In more minor usage, vice can refer to a fault, a defect, an infirmity, or merely a bad habit. Synonyms for vice include fault, depravity, sin, iniquity, wickedness, and corruption...

 of cowardice.

In the Nicomachean Ethics
Nicomachean Ethics
The Nicomachean Ethics is the name normally given to Aristotle's best known work on ethics. The English version of the title derives from Greek Ἠθικὰ Νικομάχεια, transliterated Ethika Nikomacheia, which is sometimes also given in the genitive form as Ἠθικῶν Νικομαχείων, Ethikōn Nikomacheiōn...

, Aristotle
Aristotle
Aristotle was a Greek philosopher and polymath, a student of Plato and teacher of Alexander the Great. His writings cover many subjects, including physics, metaphysics, poetry, theater, music, logic, rhetoric, linguistics, politics, government, ethics, biology, and zoology...

 gives a lengthy account of the virtue phronesis
Phronesis
Phronēsis is an Ancient Greek word for wisdom or intelligence which is a common topic of discussion in philosophy. In Aristotelian Ethics, for example in the Nicomachean Ethics it is distinguished from other words for wisdom as the virtue of practical thought, and is usually translated "practical...

 (Greek: ϕρονησιϛ), which has traditionally been translated as "prudence", although this has become increasingly problematic as the word has fallen out of common usage. More recently ϕρονησιϛ has been translated by such terms as "practical wisdom
Phronesis
Phronēsis is an Ancient Greek word for wisdom or intelligence which is a common topic of discussion in philosophy. In Aristotelian Ethics, for example in the Nicomachean Ethics it is distinguished from other words for wisdom as the virtue of practical thought, and is usually translated "practical...

", "practical judgment," or "rational choice."

Prudence as the "Father" of all virtues



Prudence was considered by the ancient Greeks
Ancient Greece
Ancient Greece is a civilization belonging to a period of Greek history that lasted from the Archaic period of the 8th to 6th centuries BC to the end of antiquity. Immediately following this period was the beginning of the Early Middle Ages and the Byzantine era. Included in Ancient Greece is the...

 and later on by Christian philosophers
Christian philosophy
Christian philosophy may refer to any development in philosophy that is characterised by coming from a Christian tradition.- Origins of Christian philosophy :...

, most notably Thomas Aquinas
Thomas Aquinas
Thomas Aquinas, O.P. , also Thomas of Aquin or Aquino, was an Italian Dominican priest of the Catholic Church, and an immensely influential philosopher and theologian in the tradition of scholasticism, known as Doctor Angelicus, Doctor Communis, or Doctor Universalis...

, as the cause, measure and form of all virtues. It is considered to be the auriga virtutum or the charioteer of the virtues.

It is the cause in the sense that the virtues, which are defined to be the “perfected ability” of man as a spiritual person (spiritual personhood in the classical western understanding means having intelligence
Intelligence
Intelligence has been defined in different ways, including the abilities for abstract thought, understanding, communication, reasoning, learning, planning, emotional intelligence and problem solving....

 and free will
Free will
"To make my own decisions whether I am successful or not due to uncontrollable forces" -Troy MorrisonA pragmatic definition of free willFree will is the ability of agents to make choices free from certain kinds of constraints. The existence of free will and its exact nature and definition have long...

), achieve their "perfection" only when they are founded upon prudence, that is to say upon the perfected ability to make right decisions. For instance, a person can live temperance
Temperance (virtue)
Temperance has been studied by religious thinkers, philosophers, and more recently, psychologists, particularly in the positive psychology movement. It is considered a virtue, a core value that can be seen consistently across time and cultures...

 when he has acquired the habit of deciding correctly the actions to take in response to his instinctual cravings.

With limited of physical human body,because human body have flaws,(Ex.limited of life span,can die,for example.)
Only "God" is perfection,flawless and human always have flaws.
So can say,inanother hand,"there is no perfection without modesty",and with modesty will never accept 100 perfect scores,but 99 scores only to preserve modesty,so pursuit of perfection (the moral excellence) in another hand.

Prudence is considered the measure of moral virtues since it provides a model of ethically good actions. "The work of art is true and real by its correspondence with the pattern of its prototype in the mind of the artist. In similar fashion, the free activity of man is good by its correspondence with the pattern of prudence." (Josef Pieper
Josef Pieper
Josef Pieper was a German Catholic philosopher, at the forefront of the Neo-Thomistic wave in twentieth century Catholic philosophy. Among his most notable works are The Four Cardinal Virtues: Prudence, Justice, Fortitude, Temperance; Leisure: the Basis of Culture; The Philosophical Act and Guide...

) For instance, a stock broker
Stock broker
A stock broker or stockbroker is a regulated professional broker who buys and sells shares and other securities through market makers or Agency Only Firms on behalf of investors...

 using his experience and all the data available to him decides that it is beneficial to sell stock A at 2PM tomorrow and buy stock B today. The content of the decision (e.g., the stock, amount, time and means) is the product of an act of prudence, while the actual carrying out of the decision may involve other virtues like fortitude (doing it in spite of fear of failure) and justice (doing his job well out of justice to his company and his family). The actual act’s “goodness” is measured against that original decision made through prudence.

In Greek and Scholastic philosophy, "form" is the specific characteristic of a thing that makes it what it is. With this language, prudence confers upon other virtues the form of its inner essence; that is, its specific character as a virtue. For instance, not all acts of telling the truth are considered good, considered as done with the virtue of honesty. What makes telling the truth a virtue is whether it is done with prudence. Telling a competitor the professional secrets of your company is not prudent and therefore not considered good and virtuous.

Prudence versus cunning and false prudence


In the Christian understanding, the difference between prudence and cunning lies in the intent with which the decision of the context of an action is made. The Christian understanding of the world includes the existence of God
God
God is the English name given to a singular being in theistic and deistic religions who is either the sole deity in monotheism, or a single deity in polytheism....

, the natural law
Natural law
Natural law, or the law of nature , is any system of law which is purportedly determined by nature, and thus universal. Classically, natural law refers to the use of reason to analyze human nature and deduce binding rules of moral behavior. Natural law is contrasted with the positive law Natural...

 and moral
Morality
Morality is the differentiation among intentions, decisions, and actions between those that are good and bad . A moral code is a system of morality and a moral is any one practice or teaching within a moral code...

 implications of human actions. In this context, prudence is different from cunning in that it takes into account the supernatural good. For instance, the decision of persecuted Christians to be martyr
Martyr
A martyr is somebody who suffers persecution and death for refusing to renounce, or accept, a belief or cause, usually religious.-Meaning:...

ed rather than deny their faith is considered prudent. Pretending to deny their faith could be considered prudent from the point of view of a non-believer.

Judgments using reasons for evil ends or using evil means are considered to be made through “cunning” and “false prudence” and not through prudence.

Integral Parts of Prudence


"Integral parts" of virtues, in Scholastic philosophy
Scholasticism
Scholasticism is a method of critical thought which dominated teaching by the academics of medieval universities in Europe from about 1100–1500, and a program of employing that method in articulating and defending orthodoxy in an increasingly pluralistic context...

, are the elements that must be present for any complete or perfect act of the virtue. The following are the integral parts of prudence:
  • Memoria
    Memoria
    Memoria was the term for aspects involving memory in Western classical rhetoric. The word is Latin, and can be translated as "memory."It was one of five canons in classical rhetoric concerned with the crafting and delivery of speeches and prose.The art of rhetoric grew out of oratory, which was...

     — Accurate memory; that is, memory that is true to reality
  • Intelligentia — Understanding of first principles
  • Docilitas — The kind of open-mindedness that recognizes the true variety of things and situations to be experienced, and does not cage itself in any presumption of deceptive knowledge; the ability to make use of the experience and authority of others to make prudent decisions
  • Shrewdness or quick-wittedness (solertia) — sizing up a situation on one's own quickly
  • Discursive reasoning (ratio) — research and compare alternative possibilities
  • Foresight (providentia
    Providentia
    In ancient Roman religion, Providentia is a divine personification of the ability to foresee and make provision. She was among the embodiments of virtues that were part of the Imperial cult of ancient Rome. Providentia thus figures in art, cult, and literature, but has little or no mythology as...

    ) — capacity to estimate whether a particular action will lead to the realization of our goal
  • Circumspection — ability to take all relevant circumstances into account
  • Caution — risk mitigation

Prudential judgments


In ethics, a "prudential judgment" is one where the circumstances must be weighed to determine the correct action. Generally, it applies to situations where two people could weigh the circumstances differently and ethically come to different conclusions.

For instance, in Just War
Just War
Just war theory is a doctrine of military ethics of Roman philosophical and Catholic origin, studied by moral theologians, ethicists and international policy makers, which holds that a conflict ought to meet philosophical, religious or political criteria.-Origins:The concept of justification for...

 theory, the government of a nation must weigh whether the harms they suffer are more than the harms that would be produced by their going to war against another nation that is harming them; the decision whether to go to war is therefore a prudential judgment.

In another case, a patient who has a terminal illness with no conventional treatment may hear of an experimental treatment. To decide whether to take it would require weighing on one hand, the cost, time, possible lack of benefit, and possible pain, disability, and hastened death, and on the other hand, the possible benefit and the benefit to others of what could be learned from his case.

Prudence in economics


Economists say that a consumer is 'prudent' if he or she saves more when faced with risk
Risk
Risk is the potential that a chosen action or activity will lead to a loss . The notion implies that a choice having an influence on the outcome exists . Potential losses themselves may also be called "risks"...

ier future income. This additional saving is called precautionary saving. Prudence is closely related to risk aversion
Risk aversion
Risk aversion is a concept in psychology, economics, and finance, based on the behavior of humans while exposed to uncertainty....

. The difference is that saying a consumer is risk averse merely implies that he or she dislikes facing risk, whereas prudence implies that the consumer takes action to offset the effects of the risk (namely, by increasing saving).

If a risk averse consumer has a utility function  over consumption x, and if is differentiable
Derivative
In calculus, a branch of mathematics, the derivative is a measure of how a function changes as its input changes. Loosely speaking, a derivative can be thought of as how much one quantity is changing in response to changes in some other quantity; for example, the derivative of the position of a...

, then the consumer is not prudent unless the third derivative
Derivative
In calculus, a branch of mathematics, the derivative is a measure of how a function changes as its input changes. Loosely speaking, a derivative can be thought of as how much one quantity is changing in response to changes in some other quantity; for example, the derivative of the position of a...

 of utility is positive, that is, .

The strength of the precautionary saving motive can be measured by absolute prudence, which is defined as
. Similarly, relative prudence is defined as absolute prudence, multiplied by the level of consumption. These measures are closely related to the concepts of absolute and relative risk aversion
Risk aversion
Risk aversion is a concept in psychology, economics, and finance, based on the behavior of humans while exposed to uncertainty....

 developed by Kenneth Arrow
Kenneth Arrow
Kenneth Joseph Arrow is an American economist and joint winner of the Nobel Memorial Prize in Economics with John Hicks in 1972. To date, he is the youngest person to have received this award, at 51....

 and John W. Pratt
John W. Pratt
John W. Pratt is Emeritus William Ziegler professor business administration at Harvard University. He has made contributions to research in risk aversion theory, notably with Kenneth Arrow on measures of risk aversion....

.

Prudence in accounting


In accounting, prudence was long considered one of the fundamental accounting concepts, determining the time for revenue recognition
Revenue recognition
The revenue recognition principle is a cornerstone of accrual accounting together with matching principle. They both determine the accounting period, in which revenues and expenses are recognized...

. The rule of prudence meant that gains should not be anticipated unless their realisation was highly probable. However, recent developments in Generally Accepted Accounting Principles
Generally Accepted Accounting Principles
Generally Accepted Accounting Principles refer to the standard framework of guidelines for financial accounting used in any given jurisdiction; generally known as accounting standards...

 have led academic critics to accuse the international standard-setting body IASB of abandoning prudence. In the British reporting standard FRS 18, prudence, along with consistency, was relegated to a "desirable" quality of financial information rather than fundamental concept. Prudence was rejected for IFRS because it was seen as introducing bias to accounts, which should be neutral.

In a 2011 report on the late-2000s financial crisis
Late-2000s financial crisis
The late-2000s financial crisis is considered by many economists to be the worst financial crisis since the Great Depression of the 1930s...

, the British House of Lords
House of Lords
The House of Lords is the upper house of the Parliament of the United Kingdom. Like the House of Commons, it meets in the Palace of Westminster....

 bemoaned the demotion of prudence as a governing principle of accounting and audit
Financial audit
A financial audit, or more accurately, an audit of financial statements, is the verification of the financial statements of a legal entity, with a view to express an audit opinion...

. However, their comments were disputed by some leading practitioners.

External links