We look at Buddhism as an approach to economics, following two recent books: The Buddha on Wall Street by Vaddhaka Linn, and Buddhist Economics by Prof. Clair Brown.
We will consider whether what they propose is really Buddhist, and whether it’s really economics. And we’ll consider whether in the end it matters.
Thanks for this episode, Doug.
In the “is it economics?” segment, the term “political economy” came to mind:
So a Buddhist political economy is an interesting idea, but like you say here, I think we have to extend the Buddha-Dharma (as best we can derive it from the Pali Canon) into the political-economic domain, in which the early texts (as far as I’ve seen) show very little interest.
I suppose dominantly Buddhist countries can serve to some extent as real-world exhibits, but then I suspect we’ll find ourselves mired in debates as to how much or how little their governments actually instantiate models of Buddhist political economy.
I think we could extrapolate from the Buddha’s teachings that using GDP as the sole means of assessing economics would not be the most “Buddhist” way of doing things. What I mean by that is GDP alone is a measure only of how much money a country makes. While the Buddha didn’t say it was a problem for lay people to make money, he did say that measuring one’s success solely on the accumulation of wealth could be a problem – that is, attachment to money as an important part of your identity won’t lead to true happiness. In the Sakka Sutta it is recorded that the Buddha asked, “would that man [referring to a man who had built great wealth], because of that wealth, on account of that wealth, with that wealth as the cause, live sensitive to unalloyed bliss for a day, a night, half a day, or half a night?” The lay Sakyan followers then responded, “No, lord. Sensual pleasures are inconstant, hollow, false, deceptive by nature.”
The Buddha also had some input as to microeconomics in the discussions of beneficial livelihood that could be expanded to a stance on macroeconomics. In the Dighajanu (Vyagghapajja) Sutta, the Buddha is recorded to have said, “What is balanced livelihood? Herein, Vyagghapajja, a householder knowing his income and expenses leads a balanced life, neither extravagant nor miserly, knowing that thus his income will stand in excess of his expenses, but not his expenses in excess of his income.” And in the Adiya Sutta the Buddha was recorded as saying there were five benefits that can be obtained from wealth which can be checked out at http://www.accesstoinsight.org/tipitaka/an/an05/an05.041.than.html. My summary of the five benefits would go something like this, “he rightly [that is neither extravagantly nor miserly] maintains himself, his family, and his house; he rightly maintains what he can provide to his friends and associates; he wards off calamity from fire and floods and keeps himself safe (basically, insurance); he provides offerings to relatives, guests, the dead, and the government; he provides offerings of supreme aim resulting in happiness around him.”
I think the thrust of those suttas aligns pretty well with the four “concerns” mentioned in the video. From these suttas, I’d say that a “Buddhist Economics” would askew GDP in favor of other metrics of success. For example, the first concern of happiness could be measured by the Human Development Index (HDI). To include the second concern of inequality, there is an adjusted form of the HDI called the Inequality-Adjusted Human Development Index (IHDI) (http://hdr.undp.org/en/composite/IHDI). The third concern of waste could arguably be represented as debt to GDP ratio (https://www.cia.gov/library/publications/the-world-factbook/rankorder/2186rank.html). The fourth concern of effects on the environment is a bit stickier since I don’t know of reliable measure currently used for determining this, although there are some (likely biased) attempts out there from groups like EcoWatch (https://www.ecowatch.com/top-10-greenest-countries-in-the-world-1881962985.html).
When I look over those four metrics, the countries that seem to be most aligned with a “Buddhist” approach to economics are the Scandinavian countries (especially Norway, Denmark, and Sweden). I think it’s unlikely these countries intentionally designed their policies to align with Buddhism. Rather, these countries rank among the least religious in the world and their policies likely grew from a place of humanism. Of course, I think many Secular Buddhists would agree that Secular Buddhism is a form of liberal humanism.
Thanks for the comments, Jason and m.miller. Yes, it could be an example of political economy, but I’m really out of my depth in that field so will have to leave it to others to comment further!
M.miller gives some further examples of relevant passages in the canon. While they are intended specifically to recommend right action with regard to wealth at an individual level, I think they can be extrapolated further. At any rate if you are interested in alternative measures to GDP, Clare Brown goes through quite a few in detail.
Afterthought: I started a related thread on this site (wow, nearly five years ago already!), based on a Bhikkhu Bodhi lecture re: Occupy Wall Street. Here it is, for anyone who’s interested.
In retrospect, I was more impressed by the venerable monk’s grasp of contemporary research on the social effects of economic inequality than I was by his traditional sources. Compared to the ancient precursor of modern political economy that we find in, say, the works of Plato and Aristotle, the relevant Pali sources strike me as a nearly empty basket of cherries, picked from a few trees scattered in an enormous orchard that’s dominated by apples. (Okay, so much for my simile-making.)
I don’t intend that as a slight against Buddhism – after all, Aristotle’s and Plato’s politics have not aged so well, and Gotama’s likely would not have either, had he explored and taught the model of an ideal Buddhist state in much greater detail. Maybe it’s better to just have some basic principles to work from and to apply to current conditions, as Bhikkhu Bodhi demonstrated.
Well, insofar as we can tell from the ancient sources, the Buddha was not so much interested in reforming the contemporary sociopolitical culture as he was creating a new culture of sangha that would enable people to most easily attain personal awakening.
This is however consistent with an ideal that would say a culture dominated by awakened beings would mirror in important respects the relative egalitarianism, pacifism, etc. of the sangha.
For a better and more concrete picture of Buddhist sociopolitics, from a roughly contemporaneous source, it is also good to reflect upon the ideals put forward by king Aśoka, at least as reflected in his rock edicts.
(Not taking anything away from Bhikkhu Bodhi of course).
There is quite a bit of interest in developing a Gross National Welfare index to capture what the GNP misses. It seems this was anticipated by Bhutan, which calculates Gross National happiness, and is apparently the only country in the world with Buddhism as its state religion. I read in Wiki that: “The GNW Index is not to be confused with Bhutan’s GNH Index, while both frameworks were inspired by the Gross National Happiness philosophy that was introduced by the former King of Bhutan in 1972. Both frameworks are similar in origin and purpose but different in authorship, creation dates, and geographic scope.”
Here in Canada, one of leading advocates of GNW is a former Premier of my Province. I’ve never spoken to him directly about it, but I think I know him well enough to say I’d be very surprised if he has any idea that there is a Buddhist connection to GNW. This has some relevance to our current topic, I‘m sure, but I’m not sure just what it is.
I’ve been thinking about Buddhist economics, and mulled over comments I might make – but in the end, I think the most useful thing I can say is that the most important contribution Buddhism can make to economic policy is to warn against (as some one else put it here) attachment to wealth – I’d add attachment to status as well. If we let these attachment define us, and define the kind of community we live in, welfare and happiness are bound to suffer.
Doug wrote : “Well, insofar as we can tell from the ancient sources, the Buddha was not so much interested in reforming the contemporary sociopolitical culture . . . “. Yes, but would it not also be true to say that Gotama was interested in developing a basis for ethical behaviour in the new post-tribal sociopolitical culture that was emerging in his time? This would have implications for the shape the new culture was taking.
It’s been suggested that a close reading of the texts shows that Gotama had a particularly strong appeal among the Vaishyas, merchants and tradesmen, key actors in the emerging urban, commercial economy of the time. Perhaps not surprising then that Gotama didn’t rail against taking a profit. But perhaps he did want to give them some ethical foundation for their activities that traditional Brahman ethics did not supply.
Thanks for your comments, Michael! Yes and yes. Attachment to wealth and status are routes to suffering. And indeed, the Buddha was interested in advancing and maturing ethical behavior in his sociopolitical environment, proposing an alternative to brahminic ethics, such as it was.
Buddhism is not concerned with “inequality” because it is concerned with individual kamma & individual initiative. Buddhism concerned itself with paying workers a fair days pay for a fair days work (refer to DN 31).
The suttas provide the following principles, which could be considered “economic”: (i) similar to Indra’s Net, DN 31 teaches about the “six directions”, where one direction is the relationship between employers & employees, where employees are sufficiently remunerated, including sick leave, annual leave & profit sharing, for doing a good & proper days work. This brings to mind the early labour relations of Henry Ford, who realised by paying his workers $5/day instead of $2.50/day, the workers could afford to buy a model-T Ford for $850 & this increase Ford’s sales. Therefore, good pay for good work means good business sales, as seen in German economy, where Germans work harder than other nations, get paid more, yet are more efficient. (2) Buddha taught about the four requisites of life therefore, as stated in DN 31, good pay should be sufficient for the four requisites. Unlike other developed nations, the USA cannot afford universal health care because its health care is mostly privately provided for profit. The four requisites model emphasises affordable thus not-for-profit govt provided healthcare & also emphasises keeping housing affordable. (3) The Buddha censured indebtedness (AN 4.62) therefore creating a debt funded consumer economy, such as currently in the USA, is against Buddhist principles. (4) The Buddha condemned earning of wealth for the sake of wealth. While the Buddha praised skill in earning wealth, he condemned not using it for social benefaction. (5) The Buddha said wealth is to be earned blamelessly or ethically, including mentioning wrong forms of livelihood. In summary, disregard for worker pay, use of slavery & wrong livelihoods are inherent in Laizee Faire capitalism.
Seems to me, the dhamma implies that if we strip away illusions, strip away attachments to wealth & status — socially-generated and self-imposed expectations that we mistakenly believe will guarantee happiness — when we recognize that all of us must confront suffering and mortality, then our essential equalty is revealed.