In partnership with CREDO, the Lumen Christi Institute is cosponsoring a monthly invite-only CREDO Economics and Catholic Social Thought Virtual Workshop. The interdisciplinary workshop takes place online the first Friday of each month and features papers addressing the intersecting domains of Economics and Catholic Social Thought. We welcome all papers on this interdisciplinary boundary. Since the primary audience for the seminar is economists interested in exploring these questions, we give somewhat greater weight to papers written or co-written by economists, and to papers written with an audience of economists in mind.

Those interested in presenting or attending the series should contact Andrew Beauchamp (andrew [dot] beauchamp [at] wright [dot] edu) or Andrew Yuengert (andrew [dot] yuengert [at] pepperdine [dot] edu).

Upcoming events

Author: Geoff Friesen (Nebraska Lincoln)
Discussant: Kirk Doran (Notre Dame)
Time: 16 GMT / 8AM Pacific / 10 AM Central / 11 AM Eastern
 
ABSTRACT
     Many firms do not make optimal investments in stakeholder engagement
or higher purpose despite the empirical evidence that it matters. One
reason for this is that stakeholder engagement is missing from most
agency-based models. We present a model of the firm where engagement
emerges conditionally after stakeholder deficiency needs are met, which
is consistent with stages of individual human development and with the
emergence of human needs after the historical period when the
neoclassical finance models were developed. Because justice emerges
simultaneously alongside engagement, the distribution of resources
within the firm becomes an increasingly important catalyst of engagement
and purpose. In equilibrium, the value of the firm depends upon the
connection between engagement and firm productivity, and also whether
shareholders recognize this connection. This study illustrates how
financial models shape the worldviews of their users, and why models
that omit important determinants of value may lead to a self-limiting
mindset and sub-optimal value creation.

Author: Mary Hirschfeld (Notre Dame)

Discussant: TBA

Past events

Author: Maria Noelia Romero (University of San Andres)
Discussant: Tony Gallenstein (Catholic University of America)

Author: Matt Mazewski (Rutgers)

Discussant: Kyle Karches (Saint Louis University)

Author: Andrew Beaucahmp (Wright State)

Author: Sarah Hamersma (Syracuse)

Author: Stephen Pitts, SJ (Minnesota)

Author: Andrew Yuengert (Pepperdine)

Author: Mark Hoipkemier (University of Navarra)

Discussants: Andrew Yuengert (Pepperdine)

You can access the paper here.

Author: Marcus Shera (George Mason University)

Discussants: Michael Thomas (Creighton University) and Ian Gerdon (University of Notre Dame)

You can access the paper here.

Author: Philip Booth (St. Mary’s University)

Discussants: Robert Kennedy (University of St. Thomas); Fr. Martin Rhonheimer (Austrian Institute of Economics and Social Philosophy)

The paper can be accessed here. Interested readers are also referred to a recent article in the Review of Austrian Economics here.

Author: Craig Gundersen (Baylor University)

Discussants: David Cloutier (Catholic University of America) and Tammy Leonard (University of Dallas)

There is no manuscript for this workshop

Author: Catherine Pakaluk (Catholic University of America) and Clara Jace (Samford University)

Discussants: Craig Gunderson (Baylor University) and Christina McRorie (Creighton University)

Abstract: Universal basic income (UBI) proposals raise interesting questions from the economic and ethical points of view. Advocates argue that it will ensure a baseline standard of living for each person, while combating the inefficiency and stigma of traditional welfare programs. Opponents contend that UBI programs are economically unfeasible, unlikely to reduce poverty, and ethically suspect since they treat individuals who choose not to work and those who cannot work as identical. We build a case from both economic theory and Catholic Social Thought to argue that a UBI is an indefensible policy proposal. The fundamental mistake of all UBI programs is that they aim to separate human work from its fruits. This implies that a UBI would not only distort the economic sphere, but political and social life as well. Special attention is given to the implications of a UBI for families.

The paper can be downloaded here

Author: Alejandro Cañadas (Mount St. Mary University)

Discussants:

Martin Schlag (University of St. Thomas)
Joseph Kaboski (University of Notre Dame)

The “Economy of Francesco” (EoF) is a serious and urgent invitation to transform the current economic thinking based on neoclassical economics. In “Laudato Si,” Pope Francis shows us the reality of growing economic inequalities, social and environmental degradation. The Pope shows us an intimate relationship between the poor and the planet’s fragility, our moral behavior (even our sins), and ecological degradation. The truth is that everything in the world is interconnected. In “Laudato Si,” Pope Francis moves our hearts to have an integral, spiritual, and ecological conversion. However, the EoF is a necessary spiritual and intellectual exercise and a real and practical transformation, transforming our current economics and finance methods. After the catastrophic global financial crisis in 2009, in a post-COVID era, this is the ideal time for a great reset in how we practice, live, and teach economics.

The paper can be found here

Author: Sandra Polania Reyes (University of Navarra)

Discussants:

William George, Dominican University

Tilsa Ore, La Universidad de Piura

This article describes and analyzes the interaction between conflict, extractives, and institutions at the intersection of civic participation and pastoral accompaniment in Colombia. For generations, mining has been part of life for many Colombians. After the 2016 accord, many, including the government, counted on mining to deliver a peace dividend. In an effort to accompany local communities, the Catholic Church has responded in a variety of ways to challenges posed by mining.

The study maps and analyzes that Church response. First, we describe the current socio-political context of Colombia. Secondly, we address Colombia’s legacy of mining and the trade-off between conservation and extractive-dependent development in a country with a large degree of biodiversity, a fraught history of violent conflict and social inequity, and large amounts of non-renewable resources. Thirdly, we present a national survey of all ecclesiastical jurisdictions examining the dynamics and impacts of mining, and the responses of civil society and the Catholic Church. It provides valuable data on the extent of mining that is not readily available from the government and other sources. A baseline was conducted in 2013 and a follow-up in 2020. The timeline allows us to analyze changes related to the national peace agreement of 2016. We find a major increase in mining throughout Colombia since 2013. Moreover, the social, environmental, economic, and cultural impacts of mining on communities have worsened. Finally, we analyze the Church’s response to the challenges of mining and describes the resources and tools it has used when accompanying communities in reconciling mining, integral human development, and peace. We complement this section with reflections on how the Church’s response could be improved.

The paper can be downloaded here

Presented by:

Andrew M. Yuengert (Catholic University of America)

Discussants:

William Mattison (University of Notre Dame)

Catherine Pakaluk (Catholic University of America)

This chapter explores the challenge of dialog with economics when much of economic analysis is unable to incorporate neo-Aristotelian virtue. Practical wisdom, and all of the virtues, are made necessary by contingency – the irreducible singularity of circumstance in which people must act. Formal accounts of human action abstract away from contingency, modelling it as analytically tractable probability. A reliance on preference optimization and its assumptions about knowledge appears to be the most important barrier to neo-Aristotelian virtue in economics. The social preference literature incorporates virtue in the form of Humean moral sentiments, but these are not the practical virtues of the neo-Aristotelian tradition. The chapterends with advice on how to make use of social science models while avoiding their blind spots.

The paper can be downloaded here

Presented by:
Andrea Roncella (University of Navarra)
 
Respondents:
David Echeverry (University of Notre Dame)
Samuel Kruger (University of Texas, Austin)
 
The paper investigates how financial innovations undergo a major transformation which results in their initial contribution to the markets, typically achieved by solving classic market failures, being diminished to the point that they eventually aggravate these problems, thereby reducing their own raison d’être. Three cases are analyzed in this respect: credit-default-swaps, the securitization process and the private equity sector. The persistence of a common thread throughout this analysis suggests that the financial sector lacks moral guidelines and principles to mark and indicate the direction to follow for its products to serve society. For this reason, finance needs to be open to proposals that can remedy these defects. In this article, we propose that respect for human dignity, solidarity and subsidiarity – as fundamental pillars of the Catholic social teaching – serves as a possible compass to steer finance toward its ultimate purpose.
 
The paper can be downloaded here.
Presented by:
Andrew Beauchamp (Wright State University)
Jason Heron (Mount Marty University)
 
Respondents: 
Simona Beretta (Università Cattolica del Sacro Cuore, Milan)
Clemens Sedmak (University of Notre Dame)
 
Is there a shortage of good work in the U.S. economy? We examine this question by integrating approaches from economics and theology. Theological reflection provides a biblically and magisterially grounded definition for good work. Descriptive economic analysis using three contemporary datasets suggest the following: recent cohorts have seen declines in job satisfaction, especially concentrated among higher-skill workers. Time-use suggests very similar patterns across cohorts with respect to contemplative activities, with the exception of religious attendance. Opinion data show troubling signs of a crisis of meaning among younger cohorts. The data also provide little evidence that reciprocity in work relationships is on the decline. Given these trends, we offer insights from the theological tradition regarding meaning and work, especially the role that modern education systems likely play in creating the shortage of meaning-filled work. 
Presented by:
Fr. Fidelis A. Olokunboro (University of Notre Dame)
 
Respondents: 
Edwige Asalwe Tia (University of Guelph)
Quentin Wodon (World Bank)
 
 
 
The approach of this essay is descriptive and analytical. This essay evaluates few descriptive analyses of poverty, judges them as inadequate, provides alternative reading and description of poverty. Descriptive analysis is essential to this essay because it assumes that the quality of description of a problem influences the worth of its solution and prescription. The trajectory of this essay moves from the general map of the problem to its economic narrative in the Western and African scholarships. It concludes with a theological description and analysis of the problem.
Presented by:
Masao Ogaki (Keio University)
 
Respondents: 
Jesus Fernandez-Villaverde (University of Pennsylvania)
Mary Hirschfeld (Villanova University)
 
 
 
An important role of normative economics is to provide an analytical framework to evaluate social states. Such an evaluation is based on value judgments derived from moral views of the members of the society. There exist three major approaches in normative ethics, which formalize many people’s moral views. These are consequentialism that focuses on consequences of actions; deontology that focuses on moral duties, and virtue ethics has two important aspects: acquiring virtues and human flourishing that can be achieved by using virtues and abilities. Among these, formal analytical frameworks have been developed for important aspects of consequentialism, deontology, and the flourishing aspect of virtue ethics. However, normative economics does not have a formal analytical framework for the learning aspect of virtue ethics. In this paper we develop such a framework for models with endogenous preferences. We apply this framework to a rational addiction model and an intergenerational altruism model. We find that introduction of virtue ethics can lead to very different policy recommendations than those based solely on welfarism where emphasis is on maximizing social welfare functions. Importantly, in contrast to the commonly held view, we find that incorporating virtue ethics into normative economic analysis may not always lead to greater government interventions.
 
Presented by:
Nils Goldschmidt (University of Siegen)
 
Respondents: 
Peter Casarella (Duke University)
Andrew Yuengert (Pepperdine University)
 
 
 
In the wake of WWII, the economic development of Germany was primarily shaped by a form of economic liberalism known as ordoliberalism, which holds that governments should regulate markets that market outcomes approximate the theoretical outcome in a perfectly competitive market. The paper highlights the various sources that shaped the genesis of ordoliberalism and demonstrates how both continuities and discontinuities need to be taken into account when engaging with the history of economic thought. As such, the ordoliberals’ self-styled demarcation from the German Historical School is critically examined and the many continuities between the two approaches carved out. We also place ordoliberalism as a liberal school of thought with many disagreements with other liberal approaches and locate the main reasons for this in ordoliberalism’s unique epistemological and normative foundations. We argue that the main influence creating a thorough appreciation for the concept of freedom in ordoliberalism are the real-world experiences with the inhumanity of the Nazi regime, which in turn prompted ordoliberalism’s search for an economic and social framework that would allow for human flourishing under prosperous, free and humane conditions. In this respect, the Social Market Economy – as it was established in Germany in the aftermath of World War II – can be understood as a project of peace.
Presented by:
Brian Boyd (University of Notre Dame)
 
Respondents: 
Cristián Hodge (Pontificia Universidad Catolica de Chile)
Catherine Pakaluk (Catholic University of America)
 
 
 
Defrauding a worker of his wages is a sin that cries out to Heaven [Deut. 24:14-15]. At least since Rerum Novarum, Catholic Social Teaching [CST] has argued that justice requires not only paying the agreed rate, but also paying at least the “slender means” which will support the worker’s “honorable livelihood” [§ 20]. Much ethical reflection on globalization and wages has examined what workers are paid in developing countries; in this paper, I will instead consider the effects of globalization upon wages in the United States. I will argue that despite the pressure of wage arbitrage and the need for profitability, it remains possible to offer domestic wages which are both competitive and just.
 
To do this, I will first offer a quick sketch of the just wage’s history, drawing on St. Thomas Aquinas, Msgr. Jack Ryan, and Fr. Heinrich Pesch to illustrate the main relevant aspects of distributive and commutative justice. I will then use the CST principle of integral human development to offer a rough definition of the just wage as indexed to the context-dependent requirements for personal actualization of capacities and participation in social and economic life. Finally, I will argue that the conditions for paying the just wage, so defined, are present in every major sector of the American economy. I will draw on Zeynep Ton’s “Good Jobs Strategy” to argue that paying above the minimum wage, as part of a change in corporate culture, can increase profitability in a range of service-industry firms. And I will use comparative studies of manufacturing in Switzerland, Germany, and other EU regions to show that embracing comparative advantage need not mean the loss of all manufacturing jobs to cheaper workers overseas. While firms may not be able to employ as many people as they previously did, these case studies will illustrate how competitive firms can offer just wages to a wide range of American workers.
Presented by:
Clara Jace (George Mason University)
 
Respondents: 
Robert Tamura (Clemson University)
Fr. Robert Gahl (Pontifical University of the Holy Cross)
 

Presented by:
William Hauk (U of South Carolina) 

Respondents: 
Arnd Küppers (Katholische Sozialwissenschaftliche Zentralstelle)
Claudio Lucarelli (University of Pennsylvania, Wharton)