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How Can We Apply Buddhist Principles To Our Economic Model?


Buddhism is not separate from economic life and, in fact, putting its precepts into practice can lead us to a more compassionate economic model.

Are religion or metaphysical thinking separate from the economy? Under normal, common sense conditions, we could say yes, that each is only concerned with its own affairs, that praying or meditating are actions that are very different to buying merchandise or paying for a service.

Everything is part of life, however. There is a connection between events in the world and the actions of an individual, and although it may not sound very clever, that connection is the individual. The economy is not an isolated territory, but quite the opposite, one that exists in part due to our day-to-day decisions.

With this premise in mind we can begin to think about a Buddhist perspective of the economy. As we know, Buddhism is a renouncing of the world and its demands, the dissolution of the desires of the individual into collective well-being, respect for all living things and other precepts that, by simply mentioning them, reveal the stark contradiction with the system of production in which almost all of humanity has lived for more than five centuries. Capitalism foments division, individualism, competition, accumulation, destruction, immediate satisfaction and other behavior and practices that are a long way from favoring our spirituality. And so how is the Buddhist economy?

One of the first people to talk about this idea and conceptualize it was Ernst Friedrich Schumacher in 1955 after spending some time in Burma (now Myanmar). As a result of his experience, Schumacher wrote an essay that, controversial at the time, has become influential with the passing of time, largely because it sought a synthesis between the foundations of Buddhism and the material demands of life. To appreciate the risk the economist took on, read his musings regarding the work:

There is universal agreement that a fundamental source of wealth is human labour. Now, the modern economist has been brought up to consider “labour” or work as little more than a necessary evil. From the point of view of the employer, it is in any case simply an item of cost, to be reduced to a minimum if it can not be eliminated altogether, say, by automation. From the point of view of the workman, it is a “disutility”; to work is to make a sacrifice of one’s leisure and comfort, and wages are a kind of compensation for the sacrifice. Hence the ideal from the point of view of the employer is to have output without employees, and the ideal from the point of view of the employee is to have income without employment.


The Buddhist point of view takes the function of work to be at least threefold: to give man a chance to utilise and develop his faculties; to enable him to overcome his ego-centredness by joining with other people in a common task; and to bring forth the goods and services needed for a becoming existence. Again, the consequences that flow from this view are endless. To organise work in such a manner that it becomes meaningless, boring, stultifying, or nerve-racking for the worker would be little short of criminal; it would indicate a greater concern with goods than with people, an evil lack of compassion and a soul-destroying degree of attachment to the most primitive side of this worldly existence. Equally, to strive for leisure as an alternative to work would be considered a complete misunderstanding of one of the basic truths of human existence, namely that work and leisure are complementary parts of the same living process and cannot be separated without destroying the joy of work and the bliss of leisure.

The contrast is diametrical. While in capitalism the logical consequence of work is alienation, disassociation between the person and that in which they employ their time and resources, Schumacher puts forth an idea of work in which it has an existential significance for those that do it, a labor that is transcendental for their life.

But what about merchandise and the cult it is afforded in capitalism, to the extent of fetishism, according to the Marxist term? What about the egotistical ambition with which the economy is managed, at almost any level, that makes earnings almost the only parameter that dictates the success or failure of a business, without the lives that it costs or the natural resources that are destroyed on the way being of any importance? What about the needs created and the false desires that we believe are real and are ours, and the putting into practice of which maintains the machinery of production and consumption well oiled?

For each of these situations, the Buddhist economy offers an alternative:

  1. Individualism opposes the “anātman,” the belief in the non-self, which in this case favors generosity and collective effort.
  2. In the face of the maximization of earnings, the Buddhist economy opts for the reduction of suffering, in both living and non-living beings.
  3. Buddhism combats desire and accumulation with simplification. When our desires are elemental, their satisfaction is simple.
  4. For the saturation of the market, the Buddhist economy proposes the reduction of violence. If the economy were ruled by “ahiṃsā,” no procedure would be put in place that implied violence against others.
  5. For pragmatism and the instrumentation of all relationships, including human ones, the Buddhist economy prefers human consideration in each one of the elements implied in a process. To the “more is better” of capitalism, Buddhism proposes that less is more, and more beautiful if smaller.
  6. Finally, in the face of the pursuit of Gross Domestic Product, Buddhism prefers to improve the index of happiness.

This brief summary appears to give the impression that the Buddhist economy is only possible in opposition to capitalism or other economic models. However, to this respect it is worth quoting the Latin phrase “ex nihilo nihil fit,” or “nothing comes from nothing.” If one day the economic system in which we live were transformed into a more compassionate and more humane one, it would not be by chance, but as a result of the daily decisions that we take, and that is also taught by Buddhism.

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