Caritas in Veritate and the Market Economy: How Do We Reconcile Traditional Christian Ethics with Economic Analysis of Social Systems?

By Oslington, Paul | Journal of Markets & Morality, Fall 2011 | Go to article overview

Caritas in Veritate and the Market Economy: How Do We Reconcile Traditional Christian Ethics with Economic Analysis of Social Systems?


Oslington, Paul, Journal of Markets & Morality


Introduction

Benedict XVI's encyclical Caritas in Veritate has aroused considerable interest since its release in July 2009 and not just in the usual Roman Catholic circles. It made the front page of the Wall Street Journal with an article "Vaticanonomics." The Economist magazine and the Financial Times in Britain devoted space in several issues to Benedict's account of globalization. An open letter by prominent evangelicals about the importance of engaging with Caritas in Veritate was published in the journal First Things. Conferences on the encyclical have been organized at the historically Protestant institutions Princeton University and Regent College in Vancouver. (1)

Such interest in a papal encyclical on globalization reflects the importance of economics in contemporary culture. There also seems to be a hunger for new ethical resources in the wake of the global financial crisis as well as a new openness to religious perspectives such as that of the encyclical. Within Roman Catholic circles, Caritas in Veritate has attracted attention because of its theoretical depth and new theological approach to markets, following from John Paul II's Centesimus Annus. In other Christian circles, there is recognition that the papal encyclicals are the most substantial, contemporary, theological engagement with economic issues, and no area is more important than economics for Christian witness in the modern world.

This article considers responses to Caritas in Veritate, concentrating on responses to its teaching about markets and economics. I will focus on what I see as the major issue for Catholic social teaching, which is the tension between its traditional emphasis on persons and their face-to-face relationships and economists' emphasis on the properties of large-scale social systems. Considering this tension raises a deeper issue of the relationship between economic analysis and philosophical/theological frameworks in which it is embedded. Can we mix any type of economic analysis with any philosophical/theological framework? If not, how exactly does a philosophical/theological framework constrain economic analysis?

Caritas in Veritate and Economics

Benedict XVI's encyclical touches on many economic issues, though seldom with the clarity and specificity that economists expect in their discipline. For instance, at section 22 the pope asserts that "the world's wealth is growing in absolute terms, but inequalities are on the increase." It is not clear what exactly he means by inequalities. Does he mean increasing divergence between the per capita incomes of different countries or is it an assertion about the distribution of individual incomes across the world? What period are we talking about exactly? The measurement issues and the evidence for several plausible interpretations of the assertion are complex and seriously debated among economists. Even more difficult are the controversies over what might be causing increases in inequality. Is it technological change, lower trade barriers, changes in relative supplies of different types of labor, or something else? There could be a similar discussion about the pope's comments on immigration in section 25, his remarks about trade and competitiveness in section 32, and what exactly he means by "malfunctions" in markets that need correction in section 24. His suggestion in section 67 about the "urgent need of a true world political authority" has attracted a great deal of comment.

This lack of specificity about theoretical and empirical issues may be frustrating for economists reading the encyclical. Statements tend to be fairly general and programmatic, suggesting what economists and ethicists need to consider rather than attempting to settle theoretical and empirical questions. There are no references to the professional literature, though often the language and what we know of the process that led to the encyclical allow us to connect the encyclical to the professional literature of economics. …

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