Economics for Ecclesiastics

Pontifical University Economics Course Unites «Cool Heads» with «Warm Hearts»

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On October 10 and 13 the Pontifical University of the Holy Cross launched a ground-breaking academic program, Economics for Ecclesiastics. Brian Griffiths, a member of the British House of Lords and former economic policy adviser to Margaret Thatcher, taught the university’s first two inaugural lectures to a capacity-enrollment of priests, nuns, seminarians, and lay students from developing and industrialized nations.

For most of the religious students specializing in theology, philosophy, communications, and canon law, the three-module economics course means navigating a new field of human inquiry – one filled with complex charts, graphs, mathematics and an entirely different ‘lingo’ to learn.  

Economics for Ecclesiastics also represented the pontifical university’s first foray into teaching economic principles while at the same time presupposing the moral-theological teachings of the Church.

Moral judgments on issues such as fair prices, living wages, material wealth, and poverty are inevitable and welcome during classroom discussion. However, the new course concentrates on a ‘positive’, ‘scientific’ study of economics – on the empirical, objective how and what we know about economic realities, as opposed to the ‘normative’, ‘prescriptive’ aspect about how economic behavior and systems should ideally be.

While a prescriptive approach to teaching economics is of vital interest to the students, who in their professional and religious lives must assess political-economic values when preaching, giving pastoral counsel to business persons, and being effective in their missionary work, the course’s director, Msgr. Martin Schlag, has a different vision. 

Msgr. Schlag is moral theologian who created the course with philosophy professor colleague Dr. Juan Andres Mercado as part of the university’s already successful Markets, Culture and Ethics Research Center. Together they have a ‘first-things-first’ approach.   

Schlag expressed concern that religious students have long needed a broader, more “expert approach” to analyzing economic findings prior to making value judgments about specific economic conditions, actions and systems in their own experience. “Ethics has an important role to play both in economic agency and in epistemology, since every human act is always also an ethical act,” he said. Yet “morality plays a lesser role in epistemology”, that is, in how we first come to know and comprehend various economic realities. “It excludes certain aims from the object of economics, and it is possible to bridge the gap between the epistemological and moral spheres.”

This is what Paul Samuelson and William Nordhaus, co-authors of the textbook in use, mean when they say that in order for economic justice to occur economics students must have “cool heads at the service of warm hearts.”

Indeed, this also echoes the “Francis effect”, where religious and lay professionals, inspired by the new pope, are now more than ever eager to discover how to actually help ‘the least of these’ —those who suffer gross economic injustice on a daily basis. Therefore, they are encouraged not simply to hope and pray that economies fix themselves, but actually develop practical wisdom about wealth creation and human flourishing on an anthropological level.

In his first lecture, “Determination of Market Prices”, Lord Griffiths introduced some core economic concepts, such as supply-demand curves, input-output, price equilibrium, perfect-imperfect competition, inelasticity-elasticity, market failure, externalities, variables, and scarcity. “Economies are complex and require careful study”, he said, referring to the tens of millions of exchanges that occur every day in commercial trade.   

One inquisitive student raised the issue regarding the actual effect 40 million aborted children has had on supply and demand curves for commodity and labor markets in the United States, while others debated practical examples of how price equilibriums are reached in inelastic and elastic demand curves. 

Milk is an example of a “commodity that has high inelasticity”, said Griffiths. The demand tends to be steep for essential, staple items of “our daily bread”, he said.

“People will be willing to pay high price for milk and bread –up until a certain point, of course,” he said while discussing the latest example of price fluctuation of milk from 31 to 27 pence in the United Kingdom. “There are also variables and externalities”, he said, that can drive prices down such as “health concerns”, citing a recent drop in British dairy consumption and price due to studies released correlating fatty whole-milk products to heart disease and obesity.

Session II, “Government and Markets”, focused on the definitions of basic economic models: free market capitalism, command-and-control economies, and “mixed versions” which combine elements of free exchange with some level of government intervention. “There really is no pure market or pure command economy”, said Griffiths. “Virtually every contemporary economy is a mix of both.” He said it is really a question of percentage of which has more market exchange or more government involvement in the overall macro-economic balance.

Some technical policy discussion centered on the effect which government subsidies, tariffs, import substitution, regulation, and price ceilings have had on developing and industrialized economies. Extreme examples, as during war-time Britain, included radical effects on price and supply curves due to government rationing of commodities, like butter, and large-scale import bans.       

The next two modules of Economics for Ecclesiastics –  “Inflation and Debt” and “Entrepreneurs, Growth, and Poverty” – will be co-taught by Lord Griffiths and Dr. Antonio Argandoña, emeritus professor of economics and business ethics at Spain’s leading MBA program, I.E.S.E. Between module lectures, the Markets, Culture and Ethics Research Center will offer students and professionals ongoing seminars on economic history and business ethics.  

Michael Severance is Operations Manager at the Acton Institute for the Study of Religion and Liberty in Rome.

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Michael Severance

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