First Session : Economics and Spirituality: Ethics, Trust and Loyalty in the Marketplace

Speaker: Alessandro Vercelli

Spirituality and economics: the black side of individualism and short-termism

The matching of apparently antithetic terms such as spirituality and economics is a stimulating challenge for an economist. In particular, a reflection on this apparent oxymoron may help us to understand the limits of the recent evolution, or involution, of both the economy and economics.

Spirituality has many meanings. Many of them have a positive connotation, at least in the intention of the user of the term, stressing an orientation towards a superior substance or end. This claim, however, has also been used to justify unacceptable visions and practices such as totalitarian paradigms. It is well known, e.g., that fascist movements often tried to root their views and actions in spiritualist ideologies. In this paper I will give to spirituality positive connotations. To do so I have to give a definition capable to draw precise boundaries separating the positive from the negative connotations of spirituality.

I start from the observation that most definitions of spirituality have in common the reference to something that goes beyond, "transcends", the contingent being of the individual, i.e. his mere existence "here and now" as is accessible through sense experience or introspection. This "transcendence" may be seen from the metaphysical or ethical point of view. Although these two dimensions are strictly intertwined, in this paper I will focus exclusively on the ethical dimension of spirituality. Therefore, in what follows I take spirituality to mean adhesion to a system of ethical values that transcends the contingent existence (here and now) of individuals and goes beyond their immediate self-interest. From this point of view the positive or negative connotations of spirituality depend on how the relationships between the individuals and these "transcendent" values and motivations are conceived. The subordination of choices, including economic choices, to universal ethical principles is an example of what I consider a positive role of spirituality. However, the systematic compliance of individual choices with the "spirit of the nation", or the "spirit of the time" ("zeitgeist") or a social class, are examples of a negative role of subordination of individual choices to superior ends that may be manipulated by unscrupulous elites.

I will consider ethical spirituality from the point of view of individual economic agents and of the restricted horizons of their choices. I will thus analyse in section 2 the pathology and physiology of individual choices from the point of view of the boundaries of their decision horizon. I analyse these boundaries from the social point of view (individualism) in section 2.1, the spatial point of view (localism) in section 2.2, and temporal point of view (short-termism) in section 2.3. These restrictions to the decision horizon have a negative meaning to the extent that they signal a deficit of ethical spirituality. They may also have the positive meaning of solid rooting "now and here" of an open-minded attitude towards values and people who live, or come from, outside the individual boundaries. This attitude of "civilised individualism" must be preserved in order to avoid the distortions that may descend from misinterpreted spirituality.

What can we do to stimulate ethical spirituality in economic affairs? Ethical responsibility concerns individuals not collective bodies, but the institutional and social environment may be more or less conducive to its implementation. In section 3 I discuss the role of two main obstacles to civilised individualism, poverty and income inequality, and the impact on them of the recent process of modernisation. In section 4 I examine a particularly relevant case study: the impact of poverty and inequality on the health of people. In section 5 I analyse in more detail the causes of the growing short-termism that jeopardises the social responsibility of economic choices. In section 6 I consider the relationship between the social responsibility of firms and the ethical motivations of people who have an interest in their performance (the so-called stakeholders). In section 7, the concluding section, I discuss how civic virtues, farsightedness and social responsibility may be promoted and consolidated.

The secular evolution of the economy since the industrial revolution is expanding, in principle, the economic liberty of individuals by increasing the range of available options through technical progress and a progressive increase of per capita income; at the same time, however, new crucial developments of the economy risk to shrink the ethical awareness and responsibility of the individuals. This tendency may be countered by investing in ethical spirituality and social capital through education and a package of practical initiatives, meant to reduce the gap between individual and social interests.