Today is the 106th anniversary of Ernest Friedrich Schumacher’s birth. To honor the occasion we have included below excerpts from his classic, and still profoundly relevant, 1966 essay “Buddhist Economics.” The full text and its multiple translations may be read at the Schumacher Center’s website.
In 1973 “Buddhist Economics” was collected with other essays by E. F. Schumacher in Small Is Beautiful: Economics As If People Mattered, published by Blond and Briggs, Ltd.
Small Is Beautiful went on to be translated into 27 different languages and in 1995 was named by the London Times Literary Supplement as one of the hundred most influential books written after World War II.
“Right Livelihood” is one of the requirements of the Buddha’s Noble Eightfold Path. It is clear, therefore, that there must be such a thing as Buddhist economics.
It is also clear 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. Character, at the same time, is formed primarily by a person’s work. And work, properly conducted in conditions of human dignity and freedom, blesses those who do it and equally their products.
While the materialist is mainly interested in goods, the Buddhist is mainly interested in liberation.
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.
Simplicity and non-violence are obviously closely related. The optimal pattern of consumption, producing a high degree of human satisfaction by means of a relatively low rate of consumption, allows people to live without great pressure and strain and to fulfill the primary injunction of Buddhist teaching: “Cease to do evil; try to do good.” 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.
Modern economics does not distinguish between renewable and non-renewable materials, as its very method is to equalise and quantify everything by means of a money price…From a Buddhist point of view, of course, this will not do; the essential difference between non-renewable fuels like coal and oil on the one hand and renewable fuels like wood and water-power on the other cannot be simply overlooked. 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.
It is in the light of both immediate experience and long term prospects that the study of Buddhist economics could be recommended even to those who believe that economic growth is more important than any spiritual or religious values. For it is not a question of choosing between “modern growth” and “traditional stagnation.” It is a question of finding the right path of development, the Middle Way between materialist heedlessness and traditionalist immobility, in short, of finding “Right Livelihood.”
In addition we are proud to steward the personal books and archives of Dr. Schumacher. The database of these collections may be searched online to see the scope of material that influenced Schumacher’s shaping of a new economics.
Happy Birthday Fritz!