Economics 101 & Public Square

Six Christian Professors Weigh in on Markets, Justice, and Exploitation

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In Monday’s post, Hugh Whelchel examined whether free markets inherently lead to exploitation. He wrote in response to a Christianity Today article by Dr. Kevin Brown exploring the relationship between capitalism and the common good.

This issue is a complex one. At IFWE, we aim to analyze this and other economic issues first and foremost through the lens of Scripture.

In an effort to shed more light on this topic, we reached out to a number of Christian professors across the country to speak to these issues.

We asked them to briefly respond to the question of whether markets, within a biblical framework, lessen exploitation. Here are their answers.

Don’t Deify the Market or Government Regulation

Kevin Brown argues that “markets flourish when they are grounded in property rights, with appropriate government regulation and social conventions.”

Property rights? Amen! Social conventions (Christ-centered, of course)? Amen! Appropriate government regulation? Ame…not so much.

Brown stresses that markets have unintended consequences. I would add that government regulations do too. We live in a world of imperfect markets and (very) imperfect governments.

Brown is correct that an economic system should not be deified. We must also be careful not to deify government interventions. This is precisely what we do when we create government regulations. We assume they will be implemented by saints, but we know we’re all sinners!

Exploitation comes from the power to control, a power most commonly wielded by governments. This power should be the last resort, not the first. Brown is right that “what may be best is not the same as what is perfect.” I would add that we must also resist the tendency to use government to make markets more perfect.

Dr. Joseph Connors is an assistant professor of economics at St. Leo University. 

Free Exchange Benefits Both Parties without Exploitation

I am grateful for Kevin Brown’s provocative article “Capitalism and the Common Good” and especially his heart for championing ethical labor conditions, wages, and worker’s rights. I can say along with him, “I am an advocate for the free market system” and especially that people of faith “need not deify or demonize the market.”

What we need to remember, however, is that markets operate best on self-interest, not necessarily on greed. Self-interest drives free exchanges that benefit both parties without exploitation. Greed, from a Christian perspective, goes beyond self-interest into profiting from the harm of other people.

Brown’s example of the young woman from New Zealand who sold her virginity online does not represent a “legitimate market” as he states, since the Bible clearly forbids such fornication. Such a sales transaction can only be motivated by greed. In the same way, violence associated with the mining of coltan (or tantalum) is driven by greed and is not part of legitimate free markets. The resulting human degradation is not a necessary externality of the production process of smart phones or college educations.  This is a result of sin.

The only solution to the sin of greed is the gospel of Jesus Christ. The gospel alone can save and transform people. Free markets merely channel self-interest into conditions for human flourishing but work especially well when culture is transformed by the gospel. Kevin Brown’s article ultimately seems to be arguing for the advance of the kingdom of God to restrain sin so that people can use markets to get back to work. And on that point I am confident we can agree.

David Kotter, MBA, M.Div, is an assistant professor of New Testament studies at Colorado Christian University. 

Service Drives Success, Not Exploitation, in a Market System

Minimizing coercion allows people to flourish. When it comes to maximizing flourishing, no system compares to the market system. The market system is built on peaceful cooperation. Sinful people engage in sinful actions within the market system.

But to succeed in a market system one must serve other people, not exploit them. The market system takes the most self-centered person and, if he desires wealth, incentivizes him to serve his fellow man. He cannot force them to do business with him; he can only persuade. This voluntary cooperation allows each person to flourish.

Dr. Brian Baugus is an assistant professor of economics at Regent University in Virginia Beach, VA. 

Sin Permeates People, Not Markets

A necessary condition for exploitation is the varying degrees of power exploiters hold over the exploited. Competition within markets erodes power of the few while governments, through regulation, tend to allow existing firms further protection and power. The illegal acts regarding the acquisition of Coltan cannot be blamed on the market system.

Sin permeates people, not markets. It is people that will exploit others regardless of the system that is in place. A lack of property rights and therefore a lack of markets is the cause for the Coltan controversy.

Had there been a government ran by a rule of law that enforced property rights, the market system would have provided economic justice to the parties involved. Christians moved by the Ten Commandments on issues like stealing should spend time lobbying for property rights rather than lobbying for erecting barriers to competition through regulation. Let the positive externalities of our personal relationship with Jesus permeate markets and overcome sin.

Dr. Russ McCullough is the Wayne Angell Chair of Economics at Ottawa University in Kansas.

Promote, Don’t Block Work Alternatives for the Vulnerable

The market is a network of voluntary exchange. Nothing more, nothing less. It is not the arbiter of truth and beauty, but it is a marvelous institution nonetheless, because the market price system allows for the coordination of a vast, complex market division of labor that increases the productivity, income, wealth, and standard of living of everyone who participates.

This even includes those employed in harsh working environments at what most Americans would think of as unacceptably low pay. We should note, however, that what most people see as labor exploitation is, in fact, people choosing work under such conditions because it is their best alternative.

Of course Christ calls us to be responsible market participants. However, responsibility includes not harming others in the name of good intentions. We do not help the most vulnerable of our society by taking away their best alternatives.

Dr. Shawn Ritenour is Professor of Economics at Grove City College.

Beware of Cronyism

Critics suggest that free market capitalism is an exploitative economic system, implying that it promulgates poverty and inequality. Research suggests that economic liberalization promotes growth, alleviates poverty, and reduces inequality by empowering individuals to harness their God-given talents for self and societal improvement.

While critics complain about low wages and poor working conditions in liberalizing economies, the comparison being made is relative to prosperous market economies, not the conditions prior to liberalization. People are better off; otherwise they would remain engaged in their previous employments.

Interventionism can potentially further improve the conditions of the least among us, but we cannot be fooled by a romantic view of politics. Politicians and bureaucrats are rational agents pursuing their own interests, which are not always benevolent but sometimes bow to incentives offered by favor-seeking cronies. Capitalism hindered by cronyism leads to exploitation, undermining the empowering force of free markets to solve social problems.

Dr. Daniel Bennett is an assistant professor of economics in the Department of Government at Patrick Henry College. 

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