Originally posted by gswilm
Christian theological prof, R.C. Sproul gives 32 minute lecture on [b] Economics.
Any comment is of interest to me. But only if you have watched the entire 32:14 minutes of the talk.
Anyone who has the decency to listen to the entire 32:14 minute talk, I would like to know your reaction.
Th ...[text shortened]... w beatings are welcomed, BUT you have to have seen the whole thing. No cheating please.[/b]
I watched the whole video. I will not comment on Christian ethics as applied to economic issues.
My degrees are in economics. My professional career was as a consulting economist in a small area (pensions—not the focus of my thesis research, which had to do with internal labor markets and transaction costs).
Dr. Sproul demonstrates no real understanding of “the science of economics” (his term). I suspect that he may have read a few popular books, from this or that school of economic thought. He makes no distinction, for example, between microeconomics and macroeconomics. But his focus seems to be on applying certain microeconomic principles (as he understands them Biblically) across the board.
Anyone who has studied what I’ll call “mainstream western economics” (whether neoclassical, Keynesian or post-Keynesian Institutional economics, for example) knows that economics is at least
the study of the efficient allocation of scarce resources.* The opposite of the efficient allocation of scarce resources would be what Dr. Sproul calls “waste” (the opposite of which he calls “stewardship”, as the Biblical translation of oikonomia
It is quite possible (and demonstrable in economic analysis) that the most efficient outcomes in terms of resource allocation are compatible with vastly inequitable
distributions of income and wealth. I doubt that that statement is arguable among economists of various schools (though they may argue about what is the most efficient system, and what is an acceptable degree of inequity, and what the acceptable trade-offs are). But both a Marxian and a Neoclassical economist understand that there are trade-offs.
In his brief remarks on profit, Dr. Sproul seems to assume that profits are willy-nilly re-invested in real capital
(i.e., plant and equipment for further production—in his words, “tools” ). He makes no distinction between such real capital
and mere “financial capital”, such as stocks and bonds—basically instruments for trading money for financial gain over time. No rational capitalist would re-invest profits in real production without some indication of a future increasing market for their goods--profit, alone and per se
, is not a good predictor of future real investment.
A further lack is his failure to even mention labor costs in production—is the low-wage sweatshop worker really able to buy more shirts because of low production costs. Is there such a thing as capitalist exploitation (based on returns to marginal revenue product)? How about Marxian definitions of exploitation? Perhaps even more egregious is absence of discussion of unemployment (except as a concern for compassion?)—i.e., the difference between friction, cyclical and structural unemployment, their concequences and how to deal with them.
Really, there is no reason to go into any further detail (e.g., of Post-Keynesian Institutionalist critiques of neoclassical economics—such as those of Steve Keen or Paul Davidson—generally where I tend to reside). It would be pointless.
Again, I make no comment on Biblical ethics, in economics or elsewhere. I recall from years ago a Christian theologian named M. Douglass Meeks who wrote a sustained treatise on Biblical economics, and I thought at the time that he had spent a great deal of effort researching the economic literature. You might try there.
*Classical economics (including Smith, Ricardo and Marx) spoke more about value—and had differing definitions and understandings.