Articles About Jewish Free Market Economics
R&L: Historically, what has been the influence of Judaism on the development of capitalism?
Sacks: It is important to distinguish between Judaism as a faith and Jews as a people. Both have had an impact on the development of capitalism, in different ways. Judaism did so through its emphasis on work as virtue, made as a necessity, and private property as a precondition of individual liberty. Judaism did not share either the aristocratic disdain for work found in classical Greece or the occasional tendency to other-worldliness found in early Christianity. It saw this-worldly prosperity as a sign of God's blessing, and work as man's “partnership with God in the work of creation.”
The late Milton Himmelfarb, a social commentator and longtime student of the American Jewish community, definitively summed up the Jewish political paradox with his famous aphorism: “Jews earn like Episcopalians and vote like Puerto Ricans.” American Jews, it seems, tenaciously refuse to link their higher income levels with more conservative, or economically liberal (in the European sense), political positions. Recent data indicate that American Jews earn per capita almost twice as much as non-Jews. Yet, they are between 33 percent and 50 percent less likely than American Catholics and Protestants to identify themselves as supporters of the free market.
R&L: There is a recognition by Jewish religious writers that wealth can undermine one’s spiritual well-being. In what way does this occur?
Tamari: Since the need for the possession of wealth is an unlimited one, people will do things to earn that wealth; sometimes those actions are morally permissible and other times this great need for wealth, which can almost never be satisfied, will lead them to do things which are neither legal nor moral. In this way the need for this wealth destroys the moral being. People make war, nations make war, people quarrel with one another, people lie and steal and harm one another, primarily because this need for wealth is the most powerful, perhaps, of all human passions and lusts.
There has been very little work by orthodox Jewish scholars on the relationship among socialism, capitalism, and Judaism. Careful reading of the relevant literature, however, suggests that it is possible to posit five basic axioms of Jewish economic theory from which many economic policy implications can be deduced. Although not exhaustive, our five axioms represent, to the best of our knowledge, the first attempt to formulate a parsimonious list of basic principles that help systematize the foundations of what we are calling Jewish economic theory.
In the inaugural lecture of the Center for the Study of Judaism and Economics at the Jerusalem Institute for Market Studies, Nobel Laureate economist Professor Robert (Yisrael) Aumann talked about the link between economics, Judaism and the current economic downturn. Aumann argues that Judaism subscribes to a market philosophy and contains a blueprint for solving today’s economic woes.