GANDHIAN ECONOMIC PHILOSOPHY
Vs
MODERN CORPORATION PHILOSOPHY
AND
QUESTION OF HUMAN WELFARE
Summary
OF THE
THESIS
SUBMITTED TO THE
UNIVERSITY OF LUCKNOW
FOR THE DEGREE OF
Doctor Of Philosophy
in
PHILOSOPHY
Under the Supervision of
Dr.Rajni Srivastava
By
Sunil Kumar
DEPARTMENT OF PHILOSOPHY
FACULTY OF ARTS
UNIVERSITY OF LUCKNOW
LUCKNOW, U.P. (INDIA)-226007
2013
Topic of Research
GANDHIAN ECONOMIC PHILOSOPHY
Vs
MODERN CORPORATION PHILOSOPHY
AND
QUESTION OF HUMAN WELFARE
Summary of the Thesis
Though it is true that Gandhi was not an economist and corporations
are not any philosophical school of thinking but their effect on the individual
and the society provokes us to interpret their basic assumptions in terms of
philosophy. Here human welfare is in the central place and economics is just
treated as a means to promote the level of human welfare. The question which
is raised here is to find out the rational soundness of both instrumental theories
(Gandhian and corporation) of welfare with their basic assumptions and its‟
consistency with the basic goal of human welfare. My topic of research is
coined by the name „Gandhian Economic Philosophy Vs Modern Corporation
Philosophy and Question of Human Welfare‟. For the investigation of above
earlier discussed question thesis has been arranged in following chaptersCHAPTER-I
INTRODUCTION
In this chapter central question of the research has been raised and
it was tried to make consistency among other chapters of the thesis with
original question of human welfare. Here brief summary of every chapter and
their central theme has been introduced.
CHAPTER-II
CONCEPT OF GANDHIAN ECONOMIC PHILOSOPHY
He did not present his economic ideas in any systemic manner and
at one place. They are basically in the form of interview, speeches and the
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answer to the question. His concept of economic philosophy is basically
derived from his social- political philosophy. In this chapter I have
discussed about these concepts related points Concept of Human Being
In Gandhian philosophy the central conception of individual being
is as spiritual entity, not as economic man. This conception is dominant in
his entire philosophy. His theory stressed much on the replacement of greed
and accumulation by generosity and love which led towards the substitution
of false and non- human economics by true and human economics.
When question is asked about human nature Gandhi emphatically
asserted that “human nature is not essentially evil. One must not despair of
it.” For him man is rooted and springs from the animal world. He has the
capacity to rise above it.
At the risk of some oversimplification, “he thought that three
fundamental facts characterize human beings. First, they were an integral
part of the cosmos. Second, they were necessarily interdependent, therefore,
develop and fells together. And third, they are four-dimensional beings made
up of the body, the manas, the atman, and the swabhava, whose interplay
explains their behaviour and forms the basis of morality”.
Concept of Society and State, and its Relation with Individuals
Gandhi made an analogy between the relation of ocean-drop for
showing the connection between individual and the society. As he says “the
ocean is composed of drops of water. Though each drop is an entity, yet it is
the part of the whole”. On the question of supremacy between society and
individual, Vinoba has expressed that “it is just like walking on two legs”
and it is difficult to say, which is prior. The concept of ultimate authority of
the individual logically paved the way for the development of his non-violent
economic order.
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Gandhi tried to reconcile individual freedom with social obligation.
He rejected the unrestrained individualism that ignores social obligations as
well as the belief that individual is mere a cog in the social machine. In his
own word “I value individual freedom, but you must not forget that man is
essentially a social being.”
He proclaimed two values as ultimate- Truth and Non-Violence.
These could be invoked by every individual in every situation. He believed
that good man should not live in solitude as a hermit but he must be naturally
sociable and active.
According to Gandhi every single act must be independently
justified in terms of ultimate and unchanging value rather than the result that
are expected to emerge. The appeal of the individual must be the lost resort
to conscience. Conscience according to Gandhi is the voice of god, the final
judge of rightness of every deed and thought. In the matter of conscience
majority has no place.
Relation of Economics and Ethics
According to him economic and ethical considerations were
inseparable. Replying to the poet Tagore who had reproached him for mixing
these up, Gandhi wrote: “I must confess that I do not draw a sharp line or any
distinction between economics and ethics. Economics that hurts the moral
well-being of an individual or nation is immoral and therefore sinful.” It is not
legitimate to regard ethical influences simply as disturbing factors that
„prevent economic laws from having free play‟.
Concept of Gandhian Economic Philosophy and Ethical Theories
It is the consequences that he looks rather than to absolute
principles such as the sacredness of life etc. Thus, Gandhi‟s ethical position
is consequentialist. However, he is, sufficiently flexible to accommodate the
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core concern of deontological ethics—that certain moral ends are so
important that they must be treated as nonnegotiable.
Simultaneously he imply that certain actions—such as treating a
fellow human beings as untouchable—could have an infinite degree of
morally evil consequence attached to them. Such actions therefore cannot be
right actions for an agent to perform. In this respect, Gandhi‟s
consequentialism merges into deontology.
Other Philosophical Foundations
“Axiom A-Truth exits in and beyond man in an absolute, eternal, and living
essence.
Axiom B- The purpose of all life and evolution is to realize truth.
Axiom C-While truth is the end, ahimsa; i.e. self giving love is the means.
Axiom D-Human truth is always relative.”
Despite these axioms there are some basic premises of Gandhi‟s
socio-economic thought. Whole concepts of his economic philosophy is
based on these premises “Premise A- economics, ethics, politics and religion constitutes an
indivisible whole.
Premise B-economics is the science of human welfare. Its goal ought to be
sarvodaya, the welfare of all.
Premise C-the supreme consideration has to be man.
Premise D-human welfare economics focusing on what Gandhi called the
„human element‟ implies the crucial importance of a decentralized social
economy.
Premise E-economics has to respect the law of Swadeshi.
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Premise F- at the very core of the Gandhian economics is the concept of
rationality.”
In conclusion it may be said that whole structure concept of
Gandhian economic philosophy is an indivisible unit. We cannot separate
one part to another. His concept of economic philosophy is co-product of
his other conception.
CHAPTER-III
Concept of Corporation Philosophy
The points which I have discussed in this chapter are given belowConcept of Human Being
Adam Smith considered the man as HOMO ECONOMICUS in his
famous work „Wealth of Nations‟. Here HOMO ECONOMICUS means those
people who are rational and calculating. Their rationality is expressed in their
economic behavior. They are motivated by self interest maximization. This
self-interest persuasion leads the propensity in human nature to exchange and
finally the division of labour arises. “This propensity is one of those original
principles in human nature, of which no further account can be given.”
This exchange tendency is naturally found in all human beings.
Ultimately this tendency of exchange increases the wealth of nations. In this
context freedom of commerce and industry is necessary.
Concept of Society and State, and its Relation with Individuals
A number of philosophers have reviewed society as an instrument
deliberately set up by individuals for certain ends. According to some, such
as Thomas Hobbes in the 17th century, society is a means for protection of
men against the consequences of their own untrammeled nature. It is
remarkable that Hobbes made no distinction between state and society. John
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Locke was another supporter of instrumental theory. He maintained that man
was born free and equal in his state of nature and his establishment of social
contract merely set up for social conveniences of order and protection. A
view suggested by the Adam Smith and his followers, society is an artificial
device of mutual economy, All such theories view society as based on some
kind of contract between the individual themselves or between the people
and the government. This view has been used as an argument for the
protection of the individuals from society and sometimes it has been used for
the opposite purpose of enhancing the role of political organization in the
society.
Corporate philosophy accepts this theory of contract for denoting the
relation between state, society and individuals. As smith described, for
corporation “society is an artificial device of mutual economy”.
By using contract theory they prove that their concept of society is
in atomic form not of organic. When they say that society is atomic its mean
it is just a collection of individuals and their wave of relations, deliberately
set up for receiving the benefits of mutual economy.
Relation of Economics and Ethics
As a conclusion about the relation of economics and ethics in
corporation philosophy one may say that it is value neutral but in the
application of various ideals of market it takes value judgements.
Simultaneously, while it operates its various operations it expects about the
moral behaviour of its employees.
Corporation Philosophy and Ethical Theories
The theory of morality which is accepted by corporate philosophers is
known as consequentialist theory because it assumes that if outcomes are
desirable then, that action is morally right: if the outcomes of the action are
not desirable then it is morally wrong. The moral judgment in this theory is
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thus based on the intended outcomes, the aims, or the goals of certain action.
Thus Corporation Philosophy position could be fixed under the topic of
consequentialist theory of ethics.
Other Philosophical Foundations
These social-political ideals played as back bone to determine the
corporation‟s economic thoughtConcept of Right-Natural Right Theory.
Basic Rights(1)Right to Commerce and Industry.
(2)Right to Individual Property.
(3)Right to Individual‟s Personal Life.
Concept of Liberty -Negative Liberty.
Concept of Equality-Equal Political Rights.
Concept of Justice-Distributive Justice by Free Open Market Society.
Concept of welfare
When corporation deals the question of welfare it has some
behavioral answer likeIt provides the cheap and easily available commodities to satisfy
human needs.
It gives the employment to the people.
It gives technology and machines for the progress of civilization.
It gives satisfaction to people according to their ability.
It operates direct and indirect welfare program.
But the criterion for actual welfare which it follows is Pareto‟s
optimal welfare theory. This theory tells us if any system is making the better
off any person without making another‟s life worst off then it would be the
perfect criteria for deciding the welfare of human beings.
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CHAPTER-IV
Economic Philosophy and Concept of Human Welfare
The basic points, which I have discussed in this chapter areUtilitarianism
Utilitarianism is a pragmatic, practical and concrete philosophy
which is dedicated for the continuous elevation in human life. According to
Bentham, “nature has placed mankind under the governance of two sovereign
masters‟ pain and pleasure. It is for them alone to point out what we ought to
do, as well as to determine what we shall do. On the one hand the standard of
right and wrong, on the other the chain of causes and effects. These principles
govern us in all of our actions, thinking and efforts we can make to throw off
our subjection, will serve but to demonstrate and confirm it”. With these basic
lines scholars tried to define the utilitarianism.
Thus pain and pleasure are the supreme criteria to decide the
recommendable/avoidable activities. The political philosophy of utilitarian
view is this that any political action, institution may be recommended if it is
promoting the general welfare in terms of utility.
Utilitarian are individualistic philosophers and they believe that
society is composed of individuals. If individuals are benefited then there is no
need to care for society. Thus total welfare of society is equal to total welfare
of individuals. Any policy, tradition, action or institution is justified if it is
producing maximum utility.
Utilitarianism is generally defined in terms of(1) Consequentalism.
(2) Welfarism.
(3) Sum ranking.
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Welfarism is criticized for ignoring the relevant non-utility
information. If we define utility as “happiness” then the utilitarianism will
count only human happiness in its welfare functions. One side, it will lead to
the degradation of the existence of non-human entities another side it will
undermine the basis of morality.
Gandhian Theory of Human welfare
On the basis of above mentioned points we can say that these points
are the basic points regarding the welfare criteria in Gandhian philosophy1-Without excluding the material well being Gandhian economic philosophy
defined the welfare essentially in moral terms.
2-Minimization of wants rather than given wants may be explained as a
Gandhian criterion of individual and social welfare. The social optimum lies in
complete equality of all individuals. This would bring about the equilibrium
condition of society both, materially and morally.”
3-According to Gandhi maximum social welfare with economic inequality is a
fundamental contradiction.
4-In Gandhian philosophy the notion of social equilibrium has a central place.
He defined social equilibrium as an optimum combination of material and
moral progress.
Rawls’s Human Welfare Approach
He defined the criteria of welfare in the form of justice. He rejected
the utilitarianism because unknowingly it violates the dignity of each and
every individual. Rawlsian approach is generally considered as resourcist
approach because he recognizes that resource of some kind need to be
distributed according to some maximising, or leximining principles.
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According to Rawls each and every person is equally important for
the consideration of concept of welfare. And the mechanism, for applying this
concept is articulated in the form of justice. The principle of justice is basic
theme for the welfare of individual and society. Rawls articulated it in form of
two principles of justice. According to Rawls these principles are the best
possible principle of the justice because common reason of every person has
participated in the formulation of the rules of the justice. Theory of justice
which is necessary for the welfare, articulated by Rawls may be expressed in
this formFIRST PRINCIPLE
“Each person is to have an equal right to the most extensive total system of
equal basic liberties compatible with a similar system of liberty for all.”
SECOND PRINCIPLE
“Social and economic inequalities are to be arranged so that they are both:
(a) To the greatest benefit of the least advantaged, consistent with the just
savings principle, and
(b) Attached to offices and positions open to all under conditions of fair
equality of opportunity.”
The principles of justice are to be ranked in lexical order. This
theory has criricised on various grounds.
Amartya Sen’s Human Welfare Approach
Amartya Sen‟s approach on welfare is known as capability approach.
This approach may be originally found in the writings of Aristotle, Classical
Political Economy and Marx. But recently John Rawls contributed in this
approach by writing his book „Theory of Justice’. Rawls emphasized much on
self-respect and access to primary goods. But, these efforts were not very
comprehensive in the solution of the problem. Capability approach regarding
the welfare addressed all relevant concerns which were either scattered or not
available among various other theories.
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Sen was not happy with the traditional welfare economics. This thing
inspired the development of capability approach in Amartya Sen‟s thinking.
Actually, conceptual foundation of the capability approach is basically a
byproduct of Sen‟s critique of traditional welfare economics. The problem that
lays behind this traditional welfare economics was this that it combined wellbeing with either opulence i.e. income, commodity command or by utility i.e.
happiness, desire fulfillment. But this was not convincible to Sen. Sen
distinguishes between commodities, human functioning/ capability and utility
Sen started his talk by considering income or commodity command.
Following the tradition of Adam Smith, Sen stressed that without economic
growth and the expansion of goods and services human development could not
be possible. Though he always committed his faith for this Aristotelian
statement that wealth is evidently not the good we are seeking; for it is merely
useful and for the sake of something else.
Sen have a deep faith in this thinking that judging the quality of life
we should consider what people are able to achieve. Sen observed it that
individual as well as society differs from other individual or society, in their
capacity to convert income or commodity like means into valuable
achievements.
Happiness, pleasure and desire fulfillment based utility approach was
not convincible to Amartya Sen. He recognized that main lacuna of utility
based theory is this that it does not distinguish between different sources of
pain or pleasure. Therefore it does not care for valid or invalid source of pain
or pleasure. Consequently, unconsciously it paves the way to get pleasure by
offensive taste also like taking pleasure in another person‟s misery.
Amartya Sen clarified that apex objective of life is not to obtain
utility. Happiness or desire fulfillment like utilities represents only one aspect
of human existence. Utility based approach has ignored many other things
which have intrinsic value itself i.e. rights and positive freedom etc.
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These assumptions compelled Amartya Sen to conclude it that neither
opulence i.e. income, commodity command nor utility i.e. happiness, desire
fulfillment constitute human well-being and deprivation. Therefore one must
move towards more direct approach that focuses on human function(ing)s and
the capability to achieve valuable function(ing)s.
Other attempts to Complete Capability Approach
Most effective attempt to complete the capability approach may be
traced in the writings of the feminist philosopher, Martha Nussbaum. Martha
Nussbaum has argued that we need to characterize an objective list of
functioning. The headings of the latest version of this list are:
“1. Life: able to live a life of normal length and worth living.
2. Bodily health: adequate nourishment, shelter and good health.
3. Bodily integrity: free from assault, free geographical mobility.
4. Senses, imagination and thought: basic education and freedom of
expression.
5. Emotions: able to express emotions and develop attachments.
6. Practical reason: able to for a conception of the good.
7. Affiliation: able to live and interact with others, have self-respect.
8. Other species: able to live and have concern for animals.
9. Play: able to laugh and play.
10. Political and material control over one’s environment: able to participate
politically and own possessions.”
Narayan synthesized eighty one assessments of poverty conducted by
World Bank in 50 countries. Narayan suggests that welfare can be seen in
terms of six categories of good:
“(1) Material well-being, including foods, assets and work.
(2)Bodily well-being; being and appearing healthy and living in a decent
physical environment.
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(3)Social well-being: being able to care for and bring up children, having
self-respect and dignity and having good relation with one‟s family
neighbours.
(4)Security: enjoying civil peace in a safe environment with personal
physical security and access to the means of justice, with security in old age
and confidence in future.
(5)Psychological well-being: having peace of mind, happiness and
harmony.
(6) Freedom of choice and action.”
The problem is not with listing important capabilities, but with
insisting on one predetermined canonical list of capabilities, chosen by
theorists without any general social discussion or public reasoning.
U.N. Indicators for Judging Human Welfare
We tend to equate human welfare with material wealth. The
importance of GDP growth and economic stability should not be understated:
both are fundamental to sustained human progress, as is clear in the many
countries that suffer from their absence.
The Human Development Index
This HDI is based on composite measure of three dimensions of
human development:(1) Living a long and healthy life-measured by life expectancy.
(2) Being educated - measured by adult literacy and enrolment at the primary,
secondary and tertiary level.
(3) Having a decent standard of living-measured by purchasing power parity,
PPP, income.
Though this index evaluates human welfare conditions in broader
sphere but it is not comprehensive measure of human development in any
sense because it ignores some other important ingredient of human welfare i.e.
human rights, democracy and inequality.
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Thus we have seen various views regarding the welfare of human
being. Each has taken specific approach concerning the human welfare. Here
it is important to say that though question of welfare is bigger question than
economic philosophy but no theory believes it that question of welfare may be
solved without considering about the economic or material assumptions.
CHAPTER-V
Comparative Evaluation
The main points which are discussed here are.
Comparative Evalution of Concept of Human Being
Thinkers of both philosophies draw an incomplete picture of
individual being. Gandhian ideology, tries to broaden the spiritual sphere of
individual being but during such efforts it confines the material aspect of
individual being. On the other hand, corporate thinkers try to develop the
material aspects of human affairs and present a new idea of homo
economicus. They say that, man, when inspired by self-interest motivations
he goes towards rationality. In this reference they quoted the Adam Smith.
But it is remarkable that Adam Smith quoted the homo economicus in a very
specific reference.
Actually at certain level, we may denote, not define, individual
being in terms of their potentials, it means man could not be defined in terms
of its characteristics but it only could be indicated by its characteristics.
Comparative Evalution of Concept of Society and State, and its
Relation with Individuals
Gandhi is known basically as „philosophical Anarchist.‟ It means he
was against the state because Anarchist never accepts the existence of state.
For rejecting the existence of the state Gandhi have a strong argument. He
considered that state is a soulless institution whether each and every individual
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is characterized with soul. So, soulless institution could not be master of
soulful.
Corporate thinkers conceive it that contract theory articulates about
the assumptions of the existence and nature of state and society. This theory
says that on the basis of contract, society or state came into the existence. Thus
these thinkers divided into two first those who accepts it that only state is an
artificial device. Second, those who accepts it that state and society both are
artificial device. But one thing is common in both kind of thinkers is that state
is an artificial device. Therefore, it should not have supremacy of state over
the individuals.
These thinker accepted it that form of society is atomic not organic.
It means it is made of individuals it don‟t have any separate existence from the
individuals and individual interests should not be scarified on the basis of
supremacy of state or authority.
Thus we see that individuals are the supreme consideration for the
Gandhi and corporate thinkers. Though they have started their journey from
same points but they have promoted different kind of consequences.
Comparative Evaluation of Other Philosophical Foundations
Actually differences between Gandhi and corporate thinkers
grow by their concept related to the relation of economics and ethics. For
Gandhi economics and ethics are inseparable but corporate thinkers assume it
that ethics is neutral to the economics. Though, both kind of thinker assume it
that economics is a science of welfare. Both are agree on this point that human
beings are supreme goal for economic activities. But despite these agreements
they have a lot of differences due to their different philosophical perspectives
of thinking. For Gandhi ethical ideals were prominent but for corporate
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philosophers social political ideals are more important than ethical ideals. That
is why they reach on a different conclusion.
Corporate thinkers gave more importance to individual liberty and
cheap commodities but in Gandhi, human dignity and autonomy are placed
on Apex place. This thing decided their thoughts regarding the relation of
business and ethics. For Gandhi nothing is beyond the ethics but for
corporate thinkers ethics and economics have independent sphere of content.
One cannot apply ethical norms absolutely in the business. For Gandhi
economy must follow the values of truth and Non-violence but for corporate
thinkers economy must follow the value of individual freedom, free and fair
contract etc.
Comparative Evalution of Concept of Welfare
Gandhi expressed his view of welfare in concept of Sarvodaya,
where, he targets all round development of all, moral as well as physical. He
wanted to apply this in all sphere of life. Here it is remarkable to say that
corporate thinkers were followers of neo liberal faculty of thought that is why
they rejected the job of welfare as a separate task but they are saying that if
market works properly welfare of individual may automatically takes place.
As a result of their faith in market system, they accepted the Pareto-Optimal
theory as a criterion for welfare. This optimality accepts it that welfare would
be optimum at that level where it will not be done at the price of someone else.
Lastly the topic of man machine dilemma and welfare of human being has
been raised. Gandhi agrees on this thing that machine is a time and effort
saving device but corporate philosophers accepts it that it is a money saving
device also. Gandhi imposes certain guidelines for the use of machinery where
as corporate thinkers are not in favour of imposing any restriction in the use of
machinery.
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CHAPTER-VI
CONCLUSION
According to Gandhian economic philosophy individual being is a spiritual
entity but for corporate thinkers man is an economic man. Actually it is very
difficult to define the human nature by single term. These characteristics
would be one dimension of human nature but it could not be complete
characterization of human nature.
Though both schools were agree on this point that state and society is
merely an instrument of human welfare but their nature of state and society
was different to each other. Gandhi was philosophical anarchist but he
accepted the existence of state as a requirement of practicality. Liberalist
philosophers were also accepted the existence of state but as a necessary evil.
As a Conclusion we may say that regarding the origin and nature of state and
society both kinds of thinkers have different perspective of thinking and
thought and therefore no one may prove as wrong or write.
Regarding the relation of economics and ethics we can conclude it
that if economics always care for ethics then it would not be developed as
efficient instrument of human welfare simultaneously, if it always rejects the
ethics then it would be science of welfare for only few people.
When one talks about the philosophical foundation of their economic
thoughts it easily can be seen that Gandhian thrust was on ethical ideals but
neo liberal thinkers considered about social political ideals. Gandhi is usually
considered as a philosophical anarchist. Neo liberal thinkers tried to draw a
line for social-political institution so that individual may embodied full
potential of his capabilities. Gandhi defined the individual capabilities for the
sake of society but corporate thinker defined the individual capabilities in
terms of their own.
Corporate philosophers adopted the „Pareto optimal theory‟
regarding the welfare this theory says that the point of welfare would be
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optimum where anybody is benefited without harming any other person. It
means if anybody is growing without harming anybody else, he is doing his
welfare and when such activity occurs on larger basis this is the best situation
for the welfare of the society. Because social welfare is a collection of
individual's welfare.
Corporate philosopher talks about the market society because this is
the optimum place where individual activities produce maximum general good
of society. This market system is a best suitable place for individual liberty.
Simultaneously it is the best place for the award of social goods. So, from the
point of distributive justice market is the best place because it works without
discrimination. Most powerful argument in favour of market that is given by
corporate philosophers is this that it makes automatic adjustment among
various activities of individuals.
Actually, it would be very useful to establish a powerful state to
provide the required level of all possible aspects of welfare because each and
every individual would not be in the position to fetch all aspects of welfare.
Simultaneously it may not be ignore to develop the individual capacities
because it is the individual awareness that defines the limit of the state power.
One cannot avoid it that such a powerful state would always create threat to
individual freedom that is why one must have to talk about the question that
how to ensure the responsibilities of such a powerful state in effective manner.
As the final comment on the thesis it may be said that Gandhian
philosophy is like a moral engine and corporate philosophy articulates about
the mechanism. And if we try to put the engine and mechanism together then
it could be best possible situation for human welfare. I tried to examine this
conclusion before concluding the thesis but I got it is not possible because
each group of thoughts have their own logic, epistemology, metaphysics and
ethics. It is no possible to make a cut paste program. We have only this option
that either we may accept them or we reject them.
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