vol 2: Synopsis
part V: Applied divinity
page 37: Economics
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This site is part of the natural religion project The natural religion project A new theology A commentary on the Summa The theology company
Economics
The root of effective religion is effective economics, since the dissipative nature of life requires that we must all consume to live. Although capital based means of production are excellent for generating wealth, they tend to fail in distribution. Good religion not only establishes the environment necessary for the creation of wealth, but makes certain that everyone has access to adequate resources for living, and seeks to minimise waste. It can move toward this goal by tuning political and economic systems according to principles derived from modelling and experience.
An industry is an organ of the body politic devoted to providing some common need. An industry comprises a large number of businesses. The sum of all the businesses and industries devoted to providing the goods we want is the economy. Much economic activity is local, but the spread of transport and communication networks means that many people can buy and sell around the world. Economics studies the structure and behavour of economies with a view to making them more stable and more productive.
As usual, we study systems by collecting information and making and playing with models, either in our minds, or with computers. Modelling requires some sort of measurement. For centuries now, economists have modelled their subject using money as the measure of value. In classical economic theory, the monetary value of any good is decided by a market. A market, if it is working properly, finds a balance between the individual and collective desires and choices of buyers and sellers.
Everybody buys and sells to increase their own wealth. For a given level of economic effort, the overall determinant of wealth is productivity, the yield of good per unit of effort. Economic management seeks to increase productivity by deprecating inefficient economic activity and promoting efficiency.
Feelings about what is efficient and what is valuable are partly determined by religious and political beliefs. Here we study these religious and political constraints on economics and seek to find a recipe for maximising wealth in manner consistent with humanity and justice. We suggest that the wealth of a community is a function not just of its total, but also of its creation, distribution and appreciation through the community.
We assume that the stability of a community is related to its power of dealing with problems as they arise. This power in turn depends on what proportion of the population have the resources and the will to actively contribute to the preservation of their community. Such resources relate, in turn, to the returns each individual gets from being a member of the community. If the rewards are perceived to be inadequate, people may be motivated to withdraw their support and secede from the economic and political organisation.
Books
| Bernstein, Peter L, The Power of Gold: The History of an Obsession, John Wiley and Sons 2000 'Bernstein's account of gold's past 20 years is particularly good - he was an executive at the Federal Reserce of New York, which handles foreign exchange for the Feneral Reserve system.' Anthony Vice, Nature 409:136 11 January 2001. Amazon back |
| Buchan, James, Frozen Desire: the meaning of money, Farar, Strauss and Giroux 1998 Jacket: 'In Buchan's view, money is civilization's greatest invention. ... As Buchan explains, money is "frozen desire" - and because money can fulfill any mortal purpose, for many people the pursuit of money becomes the point of life. In a learned and elegant survey, Buchan illuminates the many different views of money across the centuries. ... Whether or not money is humanity's greatest invention, its meanings reveal a great deal about human nature; in showing us what we think of money JB shows is who we are.' Amazon back |
| Hawken, Paul, and Amory B. Lovins, L. Hunter Lovins,, Natural Capitalism : Creating the Next Industrial Revolution, Little Brown and Company 1999 Traditional capitalism, the authors argue, has always neglected to assign monetary value to its largest stock of capital - namely the natural resources and ecosystem services that make possible all economic activity, and all life. Natural capitalism, in contrast, takes a proper accounting of these costs.' Amazon back |
| Keynes, John Maynard, The General Theory of Employment, Interest and Money, Macmillan 1936-1964 The classic twentieth century economics text that revealed that there are more ways to get an economy to grow than simply balancing the books.back |
| Levi, Margaret, Of Rule and Revenue, University of California Press 1988 Jacket: A magnificent book, one of the best blends of rational choice theory and historical analysis I've seen ... [Levi's] resolute focus throughout on rulers' efforts to balance extraction of revenues against the compliance of their polities organises this vast collection of material into a tight, compelling account.' Russell Hardin Amazon back |
| Schumacher, E F, Small is Beautiful: A Study of Economics as if People Mattered, Blond & Briggs 1998 'The most obvious facts are the most easily forgotten. Both the existing economic order and too many of the projects advanced for reconstructing it break down through their neglect of the truism that, since even quite common men have souls, no increase in material wealth will compensate them for arrangments which insult their self respect and impair their freedom. A reasonable estimate of economic organisation must allow for the facf that, unless industry is to be paralysed by recurrent revolts on the part of outraged human nature, it must satisfy criteria which are not purely economic' R H Tawney Religion and the Rise of Capitalism Amazon back |
| Smith, Adam, The Wealth of Nations: An Inquiry into the Nature and Causes, Modern Library 1994 First published 1776. The eighteenth century classic that laid the foundation for modern political economy. Here Smith descibes the work of the 'invisible hand' which guides a group of people freely acting in accord with their human nature to form an orderly and coherent social structure. The bible of laissez faire (let it be) capitalism. Amazon back |
| Wiles, Peter John de la Fosse, Economic Institutions Compared, Basil Blackwell 1977 Jacket: 'In this large and polymathic book, Professor Wiles looks at the various economic systems "with a dry eye, and at arm's length". His dispassionate analysis of how systems and institutions function and interact ecompasses the Advanced Capitalist Economy, The Soviet-type Economy, Underdeveloped countries and much more. This is perhaps the first textbook of its kind to deal fully and in context with the Yugoslav system, French Planning, Full Communism, the kibbutz, the hippie phenomenon.' Amazon back |
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Related sites:
Concordat Watch
Revealing Vatican attempts to propagate its religion by international treaty
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