Confucian Political Economy
Political economy is the study of market processes in relation to government, custom, and legal system. Economy and politics interrelate influencing each other. Their specific patterns of interaction can be regarded as a single issue of philosophy. In fact, the study focuses on the development of particular systems, such as capitalism and socialism. It aims at distinguishing the economic methods, the political approaches, and the moral issues which impact the order of the state. There are various teachings which assist in finding the foundations of political economy and defining the study. For example, Confucianism investigates political economy from the perspective of ethics and religious norms derived from the traditions of ancient Chinese philosophy. This philosophy includes all spheres of life, both private and public. The Confucian political economy relates to the market relations based on the power of the authority, which emerges from the adoption of holistic approaches to the aspects of private and public life.
According to Confucianism, the primary moral duty of people is to live according to virtues, which will subsequently put their country in proper order. Harmonious attitude toward business and private life will lead to social, political, and economic advancements in the state. The process of the proper order formation encloses the variety of stages, ranging from the personal changes to the transformations in family, society, and state. Confucians praise self-cultivation which results in the balance between the soul and the physical aspect of the order. The virtues and values of ancient Confucians were built on the pure motives and the moral behavior, which contributed to the development of positive social relations, respect, sincere thoughts, and comprehensive knowledge. In fact, moral virtues served as the background for the formation of an advanced society where the state and ordinary people managed to reach mutual understanding and harmony between political and economic systems. A perfect political economy of Confucianism is a reflection of genuine virtue and sincere souls that work for common good. Confucius believed that the soul of a human being is perfect when he or she has perfect and pure thoughts which originate from the collected wisdom. Consequently, the person can conduct morally good political economy interactions if he/she remains true to the moral principles in different aspects of life. Undoubtedly, a harmonious family builds a perfect and happy society which becomes the foundation for the proper state order.
Confucian philosophy focuses particularly on the issue of relationships in family, society, and government because they define the successful political economy. The interactions should happen in respect of Jen, a virtue associated with goodness, benevolence, and humanity. According to Confucianism, every process and action has a significant impact on other processes and actions. If the family has poor relationships, it can adversely influence the order of the state, its proficiency, and prosperity. Institutions of this ancient philosophy are completely different from the contemporary political relations, which are not contingent on personal morality and social ethics. However, Confucianism proves that the relation between the market and the politics, private and public is direct.
The model of Confucian political economy comprises of social harmony, political order, work and entrepreneurial ethics. Economic success is based on the balance between political and social interactions, while political success depends on the economic conditions. However, the Confucian model in its pure essence and with all the social virtues might seem utopian and unreal, but in contemporary world, it can be associated with utilitarianism. From the Confucian perspective, the market dynamics interrelate with the political order and the system of relations becoming a single unit within the state. Thus, the problem of balance is as essential as the problem of morality because it corresponds to the general standards of cooperation. If people do not behave morally, the market relationships will collapse. In other words, if people deceive their partners and acquire profit dishonestly, economic and political conditions will deteriorate (Lecture 11/13). The contemporary world tends to build independent market relations and to manage the economy without governmental pressure. However, the investigation of one of the oldest political economies explained according to Confucian philosophy, confirms the necessity of an opposite reality.
The political order should be able to enhance the economy. It should be established by the highest moral authority. The good governments should stick to high moral principles, which will help to eliminate corruption, the greatest evil for the both political and market relations. The corruption poses an obstacle for the authority to act for the social well-being and the prosperous political order in general. A good political power should focus on the needs of common people. The code of ethical and moral behavior is much more essential and sufficient in political and economic relations than laws and restrictions. A highly cultivated person with strong standards of morality is a perfect worker in the field of balancing economy and politics. The legal system is unnecessary in such a perfect society. Due to the established political circumstances, the work depends on the highest ethical culture. In Confucianism, the worker should support the life of the family. How he/she provides for the relatives shows whether the society develops as a healthy community. It is related to the earnestness, moderation, and prudence in the use of resources. The worker, who follows Confucian ethics, is moral, devoted, and self-cultivated according to the strict aspects of virtue and discipline. He/she is responsible because of his/her respectful attitudes toward the work, the task, and the outcome.
In the working relationships, which belong to a fundamental part of market interactions, devotion and respect serve as a guarantee from the conflict in the working environment. Furthermore, the Confucian entrepreneurs adhere to market morality. They work enthusiastically being able to efficiently and adequately evaluate the use of resources. They can apply limited resources and produce a great profit. Confucian entrepreneurs accept their professional responsibilities. Moral working tendencies are the source of social harmony, which is necessary for the political economy of Confucianism. The main characteristic of the Confucian political economy is a society where every member respects each other and has kind attitudes. Compassion, one of the vital virtues, is an essential component of humanism and altruism. Confucians teach that the unity of appropriate attitudes and responses lead to solidarity, which is necessary for maintaining common interests and balance in political and economic relations.
Advanced economy and politics consist of the social components. Thus, political economy is defined by their interaction. Confucianism supports the idea of the golden middle, the average position between the extremes. According to the Confucian macroeconomic system, the natural resources exploitation should also be fairly moderate. All the resources should be controlled and used due to the needs because in order to keep the sufficient productivity, it is necessary to distribute the resources wisely. Undoubtedly, the use of the resources is directly related to the production. Thus, the rise of the wages should follow the increase in production. In Confucianism, the efficient production is possible if the proper order of the state derives from the moral relationships, respect, and good authority. The efficiency of the production should be related to the needs of the society. If the state understands them, the economy will become strong and the politics will become comprehensive. The working people can be regarded as the labor resources. In Confucian theory, the demands and the resources interrelate. Thus, if the education is necessary for the self-cultivation, it is also important for enhancing economy not only in the aspect of ethics and morality of market relationships but also in the aspect of proper exploitation of labor and natural resources.
According to Confucian thought, the market prosperity depends on the level of education of the society, which participates in the economic and political relationships. As the entire society contributes to the proficiency in the political economy, the general education is absolutely essential. Furthermore, the concept of decent education for all is appropriate for the contemporary standards. Even though the philosophy of modern people and Confucians are different in nature, the general standards of market relationships as well as proper order resemble significantly. In fact, compulsory education is an important means of maintaining morality for the economic success. The strong and developed economy is possible only due to the support of the governments, which are able to suppress the corruption. The authority can apply effective mechanisms in order to create social, economic, and political advancements only if it adheres to the moral principles and considers the needs of every person.
The political order is a sufficient component of economic proficiency. Similarly to how people enhance their soul and character, the political system should also be cultivated. Confucian political economy sticks to the sophisticated schemes of work, known as rituals. Confucianism tends to promote true justice, developed in the process of the rituals. The government in the face of a single ruler or an entire system with their deputies has to be just. Only when they learn how to conduct properly in private and public life, they will hold the right to be the power of the state. Moreover, they should not only focus on the road to success and proper order but also on the performance of happiness. Aside from the variety of moral teachings, duties, and rituals, people can join the government of the country only within the hierarchical allowance. In the family, as well in the society and in the government, each member has to perform his/her responsibilities due to the position in the society. Only a ruler can be a perfect ruler, as only a father can be a virtuous father. It is a foundation of market and political relations because everyone has to perform his/her work, which corresponds to their status and duties. Confucian state system requires that the economy relates to the politics as the parts of the chain, where each part is essential for the creation of entire unity. The proper rituals should be performed by all the participants of the relationships in order to maintain the effective political economy. The economy and politics in Confucianism belong to the process of social relations with strict rules, subordination, ethics, moral behavior, and responsibilities. The balance of these components can support a proper order in the state as the way to harmony and happiness.
Thus, the political economy in Confucianism is based on the proper order of social, economic, and political aspects, which create the balance of social relationships. All these relationships within the market should be useful for the country and for the society. People should lead a moral life. Moreover, they should be just, educated, self-motivated, honest, and kind to each other. They must cultivate their personality according to moral principles and increase their wisdom, which should serve for the profit of the society. The person should be respectful. He/she should value the family as a primary unit of society. Then, the family should be a useful part of the society, which serves for the development of fundamental political and market relationships.