Posts tagged with: economics

Blog author: jballor
posted by on Monday, February 15, 2010

Longtime Acton friend John H. Armstrong notes the recent discussion of Rowan Williams’ pronouncements on ethics and the economy here at the PowerBlog, commenting that “The archbishop of Canterbury is an extremely likable Christian gentleman, a first-class Christian scholar. He is also a leader who often fails to address some of the more difficult issues in our time with a straight, clear answer.”

Armstrong’s description of Williams coheres well with the overall picture of theologians engaging economics presented by Susan Lee, who says, “The habit of picking and choosing means that many theological discussions of economics take place under a cloud of incoherence, or at least to economists, ignorance.”

In this brief piece from APM’s Marketplace, “Bridging the theology-economy gap.” Susan Lee, “an economist and a theologian based in New York City,” passes along her experience at a public appearance that included Rowan Williams. She gets of some real substantive observations, including the following:

…ethics are the common ground for theology and economics…

Both theologians and economists are interested in improving the lives of all humans. Both groups agree on policy goals like low unemployment and sustainable growth. In fact, these goals are in harmony with a definition offered by the archbishop. He said: “An ethical economy is one where we care for our neighbor by creating conditions so the most vulnerable aren’t abandoned.” Well, this is a description of capitalism in the U.S….

Economists are interested in how to make the pie larger. Theologians are interested in how to divide the pie. And so many theologians treat capitalism like a Chinese menu. They pick the wealth-distribution parts and discard the wealth-creation parts….

Her commentary is brief, but worth reading or listening to in full. Jeff Walton at the IRD also provides some background for the Trinity Institute event, and includes fuller observations from Lee (HT).

Camarin M. Porter of the Department of History at University of Wisconsin-Madison reviews a text edited by Stephen J. Grabill, Sourcebook in Late-Scholastic Monetary Theory: The Contributions of Martin de Azpilcueta, Luis de Molina, and Juan de Mariana (Lexington, 2007). The review appears courtesy of H-Net, a unique and indispensable set of list-servs hosted by Michigan State University.

The Sourcebook includes translations into English of selected texts from the significant figures listed in the book’s subtitle, as well as a general introduction by Grabill and specialized introductions for each text: Azpilcueta’s Commentary on the Resolution of Money (1556), Molina’s Treatise on Money (1597), and Mariana’s Treatise on the Alteration of Money (1609).

In this extensive review, Porter writes, “For each of the three texts, the Sourcebook efficiently accomplishes its goal of setting each authors’ specific concerns in areas of moral theology and economics within full social and intellectual contexts.”

I think the country IS discovering its inner Dave Ramsey. The savings rate keeps going up.

People are self-consciously trying to protect themselves from uncertainty. At first, it was to protect against a private sector meltdown. Now, it is an attempt to protect against public sector profligacy.

In both cases, this new found habit of saving keeps the economic motor running slow and low. Government attempts to overcome that instinct are bound to fail. The only thing that will loosen up wallets will be if citizens sense that economic growth has a real basis rather than a “the government commands it so” one.

Some of the aspects of the movement in ‘new economics’ highlighted by Sumita Kale sound quite promising. For instance, it is true that “many issues of economic policy (traditionally called ‘welfare economics’) are primarily ethical-economics in nature, and should be informed by moral philosophy rather than economics in isolation.” The growing conversation between economics and other disciplines, specifically moral philosophy and theology, is most welcome.

Indeed, some of the principles animating the work of the Cambridge Trust for New Thinking in Economics sound similar notes: “economic behaviour is influenced by aesthetic and ethical values as well as economic values.”

But when we drill down to the objectives of the Trust and look at some of the other principles, it becomes clearer that what is “new” about “new economics” is that economic research is pursued with an overtly and explicitly socio-political agenda: “It is vital that two social problems be solved. The first is the obvious degradation of the planet and its atmosphere by over-consumption and over-production through the exploitation of resources in pursuit of monetary gain. The second problem is the toxic pollution of the global money supply, also obvious, caused by financial practices over the past twenty years, led by the investment banks of Wall Street and the City of London.”

What we have here is economics as social engineering, providing norms for behavior rather than describing it. “New” economics (traditional economics with just a dash of moral philosophy thrown in) becomes a prescriptive rather than a descriptive discipline, and therefore simply one more voice among many clamoring for dominance in the legislative process.

Blog author: jballor
posted by on Monday, November 23, 2009

Contrary to the belief of some, the two realities referred to in the title of this post are not identical.

But the discussion around a recent Boston Globe article reminds me of the saying from Jerry Taylor, a senior fellow at the Cato Institute, “Capitalism without the threat of bankruptcy is like Christianity without the threat of hell. It doesn’t work very well.” It may well be that capitalism without the threat of hell doesn’t work very well either.

The Globe piece refers to a bit of research that links belief about punishment in the afterlife with economic development. This is important, since “knowing exactly how and when God influences mammon could lead to smarter forms of economic development in emerging nations, and could add to our understanding of how culture shapes wealth and poverty.”

It is promising that there is “a larger movement in economics, in which the field is looking beyond purely material explanations to a broader engagement with human culture, psychology, and even our angels and demons.”

Blog author: jballor
posted by on Wednesday, October 21, 2009

The Workshop in Political Theory and Policy Analysis at Indiana University has announced the launch of a new initiative focused on the thought of Alexis de Tocqueville.

The Tocqueville Program aims “to foster an understanding of the central importance of principles of freedom and equality for democratic government and moral responsibility, as well as for economic and cultural life.”

The program’s first event will be held next month (November 6), and is titled, “What’s Wrong with Tocqueville Studies, and What Can Be Done About It.”

IU professor Elinor Ostrom, the most recent winner of the Nobel Prize in economics, co-founded the Workshop in Political Theory and Policy Analysis.

In his book Elements of Justice (reviewed in the Journal of Markets & Morality here), University of Arizona philosophy and economics professor David Schmidtz introduces the idea of desert not simply as a compensatory notion, but also as including a promissory aspect. That is, what we deserve isn’t always about only what we have done. There might be a real sense in which what we do after an opportunity provides a kind of retroactive justification for having been given a chance.

There has been a flurry of negative reaction to the naming of President Obama as the recipient of this year’s Nobel Peace Prize. Even those in the mainstream media, considered by many to be rabidly pro-Obama, have noted that the committee must have been attempting to reward intentions rather than results.

Speaking of the concept of desert, Schmidtz writes that “what it needs to be in human affairs” is “a message of hope that is at the same time life’s greatest moral challenge.” It seems patently obvious that Obama does not deserve the Nobel Peace Prize according to any kind of compensatory calculus. The only even apparently viable justification, even if inadequate in the case of a prize like this, is promissory.

Others have noted what it might look like if potential starts becoming a valuable part of award formula. While the committee awarded the Nobel Prize in Economics this year to Elinor Ostrom and Oliver Williamson, Greg Mankiw made the case for the potential and promise present in a first-year econ grad student.

More seriously, Francis Beckwith points out how the concept of “potential” fails to be applied where it is most deserved: in the case of the unborn.

We welcome a new contributor to the Acton Commentary crew: Dr. Dwight R. Lee, the William J. O’Neil Endowed Chair in Global Markets and Freedom at Southern Methodist University. In this week’s commentary, Lee discusses how the social objectives of clergy and economists are remarkably similar, even though their “windows on the world” suggest different approaches to achieving the shared aim of building a better, more humane society. This week’s commentary is adapted from an article to be published in the Journal of Markets & Morality (Vol. 12, No. 2; Fall 2009). Excerpt:

My hope is that members of the clergy, in their desire to achieve a better world, will begin to see economists as allies instead of adversaries. This hope may be dismissed as preposterous by some since, as an economist, I argue that market incentives are the most effective way of achieving many of the social outcomes most of the clergy favor. But those most opposed to market incentives for achieving desirable objectives have the most to gain by taking a look through the economic window. Much of the skepticism, indeed hostility, towards markets is based on distorted and mistaken views of how markets operate and what they accomplish.

Religious differences notwithstanding, most people respect the clergy for their noble objectives and effort to achieve those objectives by encouraging and celebrating “the better angels of our nature” mentioned in Abraham Lincoln’s first inaugural address. Most approve of the clergy’s concern with encouraging behavior such as sharing with, and serving the interests of, others; helping the poor; sacrificing for the good of the wider community; acting as good stewards of the earth’s resources; being concerned with protecting the environment; and generally living a life that promotes social cooperation and harmony.

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The Surprising Life of a Medieval EmpireThe Oxford Handbook of Byzantine Studies. Edited by Elizabeth Jeffreys, John Haldon, Robin Cormack. Oxford University Press (2008)

Byzantium: The Surprising Life of a Medieval Empire by Judith Herrin. Princeton University Press (2008)

Ask the average college student to identify the 1,100 year old empire that was, at various points in its history, the political, commercial, artistic and ecclesiastical center of Europe and, indeed, was responsible for the very survival and flourishing of what we know today as Europe and you’re not likely to get the correct answer: Byzantium.

The reasons for this are manifold but not least is that as Western Europe came into its own in the later Middle Ages and Renaissance, Byzantium gradually succumbed piecemeal to the constant conquering pressure of Ottomans and Arabs. When Constantinople finally fell in 1453 (two years after the birth of the Genoese Christopher Columbus), Europe, now cut off from many land routes to Asian trade, was already looking West and South in anticipation of the age of exploration and colonization. Byzantium, and the Christian East, would fall under Muslim domination and dhimmitude for centuries and its history would fade away before the disinterest, or ignorance, of the West.

This “condemnation to oblivion” as the editors of The Oxford Handbook of Byzantine Studies, describe it, is “no longer quite so true as it once was.” New exhibitions of Byzantine art in Europe and America have been hugely successful in recent years and travel to cities with Byzantine landmarks and archeological sites in Greece, Turkey and the Balkans is easier than ever. Academic centers throughout western Europe and the United States host Byzantine Studies departments, scholarly journals proliferate, and a new generation of scholars has elevated the field from what once was a narrow specialty.

The Oxford Handbook of Byzantine Studies is a useful, one volume reference work that would well serve both the scholar and general reader with an interest in Byzantine culture. The editors have prefaced the volume with a detailed assessment of the Discipline, the state of scholarly learning on everything from art history to weights and measures. Other sections examine Landscape, Land Use, and the Environment; Institutions and Relationships (including the economy); and The World Around Byzantium. Each of the nearly two dozen subheadings include concise chapters with references and suggestions for further readings.

For those interested in the economic life of Byzantium, the Handbook offers an account in Towns and Cities that describes agricultural, commercial and industrial activity, and charts a decline in these areas during periodic invasions by various waves of Slav, Avar, Persian and Ottoman peoples, or bouts of the plague. Where political and military fortunes turned favorable, as in the 8th and 9th centuries, economic life enjoyed a parallel revival. Regional cities became economic centers, places like Thessalonike, Thebes (silk textiles) and Corinth, where glass, pottery, metals and textiles were produced. In his chapter on the Economy, Alan Harvey relates how Constantinople, in the 12th Century, “was clearly a bustling city with a wide range of skilled craftsmen, merchants, artisans, petty traders. There was also a transient population of various nationalities, in addition to the more settled presence of Italian merchants.”

And, because it was a Christian empire, the Handbook has a lot to say about the Byzantine Church, its relations with the Empire, and its developing rivalry with Rome, especially as the papal reform movement took hold in the 11th century. The Emperor and Court chapter in the Handbook should also go some way toward a better understanding of “late ancient state formation,” a subject the editors say has received “remarkably little attention” by historians and political theorists.

Writing in the Handbook’s summary chapter, Cyril Mango catalogs the achievements of Byzantium but also adds that historians have not “credited [the empire] with any advance in science, philosophy, political theory, or having produced a great literature.” Maybe the Byzantines had other ambitions. James Howard-Johnston asserts that the “ultimate rationale” of Byzantium’s existence was its “Christian imperial mission.”

That conviction, widely shared in a thoroughly Orthodox society, was the shaping influence on its foreign policy. It provides the basic, underlying reason for Byzantium’s tenacious longetivity, for its stubborn resistance in the opening confrontation with Islam, and, even more extraordinary, for the resilience shown in the last three and half centuries of decline.

For the general reader, perhaps a better place to begin to illuminate the “black hole” of Byzantine history is Judith Herrin’s fine book, Byzantium: The Surprising Life of a Medieval Empire. A senior research fellow in Byzantine Studies at King’s College London, Herrin sets out to trace the period’s “most significant high points as clearly and compellingly as I can; to reveal the structures and mentalities which sustained it.” Her aim is to help the reader understand “how the modern western world, which developed from Europe, could not have existed had it not been shielded and inspired by what happened further to the east in Byzantium. The Muslim world is also an important element of this history, as is the love-hate relationship between Christendom and Islam.”

Byzantium’s ability to conquer, Herrin writes, and “above all, to defend itself and its magnificent capital was to shield the northwestern world of the Mediterranean during the chaotic but creative period that followed the collapse of the Roman Empire in the West. Without Byzantium there would have been no Europe.” (more…)

A Caritas in Veritate Reader

In response to the ongoing interest in Pope Benedict’s new encyclical, the Acton Institute is readying the publication of Caritas in Veritate — A Reader.

This encyclical, in all of its remarkable depth, will no doubt be the subject of thoughtful analysis for a long time to come. Later this summer, Acton will gather the best of its own commentary on Caritas and selected articles from other observers in a single volume that will be available in hard copy and in a digital format. We trust that this Reader will serve as a guide to understanding the encyclical and the thinking of Pope Benedict on important social questions. We’ll update you with information on how to purchase or download the Reader as we get closer to the publication date.