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What differences should we see in work done by Christian economists vs. those who do not profess the Christian faith?
Being a Good Physician
"If I were to take your course in econometrics, would I be able to tell that you are a Christian?" This question was put to me by a new graduate from my own alma mater, Gordon College — a college known for its emphasis on integrating faith and learning. Assuming the student was referring to the contents of the course, I replied, "probably not." But could someone discern that C. Everett Koop was a Christian by watching him do surgery? I suspect the answer would also be no. Does that mean that both he and I are practicing our secular "profession" while keeping it insulated from our Christian "profession"?
Recently, a colleague asked me whether or not my views on many issues in international trade and economic development would be similar to those of Jagdish Bhagwati. I have great respect for Bhagwati's work, and find myself in agreement with a large part of his published analyses on many issues in my fields. To my knowledge Bhagwati does not profess to be a Christian. Does this mean that my approach to issues in my field, and therefore my own research work, are in some sense completely secular?
Questions like these lead me to ask exactly how my Christian faith should make a difference in my work in economics? What differences should we see in work done by Christian economists vs. those who do not profess the Christian faith? What impact should this have on the economics profession at large? In a very interesting survey article, "Economics and the Evangelical Mind,"1 John Anderson (1996) quotes Mark Noll as being encouraged by the development of scholarly societies such as the Association of Christian Economists. He sees this development as a "hopeful sign of new intellectual vigor among evangelicals." Yet in Noll's opinion, "With the exception of the Society of Christian Philosophers, these associations have not exerted a compelling influence on their larger disciplines." But how does one measure a compelling influence? What are we expecting to see?
In what follows I would like to make the case that there are generally three broad roles for the Christian economist: the philosopher, the physician, and the advocate. The way in which our faith is visible in our work depends upon which role we are adopting. Although we must in some sense adopt all three roles, I believe (as a true trade economist) that we should specialize in our area of comparative advantage. For me that is the role of the physician.
II. The Philosopher, the Physician, and the Advocate
A. A Plethora of Philosophers
Being the daughter of a philosopher, and someone who loves the subject, I am at once drawn to thinking about the presuppositions underlying modern economic thought. Those who did their graduate work in the late 1970s or afterwards know that almost no graduate program offers courses in the history of economic thought. Nor do the faculty expect students to read the works of Smith, Keynes, von Mises, Marx, or others. Clearly Christian economists have a distinct role to play here: to investigate the extent to which the philosophical presuppositions underlying these and other influential works are consistent with a Christian world view. In fact, as Anderson's survey noted, much of the focus of Christian economists in the past twenty years has been on exactly this. One debate has focussed on whether or not the "neoclassical" paradigm of human economic behavior is consistent with a Christian view of human beings and society as a whole. This has led to proposals for entirely new methodologies. Another debate has centered on whether a centralized or a market oriented economic system is more Biblical in its structure or outcomes.
As a philosopher, however, the Christian economist is somewhat handicapped. Most of us have little or no training in philosophy. Thus, instead of being first-rate economics, our research can easily end up being third-rate philosophy (or worse)! The dangers resulting from our lack of training are nicely illustrated in two articles by four economists in the fields of trade and development. In 1984, Avinash Dixit and Gene Grossman published a short paper in the American Economic Review entitled: "Directly Unproductive Prophet-Seeking Activities."2 Bhagwati and T.N. Srinivasan (who have contributed much to the study of directly unproductive profit-seeking) responded in 1986 in Public Choice with "Religion as Activity."3 Both of these papers are economic analyses of organized religion. The authors are eminent scholars in economics, but none are professing Christians.
In the first paper, Dixit and Grossman assume that an unknown force has appointed religious institutions as an intermediary to hand out tickets to heaven. This is their sole purpose. The religious sector, therefore, has the incentive to extract rents from people who are willing to pay for the chance to be in heaven. It is easy to show that such rent-seeking activity diverts resources from productive activities in the economy. Hence, "organized religion" lowers society's welfare. In the second paper, unorganized religion does not introduce any distortions, since it satisfies man's desire to commune with God. However, because organized religion acts as an intermediary between man and God, there is once again an incentive for the religious sector to engage in rent-seeking activity. But Bhagwati and Srinivasan assume that the religious sector can actually make individuals' prayers more effective. If so, this sector does engage in one kind of productive activity, for which people are willing to pay. Thus, despite the activity of the church, the welfare of society may still be improved by the existence of the church.
As Christians we will immediately balk at this characterization of the church and the conclusions drawn from it. But we can learn from the errors in these papers. The first error that is evident is reductionism. Clearly the tools of economic analysis are inadequate to assess the impact of religion on society. These papers show the scathing critique of the church which can arise if a reductionist view of religion is taken. These four authors, however, were intending to be humorous. They realize that such a reductionist approach is inappropriate. Unfortunately, Christian economists sometimes make the same reductionist error but do not see it. They fault the economic system for not addressing all moral problems in society — e.g., for not encouraging certain virtues or inhibiting certain vices. Yet it should be just as humorous to assume that any economic system is adequate to handle moral aspects of life. This neglects the crucial role of legal systems, the church, the family, and other societal organizations in shaping moral behavior. It is a reductionist view of society.
The second error in these papers is the authors' adoption of false premises. If one characterizes organized religion in an inaccurate way, one can logically derive conclusions about its impact which are erroneous. The analysis may be elegant, and without error, but the conclusions are simply wrong. In the role of philosopher, Christian economists also fall into this trap. Characterizations of an economic system (market, socialist, mixed) are sometimes done in an inaccurate or incomplete way, and analyses of the implications of such a system are carried out. Given the premises, the analyses logically may lead to conclusions which show a system consistent or inconsistent with the Christian world view. However, the premises are false.
We need Christian economists in the role of philosopher. However, it seems that too many of us have adopted this role, without recognition of our lack of expertise. To turn out good work in this area, economists should equip themselves further in philosophy and theology. Such work should then have a broad and beneficial impact on the profession.
B. A Paucity of Physicians
A physician's role is to help improve the health of the community which he or she serves. This means diagnosing illnesses and prescribing medications. However, for physicians to do this well, there must be some who devote themselves to research. These research physicians try to learn: how certain diseases behave; whether certain medications are appropriate cures or not; whether and how certain health problems can be prevented. All of this requires a sound understanding of how the human body functions in theory, and an ability to carry out empirical work to test the validity of hypotheses.
The second role for the Christian economist is rather like that of the physician. As we read the Scriptures, we find God repeatedly calling us to take responsibility for the welfare of the poor, the carrying out of justice, the stewardship of the physical world, as well as other issues which are related to economics. Because God has asked us to make these things priorities, we should see the neglect of these duties in society rather like a disease which needs to be addressed. Such neglect may be the result of inappropriate policies or simply market failure. We need to be in the business of doing good research in order to understand how to wisely carry out our responsibilities in these areas. Doubtless, this will require that we use our training in theoretical economics to work out a thorough understanding of the problem at hand, and the implications of any proposed solutions. Following this, good empirical work will be necessary to assess the effectiveness of these different policy proposals, and to work out their implications for different groups in society.
The goal in this case, is to use our economic research to improve the "health of the economy." Just as with the research physician, the impact of our faith is not seen, necessarily, in a difference in our technical methodology from our secular counterparts. It is seen first in our choice of issues to research. Because of our faith, certain issues must be made priorities and must be addressed wisely. It is seen second in our evaluation of potential solutions. Here we should find our Biblical view of our fellow human beings (e.g., our call to love others as ourselves) influencing our choice of policy proposals. Our impact will be visible, to the extent that our work moves forward our understanding of the problem and helps to either remove deleterious policy choices or put in place those which are beneficial.
A quick glance at any country's economy is sufficient to see the great need for Christians to contribute to better methods to alleviate poverty, and to be stewards of the environment, just to name two areas of concern. Although our graduate work has indeed equipped us especially to do this kind of work, there is a paucity of Christians adopting this role of physician.C. A Pride of Advocates
A third role for the Christian economist is as an advocate of reform. Especially for those working in government policy making bodies, there is a role for advocating change where policies are seen as creating results which are intolerable from the Christian standpoint, or where the economic system fails to address problems which a Christian cannot ignore. Large groups of such advocates already exist, quite often centered around specific issues. Though these groups may include economists, they are quite often made up of non-economists who care deeply about a particular problem (e.g. R. Sider, J. Wallis, and T. Campolo, who all have written about poverty issues). Some of these groups zealously advocate particular solutions to what they view as egregious injustices in the economy. Yet, lacking economic understanding, they fail to see that their proposals themselves are sometimes flawed.
Here the Christian economist's expertise may be called upon to inform these "advocate groups" about the nature of the problem and the implications of different solutions. Many Christians want to be better informed in order to become better advocates. Yet they do no know where to go to get information. Sound economic reasoning which is made accessible to a non-professional audience is sorely needed. It is odd indeed that most contemporary Christian writing on economic issues for the general public is done by theologians or sociologists.III. The Good Physician
In the 1988 Democratic primaries, Representative Dick Gephardt argued vehemently for tighter trade restrictions on textiles and clothes imports because they were putting great competitive pressure on US import-competing firms. As a trade economist, I knew that the US Multifibre Arrangement (MFA) already existed — a complex system of voluntary export restraints (VERs) in textiles and clothes, negotiated almost exclusively with developing countries. As a development economist, I knew that these industries were critical to the growth of an industrial sector in poor countries where almost all the labor force was still in agriculture. In addition, these industries employed relatively unskilled workers and were quite labor-intensive. Any US policy which restrained such trade would, therefore, mean losses to the poorest of the poor.
In 1991 I was asked by the World Bank to explore the relationship between trade policy and environmental problems. I was surprised to run across numerous cases where trade restrictions were advocated as appropriate solutions for environmental damage, or as coercive tools to change another country's environmental policies. As a trade economist, I knew that a mismatch of a domestic problem with an international trade policy solution would generally be ineffective in improving environmental quality, and would certainly be more costly than a domestic solution. These seemed to be policy errors which developing countries could ill afford to make. In addition, the idea of imposing trade restraints as punitive and coercive measures sounded more like "eco-imperialism" than a well-intentioned effort to encourage environmental stewardship abroad.
My research work over the last 11 years has been a response to these concerns. As a Christian, I see caring for the poor and for the environment as commanded by God. If my training is to be put to good use in carrying out these responsibilities (and others), I need to pursue good research in these areas the way a physician would pursue a cure to a serious disease. My plan has been to try to develop a sound theoretical understanding of the issues, to test statistically my theoretical hypotheses, and to disseminate my results to colleagues, policy makers, and Christians in general. Hopefully, with corrections and suggestions from all three audiences, we would together make a visible impact on the health of the economy, and bring honor to God's name in doing so.
A. Develop Sound Theory
Is it really the case that the only way for the US to care for its poor textile workers is to impose restrictions which would impoverish poor textile workers in developing countries? Are such discriminatory barriers really welfare improving for the US? Little was actually known about the impact of VERs up until the mid-1980s, especially with regard to their discriminatory nature. At that time, trade theorists were in fact developing new arguments for the strategic use of trade barriers to improve one nation's welfare at the expense of its trading partners. Yet as a Christian, I could not support a policy which would sacrifice a foreigner's welfare simply to improve my own. As a result, I began my work with two theoretical studies, trying to understand how the discriminatory aspect of a VER would affect both exporter and importer (Dean and Gangopadhyay, 1991, 1992)4.
Similarly, in the early 1990s, little exploration had been done regarding how trade measures would actually affect environmental damage. Yet government policy-makers were arguing that they were the logical policy choice, despite the fact that they were not "first-best." My first two studies in this area (Dean 1995a, Dean and Gangopadhyay 1997)5 tried to determine whether there were any circumstances in which an export ban (a policy chosen by Indonesia) would actually improve environmental quality. If there were, what were the implications for the welfare of the poor in those same circumstances? Certainly the existence of a tradeoff between caring for the environment and caring for the poor would require Christians to seriously review whether or not to proceed with such a policy.
B. Provide Solid Empirical Evidence
Without any empirical testing, theoretical results are limited in their value. When it came to the US MFA, many argued that it was a system of trade restraints more like Swiss cheese — so porous that it had no binding effect. One government official actually told me that the barriers did bind, but only on the richer larger exporters, hence enhancing the chances of poor countries to capture a share of the market. Since all theoretical studies assumed binding constraints, the question of whether or not they were binding and on whom seemed critical to answer. Yet when I searched for statistical evidence of these notions, I found none. What I did find was a curious trend in US restraints which appeared to show that the US was singling out the smallest and poorest of exporters for restraint. My empirical work (Dean 1990, 1995a)6 thus attempted to measure the effect of the MFA on poor exporters, and to determine if the US had indeed developed a discriminatory policy of targeting poorer smaller countries for restraint. If the damage from US policy did exist and if it was directed toward the more vulnerable in foreign societies, Christians should be concerned. Surely such a policy would at least require serious review to see if a better alternative could be found.
The view that freer trade damages the environment has been strong enough to generate environmental side agreements as part of the NAFTA. Yet existing empirical evidence on this question has shown either no results or the opposite results. In addition, theoretical work does strongly suggest that imposing trade restrictions could damage the poor without any benefit to environmental quality. For a Christian the lack of corroborating evidence, the potential for such damage, and the lack of offsetting benefit to the environment should generate serious concern about such agreements. My present empirical work is an attempt to collect more evidence on exactly how freer trade would affect environmental quality, to better understand both its potential damage and benefits.
C. Disseminate Your Results
In economics, as in any other profession, the tendency is to see publication of one's research purely as a way of establishing a reputation in the field. The challenge to us, as Christian economists in the role of physicians, is to see dissemination of our results in a different light. Rather than for self promotion, our ultimate concern should be to see change in the economy which helps meet the responsibilities God has given us, and in this way brings glory to His name. Thus we hopefully disseminate our results to: correct errors and improve the work itself; to influence policy; to help inform Christians so that they can advocate better policies.
Certainly, peer review of my work is critical, in order to discern errors and my own shortsightedness. Only then will I be able to make any wise contribution to our ability to care for the poor and the environment. The tasks are daunting, and my contributions are certainly meager in comparison. But my hope has been that perhaps in a small way, my work on these issues would help move policy choices in a direction which is beneficial. Living in Washington, I have had the unusual opportunity to enter into dialogue with a few groups from policy making agencies such as the State Dept., the Office of Technology Assessment of the Congress, and the International Trade Commission. In addition, God has brought about dialogues with representatives from NGOs such as the National Federation for Wildlife, and from international institutions such as the World Bank and the OECD. I have tried to look at these as both chances to learn from other viewpoints and chances to raise concerns which result from my priorities as a Christian and my technical work.
Discussion of my work with the Christian community has remained a priority as well. With so much concern on the part of Christians about the poor and about the environment, I have found it surprising that so few Christian economists have entered into the dialogue on these issues. Gordon College and InterVarsity have given me opportunities to discuss some of my findings with undergraduates, and with colleagues from other disciplines. Occasional articles in the ACE Bulletin and other Christian publications (Dean 1985a,b, 1997)7 hopefully contribute to the dialogue among Christian economists as well as the broader Christian audience. In addition, serving on the Board of World Relief Corporation has given me the chance of sharing my understanding of economic development in a broader sense with Christians involved in relief and development work.
IV. A Plea for More Physicians
That there is a critical need for Christians as philosophers should go without saying. It is my hope that this brief reflection has shown that there are at least two other roles for the Christian economist--the physician and the advocate. Since we are especially trained to be physicians, and few of us trained to be philosophers, it is my plea that more of us would take up the role of physician. Our faith will not indeed be visible in the same way it is for the economist-philosopher. But it will be evident.
This article was written while Judith Dean was Associate Professor of Economics at Johns Hopkins University, and president of the Association of Christian Economists. Currently a senior international economist at the US International Trade Commission, Judith will be Professor of International Economics at Brandeis University in the fall of 2010. The views in this article are those of the author alone. They do not represent the views of the USITC or any of its Commissioners.
© 1997 by Judith M. Dean. All rights reserved.