Economics 101 & Public Square

Economics: Part of God’s Created Order

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By faith we understand that the entire universe was formed at God’s command, that what we now see did not come from anything that can be seen.

Hebrews 11:3

The market economy we live and participate in everyday here in the United States is impersonal. It is often derided because of that characteristic. However, there are many impersonal rules in the universe that are part of God’s created order. The market economy is no different.

How Is the Market Economy “Impersonal”?

There are two different ways in which the economy is “impersonal.”

1. The economy is often impersonal in that it is anonymous.

For most of us, we will never know all the people who provide the things we consume. There are simply too many people involved for them to get to know us and for us to get to know them. To get a great perspective on all the people involved in production, check out I, Smartphone by IFWE or the essay I, Pencil by Leonard Read.

2. The economy is governed by a set of impersonal rules.

Similar to the laws of physics, there are sets of economic “laws” which operate independently of what we may think of them.

Hebrews 11:13, quoted above, says “…the entire universe was formed at God’s command…” which then includes both the physical things and the invisible rules governing their behavior. He then gave humans the capacity to discover the rules he set forth within the universe.

These include rules of economics, rules like the law of supply and demand. The law of supply and demand – just like gravity – exists as a universal truth whether we like it or not.

But “Impersonal” Is Bad, Right?

Impersonal does not necessarily equal bad, inefficient or immoral. Things oftentimes work out for the better in impersonal systems. Another very impersonal social system that many of us also participate in is traffic. The impersonal rules governing traffic help us more quickly get from point A to point B.

In a recent discussion group, the assigned reading was a collection of essays by economist and theologian Paul Heyne, entitled, Are Economists Basically Immoral?” and Other Essays on Economics, Ethics, and Religion.

Within one of the essays, Heyne discusses the impersonal nature of traffic. He offers the example of a typical intersection. Each driver takes his or her turn in proper order based on when they can proceed through the intersection. There isn’t any conference between all the drivers to determine who is the busiest or deserves to go through first. Everyone takes their turn based on a prearranged set of clear and obeyed rules.

What if a driver attempts to make the system at an intersection more “personal” or “moral”? Heyne explains:

What will a driver accomplish if he refrains from advancing when the light turns green, perhaps because he’s running early and suspects that some in the cross-traffic are running late? He will almost certainly not persuade the cross-traffic to go on red; he will delay people behind him, who could well be on much more urgent missions than his own; and he will increase the likelihood of an accident by introducing substantial new uncertainties into the calculations of drivers who are observing and trying to anticipate his erratic behavior.

With the endless stream of variables that threaten safe driving, clear, impersonal rules help drivers predict outcomes and safely travel to their destinations.

Rules of the Road, Rules of the Economy

Although there is order to this system, the individuals within the system are not ordered. Just as I cannot drive through a red light, I cannot steal your personal belongings. Taking advantage of the clear, impersonal rules of the road, individuals have freedom to travel about as they like within those rules. It’s the same with our market economy.

Basic, simple rules of the road and of the economy, although impersonal, can help us make decisions and interact in a thoughtful way with the many people around us.

How do you feel about the impersonal aspects of the economy? Leave your comments here

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