September 2021 Feature
Economics is all about self-interest, markets, and relentless growth. Christianity is about love, sacrifice, and community. The two have nothing in common—or so the story goes.
This article will attempt to very briefly address several misconceptions about economics, and to suggest some areas where engagement between economics and Christian theology might prove mutually profitable.
Common misunderstanding 1: Self-interest is simply selfishness
Homo economicus, guided purely by self-interest, is often portrayed as anti-social, narcissistic, and mercenary—far removed from true humanity. This, however, is a misunderstanding of “self-interest”.
The classic expression of self-interest in Adam Smith’s The Wealth of Nations reads: “It is not from the benevolence of the butcher, the brewer, or the baker, that we expect our dinner, but from their regard to their own interest.” This isn’t a valorisation of selfishness or egotism, simply a recognition that the production and exchange of goods is often (though certainly not always) reciprocal, mutually beneficial, and contributory to the wider good.
Turning to Scripture, Jesus describes the greatest commandment as loving God wholly and loving one’s neighbour as oneself (Mark 12:28-31). “As oneself” indicates that in Christianity, too, self-interest is not necessarily selfishness.
But what of Jesus’ calls for his disciples to deny themselves and lay down their own lives (Mark 8:34-37)? Let me be clear: dying to self and living under the Lordship of Christ is a crucial and non-negotiable component of Christian discipleship. We must always be on guard against improperly-ordered desires where legitimate self-interest degenerates into sinful self-centeredness.
Further, as students of pastoral theology are well-aware, self-care is vital in sustaining sacrificial service. The present pandemic has resulted in an increase in anxiety and emotional distress. Care professionals, everyday caregivers, and Christians seeking to serve their needy neighbours remain at risk of fatigue and burnout. Might dialogue involving economists and Christian thinkers yield further insights on the proper place of self-care in work and service? Might Christianity remind economists that self-interest too easily mutates into selfishness, and might economics remind Christians that self-interest can harnessed unto long-term good?
Common misunderstanding 2: Economics idolises the market
Nobel laureates Milton Friedman and Friedrich von Hayek asserted that society’s overall welfare is best improved through the pursuit of free enterprise with minimal governmental intervention. For, the claim goes, more harm is caused by the alternative—imperfect government regulators and planners. The failure of state-planned economic activity in former communist states bears this out to some degree, but also reveals a historical backdrop in which ideology and theory were often admixed in the struggle against communism.
After all, markets, too, are imperfect. Every beginning economics student learns about market failures such as externalities (third-party spillover effects, such as pollution), monopoly power (which benefits sellers to the detriment of buyers), and asymmetric information. Both markets and governments have their flaws. The covid pandemic has illustrated this clearly and painfully at the global level.
Modern economies are really a mix of market forces and government interventions, not least in areas of fiscal policy (taxation and government spending), monetary policy (central banks), and trade policy (tariffs, quotas, trade-bloc arrangements). Thus, while the mechanism of the market does play a substantial role in economic thinking, it is not quite true that economics lionises free markets.
Of greater theological interest, however, is the fundamental reality beneath this debate: both markets and state activity are only means toward an end, that is, the mutually beneficial creation of value, access to value, and exchange of value (derived from natural resources, manufactured goods, and intangible services and ideas). As the book Is the Market Moral? notes, “it is impossible to have a market without a network of other human beings. If that is true, the market is not just about individual performance but, even more, about relationships” (p.63).
In the highly readable Economics: A Very Short Introduction, chapters on “Trust” and “Communities” precede a discussion of “Markets”. This correctly reflects the reality that markets cannot exist without basic norms of trust and mutuality. And implicit herein is that each community has its norms about which goods are too precious to be traded in markets. The underlying nexus of common virtues which enable the operation of markets should spur exploration of the “moral ecology of markets” by both economists and Christian thinkers alike.
In addition, the relational aspect of markets is aligned with Christian doctrine. For instance, the image of God in humanity may be understood substantively, functionally, and relationally. That is, while humans alone possess a spiritual substance or a soul, our bearing God’s image also involves stewarding God’s creation, and relating to God and to fellow creatures. Since markets entail both resource-management and relationality, we should consider how they, too, may be loci in which imago Dei might be made visible. The role of markets in environmental stewardship is one particularly critical area of interest.
Common misunderstanding 3: Economics focuses on growth and ignores poverty and inequality
This is easy to debunk: simply look at the Nobel prizes awarded to Amartya Sen for welfare economics (1998), Angus Deaton for his analysis of consumption, poverty, and welfare (2015), and Abhijit Banerjee, Esther Duflo, and Michael Kremer for using randomised-controlled trials to inform global poverty alleviation efforts (2019).
As with markets, income growth is ultimately a means toward a goal: livelihoods and well-being. Stagnating or falling incomes mean reduced demand for all sorts of goods and services, which has negative effects on someone’s else business, someone else’s employment, someone else’s livelihood. The current pandemic is an agonisingly stark picture of this reality.
Many Christian critiques of economics focus—rightly—on the uneven sharing of the fruits of growth. As both Old and New Testaments remind us, this is indeed an area where more must be done to practically express love and care for one’s neighbours.
At the same time, economics also asks: how to grow more fruits which can be shared? The Oxford Declaration on Christian Faith and Economics rightly notes: “In assessing economic systems from a Christian perspective, we must consider their ability both to generate and to distribute wealth and income justly” (para. 8, italics added). For instance, love for neighbour also entails creating jobs, which is more difficult when overall economic dynamism is low.
The problem of inequality has rightly received increased attention in recent years. Attending (rather than simply reacting) to this complex problem involves thinking about what equality ought to look like. Here, economist Amartya Sen’s capability approach merits consideration for its potential synergy with concepts as imago Dei, dignity for all, and flourishing within community.
This article is merely a compressed primer. Much more can and has been said about Christianity and economics, as seen in the Ethos Institute bibliography. Particularly helpful and accessible ports-of-call include Craig Blomberg’s article “Neither Capitalism nor Socialism: A Biblical Theology of Economics“ (2012) and the Fall 2011 volume of Faith and Economics. Professional economists may also wish to consider the Fall 2017 volume of Faith and Economics. May there continue to be fruitful engagement between economics and Christian theology, unto the common good.
The views in this article are entirely his own and do not represent the official position of the Trinity Annual Conference or the Methodist Church of Singapore.
Gilbert Lok has undergraduate training in Economics (1st-class honours, NUS), and postgraduate degrees in Divinity (TTC) and New Testament (Oxford). Gilbert currently serves as Assistant Pastor at Barker Road Methodist Church.