Knowing How and Knowing Why to Obtain Economic Prosperity

0:00It's a pleasure to be here and share some thoughts about the Church and economics. You'll ask to all of us just five to seven minutes of presentation. And I'm trying to observe this rule that you gave to us. Knowing How and Knowing Why is the title that I gave to my presentation. Knowing How refers to the economic knowledge or the perspective from economic science and Knowing Why refers to the perspective of the Catholic social teaching when we are dealing with the human dilemma or the human situation in the market process and in social process.

0:51When scholars are facing the problem of economic prosperity, it is unavoidable to deal with the problem of human dignity and the world well-being of people in society. Often, the economists are required to answer to questions that refer to some issues beyond the pure field of market theory. This is why, here, we can propose two types of scholars. One that is methodologically oriented. Another one that is theological or morally oriented when they are trying to answer this social or economic question.

1:40The economist, always closer to methodological issues, usually gives good answers to topics like epistemological foundations of economics, logical reasoning that underlines basic assumptions of the theory, conditions and prerequisites for certain market phenomena and so forth. It is logical to conclude that these kinds of scholars, the economists, strict economists, tend to think using conceptual categories and to leave aside questions regarding human condition, more precisely questions about morality and ethics.

2:28However, the second type of scholars that I propose, more orient to moral inquiries, ask a different type of questions, not only regarding economic dynamics and processes, but also regarding moral condition of humans within the market process. Also, economics and social doctrine texts cover important topics regarding market process from different and distinct angles. It is important to note that they do not have essential contradictions when dealing with economic activities. And here, I am following the thought of Samuel Dr. Greg, he's a moral philosopher here in America, and he says the obligation of Christians to live in fruit do not somehow cease when their thought and action embrace economic realm. The question thus arises, how compatible is economics as an intellectual discipline with Orthodox Christian Teaching about the Good Life.

3:48Many Christians will already recognize that there are some distinct difference, even incompatibilities between the two. Yet, close attention to some of the assumptions of economics indicates that Christian morality has more in common with the economic way of thinking that one might initially expect. Greg finished. As we will see during this presentation, when topics like labor, entrepreneurship, human well-being and dignity, freedom, and even the essential features of capitalism, we can find good arguments in favor of those topics from both perspectives, from the Church and from the economics.

4:42But of course, we have to remember that each field has its own scope and purpose. Thus, we must be cautious, we must be prudent when we are declaring that economics and Catholic social teaching are very similar or closely interconnected. But for instance, economics can be greatly benefit from the perspective of morality or from the perspective of Catholic social teaching. As we can see in this comment about the exaggeration of economic assumptions.

5:29Buchanan says that. There are, however, some economists who take Adam Smith's observation that people pursue their own self-interest in the material realm and elevate it to the status of an article of faith, thereby holding that everything is essentially driven by economic and Economic Self-interest. We can see this kind of intellectual abuse of the term in economics, but the same can be applied to the realm of morality. The philosopher Gregg says about in this light, it is quite understandable for some economists to become frustrated by by some Christians reluctance to acknowledge the insights of economics or to consider the implication of such insights for the formulation of economic policy. Indeed, they correctly argue that it is irresponsible for people studying public policy from a Christian perspective to ignore not only the self-evident fact of scarcity, but also the likely economic consequence of different choices.

6:59The quote ends.

7:06So we can see that we can expect very important conclusions

7:14from exploring these kind of connections between two different fields as ethics and economics are.

7:27And following my argument, I'm going to give you just five coincidences that I see as reasonable for more exploration and research for us. for us. The first coincidence that I propose is that both systems, the church and economics,

7:53claim for a purposeful and free action. Most of the writings of Catholic social doctrine

8:05have distinctive analysis of the dangers of extreme forms of social system. We can find Several warnings against the moral consequences of socialist agenda, especially because self-responsibility principle is under attack and, of course, this has serious consequences for ethical behavior. Also, we can find that at the end, the argument against these extreme forms of social behavior is oriented toward a defense of purposeful behavior for humans, and this purpose is generally, in terms of the Church, connected to God's plan and moral standards.

8:57Man is free and oriented toward purposeful life. The concept of free person here is of first importance. Now, in the side of economics, the amazing fact is that purposeful behavior is a fundamental idea, especially from Misesian perspective. Action is organized under the fundamental categories of means and ends, and following the Misesian thought, one of the basic features of human acting is precisely the teleology of action.

9:45In other words, every human act requires a purpose for being precisely such act. This is the first coincidence that I propose. The second is the creative nature of human action. And this connects directly to the problem of entrepreneurship in the realm of economics. Entrepreneurial action is another feature to be considered when we are analyzing some common conclusions from economics and morality. For the economist, entrepreneur is the endogenous modern of the market.

10:35And through his action, the business that he runs increment its economic value. For Catholic doctrine, entrepreneurial action represents the creative potential that every person shows in the terrain life. Again, the creation and innovation are good examples of regarding entrepreneurship is very interesting this statement made by Pius XII in the 50s, I quote, I quote, among the motifs that justifies the holding of this convention, you have given the first place to a vindication of the indispensable functions of the private entrepreneur.

11:44The convention, of course, is addressed to entrepreneurs in Rome. and following. The latter exhibits in an eminent degree the spirit of the free enterprise to which we owe the remarkable progress that has been made especially during the past 50 years, and notably in the field of industry. So it's very important to note this idea and this opinion of a Pope Regarding the Entrepreneurship.

12:23The third idea that I want to give here is the importance that both system gives to the time of labor. In the case of the church, labor is very important because it means to develop the person So it's an anthropological topic for the Church and in economics we can understand the importance of work regarding the market factor of production and the importance that the productivity of The third argument that I want to say is the importance that the acting person and the acting human has for both systems.

13:30It's very important to note that one of the Popes that helped the most for remarking the importance of the acting person as center of the anthropological discourse of the Church was John Paul II. Action is precisely the element that reveals what man is. It's evident that what Wheeler gave a special emphasis on that fundamental character of acting human in his encyclicals and official writings when he became the Pope John Paul II. The importance of action in the development of nature of man has a crucial role in Catholic ethics today. Furthermore, acting is fundamental for anthropological view from the Catholic perspective.

14:34In economics, the central role of acting human is indispensable for understanding the dynamics of market process. Again, we can find this important coincidence between Catholic doctrine and economics. Action is the fundamental category that allows us to develop models and theories for a variety of economic processes. Regarding to this point, the monumental work of Ludwig von Mises remains as the reference book for excellence for academic circles. Okay, I think that I'm going to stop here to leave time for questions.