Buddhist Economics. What is it and why now?

Zoltán Valcsicsák who is volunteering in Bhutan made an interview with me on Budhist economics.

Buddhist Economics. What is it and why now?

When did you get introduced to Buddhist Economics?

I studied economics in the late 1970s. I was not ready to accept the basic dogma of modern Western economics that self-interest behaviour serves the common good. I always felt that something is wrong with the “greed is good” position. Reading E.F. Schumacher’s essay on Buddhist economics was liberating for me. It demonstrated that an alternative economic worldview is possible where the main function of economic activities is not to maximize material growth but to create sustainable livelihood for people and communities.

 What does Buddhist economics mean?

Buddhist economics can be seen as a radical alternative to the Western economic mindset. Western economics represents a maximizing framework. It wants to maximize profit, desires, market, instrumental use, and self-interest and tends to build a world where “bigger is better” and “more is more”. Buddhist economics represents a minimizing framework where suffering, desires, violence, instrumental use, and self-interest have to be minimized. This is why “small is beautiful” and “less is more” nicely express the essence of the Buddhist approach to economic questions.

 Is it a Western concept or was it originated in Buddhist countries?

I think Buddhist economics is an universal concept. It might be relevant for Buddhist and non-Buddhist countries as well. By reducing desires it can serve as a vechicle for reducing the society’s material metabolism and consequnetly its ecological footprint. I agree with the Thai Buddhist monk and philosopher, P.A. Payutto that one should not be a Buddhist or an economist to be interested in Buddhist economics. Buddhist ethical principles and their applications in economic life offer a way of being and acting, which can help people to live a more ecological and happier life while contributing to the reduction of human and non-human suffering in the world.

 Is there any country in the world that, at least partly, follows the concept of BE?

Bhutan can be mentioned as an example where Buddhist economics is influencing economic policy. Another example is the Sarvodaya movement in Shri Lanka where thousands of people and hundreds of villages cooperate to develop a “Right livelihood”. In Thailand the Santi Asoke movement are experimenting with self-reliant economic models. Japan’s extremely successfull eco-efficiency technologies are influenced by the Buddhist ethics of “not wasting”.

What has to change in Europe to follow BE principles?

The self-centered way of life, the “greed culture” of Europe and North-America should be changed. The economic crisis of 2008-2010 produced financial losses of billions of USD in the form of poisoned debts, the decline of stock prices and the value depreciation of properties. The prospect of future economic growth supposed to be the guarantor of the indebtedness of households, companies and economies. Today we experience a considerable downscaling of our economies.

The global warming survival guide created by the American weekly magazine, Time  suggest the following: “There is an older path to reducing our impact on the planet that will feel familiar to Evangelical Christians and Buddhists alike. Live simply. Meditate. Consume less. Think more. Get to know your neighbors. Borrow when you need to and lend when asked. E.F. Schumacher praised that philosophy this way in Small Is Beautiful: Amazingly small means leading to extraordinarily satisfying results.”

What is the link between BE and Gross National Happiness?

The Gross National Happiness (GNH) is a policy framework to realize the main principles of Buddhist economics. GNH can be regarded as the next stage in the evolution of indicators for sustainable development, going beyond merely measuring values that can be expressed in money.

Bhutan’s leaders define GNH in terms of four pillars: economic development, good governance, cultural preservation and nature conservation. The benefit of this model is that it includes both GDP – the ‘lowest’ level bottom line – while complementing it with ‘higher level’ components. Political decisions are made on the basis of trade-offs. For example, when faced with the choice between providing employment versus the preservation of environment, most governments would choose the former. The GNH model shows that this trade-offs should be made in the context of a hierarchy of values. Otherwise policymakers will sacrifice higher level values for lower level ones.

How do you feel about the UK and French government considering measuring well-being and happiness of their citizens?

Trying to measure well-being and happiness – instead of simply measuring economic growth – is a good step forward. The Stiglitz & Sen & Fitoussi Report presents an advanced view on sustainability and social well-being. We should not be interested in the well-being or happiness of people only but also in the sustainability of their living. Well-being at the expense of nature and future generations cannot be accepted. At present most of the Western countries exceed their right “earth share” by 250-600 %.

Is it something you would suggest to the Hungarian government?

Perhaps the most urgent task for the Hungarian government (and also for other Western goverments) is to reduce the extremely high level of indebtedness of the country. The high level of debts presents enourmous pressure on people and communities and would force government to follow irresponsible economic growth paths. Another important task is not to engage in nature-destroying technologies such as GMO (genetically modified organism) production and nuclear energy generation.

What are the available resources about BE?

We developed the Buddhist Economics Research Platform which collects the most important contributions in Buddhist economics. I am editing a new book on Buddhist economics for Springer which will be published in 2011.