Abstract
Economic doctrine is interested in the efficient use of resources for production and consumption. It often uses mathematical and geometric arguments in order to speak authoritatively. Catholic Social Thought and most religious ethics are more directly concerned with what the economy does to people, particularly to the poor. These traditions use the message of sacred texts or moral reasoning to make authoritative demands. I will demonstrate that, notwithstanding their different methods and interests, there are important areas where these different discourses about the economy acknowledge each other’s authority. I will begin by emphasizing the obvious difference between these two discourses about the economy and end by pointing to multiple forms of overlapping concerns.
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References
For a recent article questioning the general validity of the Phillips curve and the proposition that minimum wage legislation necessarily increases unemployment, see Prasch & Sheth 1999.
For an enumeration of these and other assumptions see Bator 23.
Thornstein Veblen is famous for his description of the phenomenon of conspicuous consumption. This leads to a phenomenon known to happen in up-scale stores: a product does not sell well at a particular price but sells much better when the price is doubled. Veblen explains this phenomenon by pointing out that a conspicuous consumer does not so much enjoy the intrinsic qualities of a good as the knowledge that the good is expensive. The logic behind the phenomenon seems to be that the conspicuous consumer feels the more important the more expensive the good is that he or she is consuming. Goods that sell more when the price is increased are said to be subject to the Veblen effect (Veblen 1934).
The publications of Arrow and Debreu have proven this insight mathematically (Arrow & Debreu 1954).
Martin Summers, the East European Desk Officer for the Catholic Fund for Overseas Development in Great Britain presented similar ideas in the November 10–13, 1993 Zagreb Conference on the usefulness of Catholic Social Thought for the transition from a command economy to the free market. He explicitly warned: “Post-Communist countries are, however, as vulnerable as any to the disempowering process of the de-regulated international market.” (Summers 1994, 244). He also writes: “the upsurge of New Economic approaches...does hold out the promise of a significant re-localization of economic activity” (Ibid., 245). His suggestions are micro-suggestions which do not form an overall plan for economic reform in Eastern Europe. Summers shows unease with the then-prevailing hope that international competition will do the job and he makes some modest alternative suggestions. Summers argues tentatively for what Stiglitz now argues for forcefully.
Goetz Briefs concludes his masterful essay on the history of the influence of ethics on economics as follows: “A degree of freedom exists, and there are functions of the state that are vital. But we realize now as never before the existence both of a realm of necessity ruled by economic laws and of a variable zone of freedom. Because of this freedom, ethics again has a place in economic life... [and] a place in economics proper”(Briefs 1983, 298).
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(2008). Overlapping Ideas: Catholic Social Thought and Recent Nobel Laureates in Economics. In: Ethical Dimensions of the Economy. Studies in Economics Ethics and Philosophy. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-540-77111-1_11
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DOI: https://doi.org/10.1007/978-3-540-77111-1_11
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