John Calvin as behavioral economist

by on July 9, 2009 at 7:23 am in History, Religion | Permalink

Tomorrow marks the 500th birthday of John Calvin.  If you read John Calvin you will find a great deal of what we now call behavioral economics.

He wrote about non-convexity:

For there is no medium between the two things: the earth must either be worthless in our estimation, or keep us enslaved by an intemperate love of it.

Here is one reason why there is "evil" in the world:

Whatever be the kind of tribulation with which we are afflicted, we should always consider the end of it to be, that we may be trained to despise the present, and thereby stimulated to aspire to the future life. For since God well knows how strongly we are inclined by nature to a slavish love of this world, in order to prevent us from clinging too strongly to it, he employs the fittest reason for calling us back, and shaking off our lethargy.

Adam Smith and David Hume were influenced by Calvin:

If we see a funeral, or walk among graves, as the image of death is then present to the eye, I admit we philosophise admirably on the vanity of life. We do not indeed always do so, for those things often have no effect upon us at all. But, at the best, our philosophy is momentary. It vanishes as soon as we turn our back, and leaves not the vestige of remembrance behind; in short, it passes away, just like the applause of a theatre at some pleasant spectacle. Forgetful not only of death, but also of mortality itself, as if no rumour of it had ever reached us, we indulge in supine security as expecting a terrestrial immortality.

It is odd to call someone so famous an "underrated thinker" but indeed Calvin is.  You'll find the whole text of the Institutes of Christian Religion here; it makes for good browsing.

This chapter is John Calvin imitating Robin Hanson.

Buy the book here on Kindle for 99 cents.

1 nelsonal July 9, 2009 at 7:58 am

What has been will be again, what has been done will be done again; there is nothing new under the sun. Is there anything of which one can say, “Look! This is something new”? It was here already, long ago; it was here before our time. There is no remembrance of men of old, and even those who are yet to come will not be remembered by those who follow.

Ecc 1:9-11. 🙂

2 songar July 9, 2009 at 10:27 am

When one is absolutely certain that one’s views are correct, persecution of the ‘other’ becomes acceptable and, indeed, necessary.

3 Candadai Tirumalai July 9, 2009 at 11:06 am

I have heard that Calvin’s theology has indirect
consequences for economic behavior, where one
postpones gratification not just from earth to
the heaven that is to come but from the instant
gratification of desire (immediate spending)
to savings and capital formation. And worldly
prosperity came to be taken as a token of divine
Grace: one may not have conquered sin but one
has kept it a tolerable distance. I believe his
ideas played a part in what was called “the
Protestant ethic”. Both Adam Smith and David
Hume were fromScotland, where Calvinism hs been
a powerful influence. New England Puritans and
later the Scotch-Irish brought it to America.

4 JAK July 9, 2009 at 11:14 am

So is it the idea that if we did not have to die, then due to our “slavish love of this world” we would cling on to material things harder.

I somehow always thought this would be opposite. If we did not have to die, then we have all the time in the world and may actually spend more time in present than keep looking into future to gain more and more before time runs out. Is there any reserch on this?

5 J. Bogart July 9, 2009 at 12:07 pm

Calvin influenced Hume? That is an interesting claim. It does not show up in the Hume bios I’ve read, nor the philosophical analyses. Given Hume’s theories, it would be a surprising connection. I am curious, what leads you to the suggestion?

6 songar July 9, 2009 at 1:11 pm

“In the matter of persecution, couldn’t one interpret both the actions of bin Laden and our various responses to them as fundamentally the same thing?”

Well, let’s consider 9/11. That was an attack, ostensibly based on the fervent, fundamental belief that the US is evil. The response (had it been appropriately and effectively focused) would have been a defensive response. . .aimed at protecting what we fervently believe.

It would seem that “stop[ping] you from doing what you are doing by whatever means necessary” is not “fundamentally the same” if the act of “stopp[ing] you” is defensively rather than offensively motivated.

7 Brian July 9, 2009 at 3:47 pm

Whoa!!! Tyler! Calvin as a behavioral economist?! This may explain why I find behavioral economists so unhelpful. Calvin’s attitude is expressed by him as the “disadvantages of prosperity” blind us to accepting death when “He” calls.

If economics is anything it is about living, striving, acting to meet our needs. Calvin is all about the “here after.” Surely he is an intellectual dead-end as regards economics.

But to the extent he did influence Hume (beauty is in the eye of the beholder) and Smith (the labor theory of value), that may explain why these men led us down the wrong path regarding value. A path that led to Marx and communism and the deaths of millions of people in the 20th century. A result that certainly accelerated the populating of Calvin’s “here after.”

Perhaps this is why economics is sometimes called the dismal science. Tyler, its time to leave this and classical economics behind and embrace the life affirming Austrian economics.

8 Dennis Tuchler July 9, 2009 at 5:28 pm

I find Paul and Calvin a mite confusing with respect to justification. If justification comes by faith, and faith is a work of the believer, then we are justified by what we do. But grace is a gift of God and that grace is ours (or not) without regard to our works. So why doesn’t grace work without faith? Surely, faith works without resulting in the gift of grace, doesn’t it? If that is so, why bother to do anything but seek your own good?

9 Barkley Rosser July 9, 2009 at 6:25 pm

Servetus is claimed by modern Unitarians as their founding martyr.
He was accused of being a Jewish and Muslim agent, among other
supposed heresies. The Socinian and Unitarian churches of central
and eastern Europe are his immediate followers, not so much the
Unitarians of Britain or the US, who came on the scene much later.

10 Dennis Tuchler July 11, 2009 at 3:38 pm

If faith is a gift, and not a product of a person’s own will, why did Paul exhort the members of his communities to have and cultivate faith in Jesus? If it’s a gift of god, should it not be automatic? On the other hand, Paul sometimes talks of faith, sometimes of grace.

Calvin and his followers had another point that confuses me, one taken from occasional statements in II Kings and in the various prophets of the Hebrew bible — that god controls what we do and has a plan for all things. What happens to free will and the ability to sin?

Think about this enough and you are encouraged to think of other things — hence, good business and many children.

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12 how to grow taller 4 idiots October 10, 2010 at 1:20 pm

Because we know we are right and you are wrong, we will stop you from doing what you are doing by whatever means necessary. It seems to me that logic is utilized by followers of every creed, including “no creed.”

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