In his now classic essay “Buddhist Economics,” Fritz Schumacher imagines an economic system informed by the teachings of the Buddha. Key to such a system is simplicity and non-violence.
. . . the Buddhist economist would insist that a population basing its economic life on non-renewable fuels is living parasitically, on capital instead of income. Such a way of life could have no permanence and could therefore be justified only as a purely temporary expedient. As the world’s resource of non-renewable fuels–coal, oil, and natural gas–are exceedingly unevenly distributed over the globe and undoubtedly limited in quantity, it is clear that their exploitation at an ever-increasing rate is an act of violence against nature which must almost inevitably lead to violence between men.
From a Buddhist perspective, Schumacher argues, the most rational form of production is from local resources for local needs. Work is not something to avoid but “blesses those who do it” when conducted in conditions of human dignity and freedom, so favoring a system of full employment.
The most important aspect of Schumacher’s essay is the simple reminder that our economic systems should reflect our highest aspirations as a culture—whether we find the source of those aspirations in religion, philosophy, our communion with nature, or our sympathy with others. Schumacher, the economist, demonstrates how to transform the material laws of economics through actions infused by principles.
Schumacher did not limit his exploration of a value-based economics to Buddhist thinking. His daughter and biographer, Barbara Wood, tells us that before his death her father was preparing an essay on “Islamic Economics.”
Values, we find, are not only the product of religion. Jane Jacobs in her 1983 Schumacher Lecture “The Economy of Regions” and her book Cities and the Wealth of Nations, presents a similarly visionary way of thinking of economics. As a regional planner, she sees the profound way that place informs the human spirit and her work advocates for vibrant regional economies.
At a time when the effects of the global economy are proving ever more crushing on local communities and the people and ecology of those communities, Schumacher’s 1966 essay continues to challenge us to imagine another kind of economic future. That imagining is the first step to implementation.
“Buddhist Economics” was collected in Small Is Beautiful: Economics as if People Mattered, published in 1973 and translated into over twenty-seven languages. The book inspired a generation. Through the kindness of Verena Schumacher and the generosity of the translators and publishers of her husband’s works, Schumacher Center staff are gathering together as many versions of “Buddhist Economics” as possible to share with a new generation through the Internet. German, Greek, Japanese, Korean, Norwegian, and Russian texts may already be viewed at the Schumacher Center’s website. Danish, Dutch, French, Hungarian, Italian, Polish, Spanish, and Swedish are soon to come. Please share them widely, with credit to their sources, as a message of peace and possibility in these troubled times. We encourage new translations for inclusion.
Schumacher’s original English text of “Buddhist Economics,” Jane Jacobs’ “Economy of Regions,” and other Schumacher Center lectures may be read online at any time or purchased in pamphlet form for gifts.
Quotes from “Buddhist Economics” by Ernst Friedrich Schumacher
It is clear, therefore, that Buddhist economics must be very different from the economics of modern materialism, since the Buddhist sees the essence of civilisation not in a multiplication of wants but in the purification of human character.
While the materialist is mainly interested in goods, the Buddhist is mainly interested in liberation. But Buddhism is “The Middle Way” and therefore in no way antagonistic to physical well-being. It is not wealth that stands in the way of liberation but the attachment to wealth; not the enjoyment of pleasurable things but the craving for them. The keynote of Buddhist economics, therefore, is simplicity and non-violence. From an economist’s point of view, the marvel of the Buddhist way of life is the utter rationality of its pattern–amazingly small means leading to extraordinarily satisfactory results.
The ownership and the consumption of goods is a means to an end, and Buddhist economics is the systematic study of how to attain given ends with the minimum means.
As physical resources are everywhere limited, people satisfying their needs by means of a modest use of resources are obviously less likely to be at each other’s throats than people depending upon a high rate of use. Equally, people who live in highly self-sufficient local communities are less likely to get involved in large-scale violence than people whose existence depends on world-wide systems of trade.
From the point of view of Buddhist economics, therefore, production from local resources for local needs is the most rational way of economic life, while dependence on imports from afar and the consequent need to produce for export to unknown and distant peoples is highly uneconomic and justifiable only in exceptional cases and on a small scale.
From a Buddhist point of view . . . non-renewable goods must be used only if they are indispensable, and then only with the greatest care and the most meticulous concern for conservation. To use them heedlessly or extravagantly is an act of violence, and while complete non-violence may not be attainable on this earth, there is nonetheless an ineluctable duty on man to aim at the ideal of non-violence in all he does.
. . . the Buddhist economist would insist that a population basing its economic life on non-renewable fuels is living parasitically, on capital instead of income. Such a way of life could have no permanence and could therefore be justified only as a purely temporary expedient. As the world’s resource of non-renewable fuels–coal, oil, and natural gas–are exceedingly unevenly distributed over the globe and undoubtedly limited in quantity, it is clear that their exploitation at an ever-increasing rate is an act of violence against nature which must almost inevitably lead to violence between men.