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Peter CollinsPeter Collins is from Ireland. He retired recently from lecturing in Economics at the Dublin Institute of Technology. Over the past 50 years he has become increasingly convinced that a truly seismic shift in understanding with respect to Mathematics and its related sciences is now urgently required in our culture. In this context, these present articles convey a brief summary of some of his recent findings with respect to the utterly unexpected nature of the number system.

The Economics Problem

The Need for an Integral Approach

Peter Collins

Conventional economics is rooted in a series of outdated assumptions that reflect a reduced scientific approach to human behaviour. With the full impact of the Information Revolution yet to be experienced, it is perhaps appropriate that we now start reinterpreting these assumptions from an integral perspective.


Economic relationships play a key part in our lives and the pursuit of meaning. In modern economies a wide range of consumer goods and services can be provided with the capacity to greatly enhance general living standards. The corresponding production of these commodities accounts for a considerable amount of our activity so that we can earn sufficient income to participate in the consumer society and also as an important contribution to social and work fulfilment. Furthermore the distribution of income has a significant role to play in determining the nature of our participation in the economy and in society generally. And it has to be said that considerable disparities exist in the manner of the distribution of economic resources both within and between countries throughout the world. Besides being crucially important in their own right, economic relationships also exercise a considerable influence on other vitally important relationships in society e.g. political, educational, legal, social, cultural, and even religious. [1]

Therefore an integral approach to development that is practically relevant must seriously address the critical role of Economics - at so many levels - in modern life.

Brief History of Economics

Though economic activity necessarily exists even in the most primitive of societies, both the manner of its understanding and organisation has considerably changed in recent centuries. [2]

Earlier thinking on economic issues e.g. by the Greeks was intrinsically of a more integral nature than the present conventional wisdom. Because it did yet exist as a separate discipline, economic issues were generally considered in their wider context where philosophical, social and ethical issues played an important part. Though on occasion special consideration was indeed given to certain important topics e.g. trade, the overall approach remained unchanged for many centuries. [3] For example in the middle ages one key economic concern related to the “just price”. Another related to the practice of “usury” i.e. charging interest on money, which was considered immoral. So the treatment of both of these issues clearly reflected the primacy of ethical concerns.

However by the late 18th century two significant developments were to greatly alter this approach. Firstly - reflecting the influence of Newton - a new analytic type of science (increasingly separated from the other aspects of understanding) was emerging. [4] Secondly the fundamental mode of productive organization was changing radically as a result of the Industrial Revolution, which had the potential to greatly increase national wealth. Not surprisingly this led to a need to re-examine economic activity in the light of these changing circumstances. However this time - under the Newtonian influence - Economics now became substantially differentiated from other understanding (such as ethics and philosophy) as an activity to be studied in its own right in a scientific manner. Though this differentiation was initially necessary leading to considerable developments in interpretation with respect to the detailed workings of the economic system, it did however represent a regression with respect to integral understanding (where economic activity is necessarily interdependent with all related activity).

The impersonal view for example during the Industrial Revolution that labour was a cheap economic resource to be efficiently exploited in the generation of new wealth was associated with human misery on a grand scale. Not surprisingly this provoked an “integral” counter reaction to the grave social injustice committed in the name of the new doctrine. Karl Mark - despite important faults in his economic analysis - is perhaps the greatest “integral” economist in that he sought to interpret the overall dynamic evolution of the capitalist system with a depth of insight that has never been matched. [5]

Indeed two of the most influential books ever written relate to Economics. The first of these, Adam Smith's “The Wealth of Nations” has provided the blueprint for the free enterprise model of the economy. The second, "Capital" by Karl Marx provided a corresponding basis for the key socialist model. [6] It is interesting how each of these books approaches economics from opposite extremes. Adam Smith's view - based on the primacy of the individual, - is associated with the scientific paradigm in that it attempts to analyse economic events in a somewhat impersonal fragmentary manner. Here everyone is understood to be motivated fundamentally by self interest (without real collective concern). However due to the operation of the invisible hand of the market i.e. the price mechanism, together they are led to work for the common good. However, even accepting the considerable benefits of market competition, this represents a very reduced notion of social identity. Karl Marx's view by contrast owes much more to the dialectical philosophical approach of Hegel (though backed up by rigorous socio-economic analysis). Unfortunately in practice this more “integral” approach has often led to the opposite extreme with a reduced emphasis on the overall collective unit in society (associated with insufficient regard for individual concerns). So capitalism has no monopoly on injustice. Terrible crimes have been committed in the name of socialism. In any case a considerable evolution in the capitalist system has taken place since the Industrial Revolution, so that most Western countries now adopt “mixed” economies that have successfully adapted to deal with many social concerns. Also in general “state socialism” - certainly in its more extreme forms - has not worked as witnessed with the mass dismantling of Communist regimes in the former Soviet Union and Eastern Europe in the 1990's. At present the predominant type of worldwide economic system lies much closer to the thinking of Adam Smith than Karl Marx. So Economics - as taught in the schools and Universities of the West - is largely synonymous with the “free market” economics as espoused by Smith over 200 years ago. [7]

However while duly acknowledging the great benefits that have flowed from this approach, even in the most developed economies many deep problems remain. Also, though economies have indeed evolved considerably, the fundamental interpretation of human behaviour on which modern Economics is based has remained largely unchanged since its inception. Indeed it has become so deeply embedded in conventional understanding, that most economists are incapable of considering alternative concepts that are properly consistent with actual behaviour. So from an overall holistic perspective, conventional appreciation is deeply flawed as an explanation of human activity.

An integral approach to Economics therefore must start with a fundamental look at its most basic assumptions.

Science and the Three Fundamental Polarities

I have been at pains to show in other articles how all relationships in development are necessarily conditioned by the three fundamental polarities that have both a (linear) differentiated and (circular) integral interpretation. So at a (horizontal) heterarchical level we have the interaction of exterior and interior (and interior and exterior) aspects. In (vertical) hierarchical terms we have the interaction of individual and collective (and collective and individual) aspects. Finally in (diagonal) terms (both heterarchical and hierarchical) we have the interaction of form and emptiness (and emptiness and form). So full mature development requires that we successfully differentiate these aspects and then properly integrate (what has been differentiated) with respect to all three polarities.

Now, because conventional analytic science seeks to remove uncertainty, due to the dynamic interactions between poles, it substantially reduces therefore the three aspects in terms of each other.

So for example with respect to the horizontal aspects, conventional science attempts to understand (exterior) physical reality as if independent of the (interior) psychological observer. This leads therefore to a belief in the direct correspondence as between what is observed in (exterior) terms and its corresponding (interior) interpretation. [8]

Furthermore with respect to the vertical (hierarchical) polarities, such science offers a very reduced notion of the relationship between whole and part where the collective whole is viewed merely as the aggregate sum of the individual parts (and in like manner the individual unit is viewed unambiguously as a fractional part of the collective whole). Finally with respect to the diagonal (heterarchical and hierarchical) aspects, emptiness is substantially reduced to form with the focus solely on identifiable phenomenal features of reality. [9]

Though human behaviour does not operate in the predictable manner of many natural phenomena, economics has long prided itself as the most scientific of the social disciplines. Not surprisingly therefore the reduced assumptions of conventional science are deeply implicit in the very manner in which economists tend to view reality.

We will now explain in more detail how such limited assumptions with respect to the three polarities leads to considerable reductionism and a fundamental orientation in economics that is greatly lacking from a genuine holistic perspective. The corresponding starting point therefore for a truly integral approach requires the reinterpretation of the fundamental economic relationships (with respect to the three polarities) in an inherently interactive fashion.

Economics: relationship with the environment

As we have seen the first polarity relates to the relationship between interior and exterior (and exterior and interior) aspects.

The attempted separation of these aspects is evident in the manner in which conventional Economics views nature (exterior reality) in an impersonal fashion as an asset to be exploited for economic gain. So the basic inputs (i.e. raw materials or natural resources) for production are provided by nature. Human resources of course are also required. However - despite great improvements in the workplace - labour is essentially viewed in the market economy as an input to be exploited for profit. Thus typically when a company needs to reduce costs, downsizing through making workers redundant is considered as a ready option. And to be fair in the market economy, as we know it, survival does indeed often require such a course of action.

The reduced way in which economist look at man's fundamental relationship with the environment has very damaging consequences. It may initially seem valid to view the human self as personal in opposition to a natural world that is impersonal. However healthy interaction requires that the two-way nature of this relationship be maintained. Quite simply - because the essential qualitative nature of our relationships comes through interaction - when we attempt to view nature as merely objective and thereby separate, it becomes alien to us. In like manner we too in subjective terms become alienated from the environment. So in truth nature has both personal and impersonal aspects. However by viewing it as an objective resource to be exploited, the sacred nature of our relationship with the world is thereby sundered. Not surprisingly through breaking this connection we can thereby become estranged, cut adrift in a world that has lost its essential meaning.

The distorted economics view of our fundamental relationship with reality can be seen in other ways. For example according to economists, utility - which corresponds to satisfaction and ultimately happiness - is derived from goods and services. This corresponds directly with the misguided materialist view that meaning in economic terms comes from the goods and services that we purchase. In other words economics directly fosters a merely reduced quantitative notion of meaning. It then puts forward - consistent with this quantitative notion - the misleading materialistic view that overall economic meaning (i.e. total utility) can be increased without limit through acquisition and private ownership of an ever-greater number of goods and services. However as we can see from the experience of affluent societies the truth is somewhat different. Though people here are indeed in a strong position to substantially fulfil their material needs, the attainment of this goal is often associated with considerable restlessness and futility through growing lack of a deeper sense of meaning. In other words materialism when unchecked breeds a chronic form of alienation where despite all our possessions we become as strangers no longer at home in the world.

As true meaning resides in the balanced maintenance of the quantitative and qualitative aspects of a relationship, such meaning is thereby greatly reduced when we interpret this in a distorted manner. So in Economics we have an unbalanced dichotomised view where the desire for goods is located with the interior subjective side of personality and the actual fulfilment of these desires located with the objective environment in the ever-greater possession of goods and services. So utility or economic meaning is measured in merely quantitative terms. [10]

A corresponding distortion applies in the Economics treatment of the subjective attitude to work where is viewed as a disutility, which must be compensated for in the form of monetary payment (or other benefits). For example economists often speak of the trade-off as between work and leisure, with the assumption that as one naturally prefers more leisure that extra monetary compensation must be given to do additional work. However once again this offers a fundamentally distorted view of the true nature of work. Of course many jobs are very tedious offering limited potential for fulfilment. Also beyond a certain point e.g. where one is already working long hours, additional leisure may indeed be very attractive. However work can in practice play an extremely important role in our quest for meaning offering the opportunity to develop and practice certain skills, achieve recognition, develop new talents, enter into social contacts etc. So to start by viewing work as a psychological disutility that most thereby be compensated for through monetary payment is fundamentally unbalanced. Not only of course does a distorted notion of the relationship as between interior and exterior aspects of reality have considerable implications in human terms, but also it can lead to considerable damage with respect to our treatment of the natural environment.

Even conventional economists now accept that significant environmental cost implications can attach to economic decisions. However the attempt to accommodate this realisation within the very set of assumptions that gives rise to the problem, does not offer any real hope of a solution.

For example economists speak of externalities associated with the wider effects on the environment through the activities of agents such as firms. Some of these may be indeed be positive. For example the opening of a new rail line benefits not only those who directly use the service, but also those road users who can now travel with less congestion. However in other cases these externalities are frequently negative as for example with pollution such as acid rain that can damage lakes, rivers and tree life over wide geographical areas. So therefore through the incorporation of externalities in the costing of economic activities, concern for the wider environment can be seemingly accommodated within the ambit of free market decisions. However such thinking is very short-sighted for the very mind-set on which free market commercial activity operates by it very nature is not geared to recognize external effects of a more long-term variety. This is especially so when these effects are of a qualitative rather than quantitative nature. Also as many of the major threats to the environment are to the overall planet (e.g. global warming and depletion of the ozone layer), their management requires a truly unified worldwide response. However as the very nature of the market system is based on competition, some countries will always seek a short-term competitive advantage. So for example, present US policy is based on an approach that largely ignores the environmental consequences of economic decisions.

Even where green issues are seriously addressed as for example within the EU, a fundamental conflict exists as between the economic goals of the free market and such environmental concern. In other words the demands of economic progress (in the short-term commercial sense) always tends to outweigh the capacity to move with respect to green issues (even when genuine concern is evident). So at best given the mindset of conventional Economics we can only hope to ameliorate to a limited extent the growing global damage caused through worldwide economic activity without really addressing the root source of the problem (which lies in an unbalanced - merely impersonal - scientific appreciation of nature).

Concept of scarcity

From the conventional economics standpoint the fundamental concept is scarcity. This is based on the initial assumptions that whereas human economic wants (i.e. the desire for goods and services) is unlimited the actual means to satisfy these wants (i.e. economic resources) is limited by nature.

Thus - according to received wisdom - a scarcity of resources will inevitably exist in any economic system (however affluent it may be). This constitutes therefore the fundamental economic problem requiring the making of rational choices in an attempt to efficiently allocate these scarce resources.

So in the manner in which it is conventionally understood, the economic problem i.e. of scarcity of resources, though it can be lessened through economic progress can never be ultimately solved (for any society). Secondly, because happiness or well-being in economic terms is defined through the individual decisions to accumulate more goods and services, this entails an unequal power struggle in society between those relatively well-off (still striving for more) and those without means who are effectively denied the opportunity to compete. This is then compounded by the fact that in so many ways social status in a materialistic society tends to be directly related to earning power. And there should be no surprise in this once we grasp the implications of the basic assumptions on which conventional Economics is built. Indeed but for the survival of a spirit of human decency and a capacity for concern for others (not envisaged by the economists) the level of social injustice would be much more intolerable.

However this initial assumption - relating to an inevitable scarcity of resources in economic society - is fundamentally unbalanced, where once again a clear dichotomy is drawn as between the exterior (objective) and interior (subjective) poles of behaviour.

Once again, though human desire (in economic terms) is identified with the interior (subjective) aspect of personality, the actual satisfaction of these desires is envisaged in merely exterior (objective) terms through the provision of an ever-increasing level of goods and services. Thus the standard measurement of economic well-being (e.g. GDP per capita) is based on a merely quantitative measurement of the overall amount of economic resources produced (without any specific attention to the manner in which such resources are distributed). However the notion that human welfare in any meaningful sense can be directly identified with accumulation of an increasing variety of goods and services is quite untenable. Indeed it directly leads to the materialist conception of life that is ultimately lacks any real substance. And let's be clear here! While acknowledging the wonderful benefits that can come from an increased level of economic resources, I am strongly questioning the misguided economics assumption that somehow human meaning can be identified with (dichotomised) material possessions. Rather it comes from the nature of our relationship with such possessions (which entails the interaction of both exterior and interior aspects). And only when we can maintain a balanced relationship in this respect can we come into harmony with our world and be at peace.

Again the attempt to deal with the problem of scarcity in conventional economic terms is envisaged in a merely objective fashion. In other words economic meaning (or satisfaction) is defined in terms of total utility. And total utility can then be increased through making more resources available. So once more from the conventional economics standpoint, meaning is directly related to the provision of more goods and services.

However when we look at the same realities from a truly spiritual perspective, an opposite picture emerges. Remember that Economics starts from the assumption that wants are unlimited and resources limited (i.e. scarce)! However through authentic spiritual development, any attachment to material goods (in themselves) is greatly eroded. Therefore far from needing more and more resources for satisfaction, one can happily desire much less. Thus in traditional contemplative communities monks often live with remarkably few material needs and then liberated from want are able to enjoy life with a much greater freedom of Spirit.

So interestingly here we get a complete inversion of the (conventional) economics assumption, where now human wants (in economic terms) are limited and the ability of nature to provide these needs (in full freedom of Spirit) is truly unlimited. So here nature is seen in terms of abundance (rather than scarcity). In other words with the (extreme) spiritual perspective the initial (materialist) assumptions of conventional economics are completely reversed. For the material economist exterior natural resources are limited and human (interior) wants unlimited. Therefore because of this fixed starting point with respect to wants, the economic adjustment in reducing scarcity is always seen in exterior (objective) terms through the provision of more material resources.

However for the (purely) contemplative spiritual person - because economic wants are so few - the resources of nature are potentially unlimited and can be enjoyed with freedom of spirit. The economic adjustment here (with respect to scarcity) relates to the ability to do without in an ever-greater willingness to adjust to whatever (exterior) economic circumstances pertain. So the limiting factor for the spiritual economist is the psychological willingness to adjust to whatever prevailing (exterior) economic conditions may prevail.

It is fascinating how notions of value substantially differ from both perspectives. From the (conventional) economic perspective, goods only derive value from their scarcity (in relation to demand). So by definition a free good such as tap water that is substantially provided by nature has little or no economic value. Thus economic value is defined in terms of individual possession (to the exclusion of other people) of scarce goods and services.

However from the contemplative spiritual perspective value is directly associated with "free" goods i.e. the provisions of nature that are enjoyed with full freedom of Spirit. The very essence of this type of spiritual value is that it is not primarily based on possessive ownership and is thereby non-exclusive. A contemplative can of course recognise the relative secondary economic values associated with the activity of the market place. However, even when using such markets, goods and services in a primary sense remain "free" in that their actual enjoyment comes from freedom of Spirit i.e. through the quality of spiritual interaction one has with these goods.

When, from a properly balanced perspective both the material and spiritual dimensions are incorporated with each other, we obtain a radically new perspective on economic activity.

Here both economic (material) and contemplative (spiritual) notions of value are incorporated in a harmonious manner. So the emphasis now is on moderate material economic wants that are incorporated within an authentic spiritual perspective on life.

From this viewpoint the economic problem can indeed be satisfied in that a harmonious sufficiency can be reached where - freed from excessive material wants - moderate needs emerge which can be realistically attained.

From this dynamic interactive perspective the solution to the economic problem when it arises can always be approached from two directions.

From one perspective (i.e. the traditional economics perspective) one would attempt to make more resources available. For example in Africa where desperate human conditions prevail in many countries, the solution to the economic problem would clearly have to focus on this dimension.

However one could equally argue that in many affluent Western countries many people now enjoy more than sufficient resources and that it is the unbalanced materialistic conception of life that makes them seek for more. Therefore the economic problem here could be better solved not so much through seeking to produce more but rather from the interior side of adjustment i.e. in developing a more spiritual approach to life so that material needs would be substantially moderated. And of course these two are related. For the ability to recognize and help the plight of poorer countries requires that richer nations obtain a more realistic perspective on their own legitimate needs.

So to sum up, the starting point for an integral appreciation of economics is the balanced recognition of both spiritual and material motivation which are inevitably combined in every economic decision. Thus from an economics perspective we can no longer attempt to separate the material from the spiritual dimension of life (as they are both inextricably linked in experience).

The Individual and Social Dimensions

The second of the fundamental poles relates to the relationships as between the individual (part) and (collective) whole aspects of a relationship. As we have seen from a conventional scientific perspective, considerable reductionism in this relationship takes place with the whole effectively reduced to the sum of its (component) parts and in reverse fashion the parts reduced to the whole (as unambiguous fractions of the overall whole).

Now given its scientific aspirations, not surprisingly this reductionism is very prevalent in the conventional economics approach.

Free market thinking is based on the assumption that society is made up of individuals who can make rational independent decisions to maximize their own welfare. For the isolated rational consumer this entails the maximization of utility. For the individual producer rational behaviour entails the maximization of profits. Thus rational decision-making, according to such understanding, takes place independent of social considerations. Indeed the great benefit of the free market, according to Adam Smith, is that the overall collective good is obtained through such self-centered behaviour.

"It is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their own interest." [11]

However while recognizing the great role of markets in rationing scarce resources, clearly the collective notion of economic society as made up merely of individuals acting in a self-oriented rational fashion is extremely reduced and ultimately untenable. Human beings are clearly motivated by other than rational motives. Very often affective behaviour is more evident e.g. as regards impulse buying, the effects of advertising and the desire for social status through impressing others with "conspicuous consumption". Also more spiritual altruistic motives can lie behind economic decisions especially when exercised in a family or a close-knit community group. So right-wing economists who are greatly supportive of the free market, firmly believe in the benefit of sound family values (that require a cooperative social context). However they also espouse a free market understanding that is based on individual self-interest. So there is a clear conflict here with free market principles in the long run likely to undermine many of the more cooperative social virtues necessary for the "free market" to function properly in the first place.

Likewise the reduced notion of society - that is seen as the sum of its individual elements - leads to a merely quantitative measurement of meaning (largely devoid of qualitative considerations).

As we have seen the very logic of economic assumptions on utility lead to the conclusion that individual achievement will tend to be measured (in quantitative terms) relative to the performance of others in society. So the customary measure of success in a materialistic society is through one's relative wealth and earning power.

Therefore competitive society in dynamic terms is associated with the paradoxical result that those who are successful in terms of its philosophy thereby achieve substantial power to subvert its very workings.

This can clearly be seen form both producer and consumer aspects. The model of the free market is based on the ideal of - what economists refer to as - perfect competition requiring a large number of producers where no one has the power to unduly influence the overall outcome. However the reality of the market economy is somewhat different where for example giant firms dominate many industries and can also influence governments both nationally and internationally. So often the reality of international capitalism is not perfect competition but rather the growing dominance of giant multinational corporations that wield enormous power in the economic and political market place.

Likewise the ideal of the free market requires perfect competition among consumers where again no one consumer (or group of consumers) wields undue influence. However the reality is clearly different with enormous gaps in income often dividing the richer from the poorer members of society. Modern democracy is based on the notion of one person, one vote. However in the market place votes are measured by spending power so that those with more money can exercise a level of power through their economic votes that is entirely out of keeping with democratic principles. This lack of economic democracy also applies in the international market place. Here the poorer nations - who exercise so few votes - can become effectively disenfranchised in terms of prevailing economic activity. This is then further compounded by the fact that the rich nations use their power to artificially control those markets where competition might threaten to undermine national self-interest. Thus from a free trade perspective, the law of comparative advantage should play a major role in deciding the allocation of production resources. What this means in effect is that countries should concentrate on producing in those areas where they enjoy a relative efficiency advantage. In practice this would mean that the richer should be content - where possible - to leave agricultural production to poorer nations. However because of powerful farming lobbies in the developed world this has not happened so that we still have a considerable amount of artificial protective measures governing worldwide agriculture. Not alone therefore have the richer nations been flouting the principle of comparative advantage in a wholesale manner for decades but in areas like the EU they have been considerably overproducing, thus requiring the dumping of surplus agricultural production on world markets (thereby greatly depressing prices). Only recently has agricultural reform been included in the ongoing international trade talks. However one could be cynical and see this - not as generosity on the part of the developed nations but rather - as a reflection of the fact that due to a significant reduction in their farming numbers, the sector is no longer in need of the same protection.

Thus a considerably amount of hypocrisy necessarily informs political life (nationally and internationally) where though the pretence of equality justice and liberty for all is frequently preached, in reality its very mode of operation is largely geared to protect the interests of the powerful.

As we have seen the overall measurement of economic welfare is conventionally through GDP, which is the quantitative aggregate money measurement of all the individual contributions. However it is extremely defective in many ways. It cannot adequately reflect "externalities" (i.e. the wider collective effects of individual economic decisions). Also there can be significant diseconomies associated with growth. For example if car sales increase then economic growth will be enhanced. However this could well lead to negative externalities not counted i.e. traffic congestion. Then the attempt to reduce this through new motorways will further increase national income. So a significant amount of the increase in national income can be spurious due to the alleviation of "external" problems brought about by growth in the first place.

However by far the biggest deficiency of this approach to welfare is that it greatly ignores the qualitative dimension. Basically the untenable assumption is made that the best approach in society is to allow individuals pursue their own economic welfare (based on maximizing individual utility). This is made without specific reference to the common good and yet - amazingly - it is believed that the economic welfare of overall society can be best enhanced in this manner. This reduced notion of the relationship of the individual to society (and society to the individual) however is quite untenable from any genuine integral perspective.

Unfortunately a reverse form of reductionism tended to apply in practice in many of the socialist type systems loosely based on Marxian principles.

Note that when reduced principles apply we tend to combine opposite aspects. So the free enterprise model is based in (interior) psychological terms on individual assumptions with respect to (qualitative) human behaviour. Associated with this is the view that the overall economic society is thereby enhanced collectively in quantitative terms (i.e. through maximizing GDP).

However the extreme socialist model is based on opposite assumptions. Here in qualitative terms the emphasis is on the collective good of society (through notions such as equality). However the (quantitative) economic lot of the individual in this type of approach is determined in a largely impersonal manner (with freedom of action greatly curtailed). However because both models ignore the essential dynamic interaction of the individual and social aspects of economic life (in both quantitative and qualitative terms) both are thereby defective from an integral perspective.

Micro and Macro

Another interesting example of the reductionism of the (collective) whole aspect with the (individual) part aspect relates to the treatment of micro and macro economic activity.

Early understanding of the free market system was heavily based on emphasis on individual economic units. So consumption started with the individual consumer (or household). Production started with the individual producer i.e. the firm. Then considerable attention was given to the workings of an individual market. So Economics was largely synonymous with Microeconomics through concentration on the individual components that made up the economic system.

It was then assumed that given sufficient attention to ensuring the overall efficiency of these microeconomic components that there would be little need for concern regarding the workings of the overall (macro) economy. In other words the macro economy was treated in reduced terms as the aggregate sum of its component parts.

However a persistent problem affected the major developing economies during the 19th and early 20th century. This was known as the business cycle where overall economic performance was subject to a considerable amount of instability. During the good times a boom would unfold generally associated with a rise in growth, employment and investment. However after some years this would invariably plateau with the economy gradually turning in the opposite direction. Investment would then fall off, unemployment rise with the situation eventually reaching a severe slump before recovery would take place. Now free market economists had no real explanation for the business cycle and insisted in viewing it from a micro perspective (reflecting failings in individual markets). However in the 1930's the Great Depression was so severe - with conventional prescriptions only serving to worsen the situation - that new thinking was required. Then largely due to J.M. Keynes this led to an important macro dimension in Economics. So Keynes argued that the traditional micro approach - due its preoccupation with individual markets - could not guarantee the sound working of the overall macro economy. Therefore government intervention (through adjustment in its own spending) was necessary to stabilise activity at a high level. This led for many decades to emphasis on the dynamic role of fiscal policy as a way of achieving continual stable growth. This new role also led to a rapid increase in many countries in the overall level of government spending thus paving the way for the "mixed" economy and the emergence of the modern welfare state. So in one way it could be said that the capitalist system has proved itself capable of adaptation combining a new social role with successful economic performance.

However when looked at more closely, deep problems are still evident.

Though the Keynesian approach did provide for many years a successful solution to the business cycle, it did not challenge the fundamental principles on which the free enterprise system was built. Keynesian proposals - though very valuable in achieving economic stability as quantitatively measured - were based on pragmatic spending considerations rather than any deep social rationale.

Thus an uneasy compromise exists today in many Western countries as between individual and social priorities, which lack any real integral dimension.

So the private sector is based largely on principles of self-enrichment, with the state then intervening to address some of the social imbalances thereby created.

However in a society where economic efficiency can be achieved in ever more impersonal ways through the implementation of information technology, human care is becoming an ever-scarcer commodity. Whereas in previous times care and compassion would have been provided on a voluntary "free" basis, in a materialistic society it becomes a scarce resource which must increasingly be made available on a paid basis e.g. through state social services. However in a technological society, this becomes ever more costly to provide. Also with most governments now anxious to curtail expenditure so as to enhance the competitiveness of their market economies, increasing limits are being placed on its willingness to provide such "caring" services.

So for example in many Western countries, the health sector, that is largely state run, is coming under considerable pressure. And this can only get worse with the expected increase in life expectancy. So we have a critical conflict developing in society. (Impersonal) technological advances can keep people alive longer. However due to the growing scarcity of (personal) caring services, older people are likely - with present attitudes - to constitute an increasing burden on society.

As we have seen the first Industrial Revolution was associated with rapid changes in economies leading to considerable social problems and a great deal of human misery.

We are now entering on a new Information Revolution, which is associated with corresponding rapid changes and the emergence of new types of social problems.

Though we are indeed materially much "better-off", the present crisis is more directly qualitative in nature, relating to what I would see as a great lack of genuine care and compassion in society.

In other words because of persistent reduced emphasis on the merely quantifiable features of economic life, the vitally important qualitative aspect that is necessary to properly oil this "economic machine" has become greatly depleted. In a spiritually motivated society care and compassion would be provided largely as "free" services. However in materialistic society they become increasingly scarce qualities, which then must be provided through "paid" activity determined ultimately by market forces. And we are reaching the stage where the provision of genuine care is becoming so expensive that it is being gradually rationed out of the system. [12]

So if we are to properly integrate individual and social concerns, both the material and spiritual aspects must be combined with respect to the consideration of all economic activity.

Once again true spiritual enjoyment of goods requires the ability to negate (undue) selfish attachment with respect to them. Therefore the very means by which one moves from an individual to social appreciation of economic relationships requires this spiritual capacity.

So here the direct material positing attachment to goods relates to individual utility the corresponding spiritual attitude (whereby we can become detached from ego attachment to them) corresponds to wider social utility. In other words through such a spiritual attitude we learn to balance our own individual needs with the greater good of society.

Therefore in dynamic terms in an integral approach to economic well being, there is necessarily a continual dialectic as between material and spiritual aspects so that we can thereby achieve better harmony as between individual and social meaning. And of course in this context, where appropriate emphasis is given to both the material and spiritual dimensions, both quantitative and qualitative aspects of economic welfare can be properly incorporated.

In other words using the notion of utility we must realize that there are really two distinct types that are in dynamic interaction with each other. Thus material utility - which is what alone conventional Economic recognizes - comes from the positing of attachment in material terms to goods and services. However spiritual utility - comes from the more refined ability to negate selfish attachment (from an enlightened collective perspective).

Therefore though material utility is associated with the possession of more goods, spiritual utility can - in appropriate circumstances - be associated with the desire for fewer goods. Once again in an integral perspective both of these aspects must be both recognized and fostered.

Economics and Values

Perhaps the most serious of all deficiencies with conventional economic thinking is the manner in which it attempts to divorce economic behaviour from moral values. This in fact relates most directly to the relationship as between the 3rd set of polarities i.e. form and emptiness. In other words when the emphasis is on the material as form, the focus is thereby taken away from (spiritual) values as emptiness.

Economists try to make an untenable distinction as between positive and normative statements. From the conventional perspective, Positive Economics adopts a supposedly objective value free stance to economic matters as befits a scientific type approach. Normative economics then incorporates value judgements where policies to implement economic decisions are considered. From this perspective Economics - as taught in the majority of Western institutions - is synonymous with Positive Economics. So economists - speaking as economists - are supposedly able to discuss economic issues in a value free fashion.

Normative economics is then identified with Politics where important value decisions in the implementation of policy must be taken. In the earlier days - before Economics became so differentiated from other activity in scientific terms - Politics and Economics were considered as interdependent. Indeed for nearly 100 years after Adam Smith, this interdependence was largely maintained with Economics known as Political Economy. Though Political Economy is still taught in some institutions the study of Economics (i.e. Positive Economics) is far more prevalent where it is given a particularly narrow focus as if somehow synonymous with the free enterprise market system. However far from being value free, "Positive Economics" through its reluctance to deal with deeper philosophical issues, acts as an uncritical apologist for the free market system. In this sense Economics as taught in Western Universities is directly supportive of the free market as a political ideology.

Of course from a dynamic experiential perspective - and economic activity is necessarily experiential - there is no such thing as Positive Economics. Indeed the very supposition that economic issues can be studied free from "value interference", in itself represents a very important value i.e. the deliberate attempt to screen out the value implications of economic thinking. What one denies at a conscious level will then inevitably intrude into one's understanding in unconscious terms deeply affecting one's characteristic attitudes to every economic event. Unfortunately however this fact will not be properly recognized so what one might consider as "objective" thinking, will appear to another as deeply biased understanding.

Those who are most supportive of the Positive Economics would be frequently be identified in political terms as distinctly right wing in their characteristic mode of looking at issues. In other words they start from the supposition that free markets are "best" which then deeply colours the "objective" manner in which they analyse every economic issue.

Unconscious bias therefore governs everything, the choice of economic issues that are considered relevant for study - for example free market advocates are unlikely to put the distribution of income at the top of their agenda - the manner in which issues are studied, interpretation of research findings - again one tends to unconsciously screen out those findings that do not suit one's own prejudices - and finally the overall manner in which conclusions are reached.

So the view that there is such a thing as Positive Economics is in fact a great fiction, which however is used - perhaps unconsciously - to serve an important end i.e. uncritical acceptance of a particular ideological view of how the system works.

I am not suggesting of course that there is no role for the objective study of Economics where we try to deal with issues in a relatively independent manner. However the proper context for such study can only come from an overall dynamic understanding that is interactive and normative.

In other words every economic decision that is taken is necessarily a moral one.

So as a consumer, every decision I make has moral consequences. Some of these may be minor e.g. a decision to buy a newspaper. However others such as large speculative investment in property or shares may have important consequences. Then a decision for example by a married man to spend a good deal of money drinking may have serious moral implications with considerable implications for himself and his family. Thus consumer decisions are never taken in (individual) isolation. And of course an overall lifestyle that is oriented to consumer spending can deeply affect commitment to a more authentic spiritual life.

So if a nation in fulfilling extravagant material desires thereby ignores the plight of much poorer nations abroad and also the plight of the less fortunate within its own midst, then this constitutes a moral issue of the first magnitude. And the moral dimension of this situation is ultimately inseparable from the individual decisions that are taken with respect to various consumer markets.

Likewise from the producer side any decisions taken by firms e.g. regarding employment or investment decisions are primarily of a moral nature (when properly understood from an integral perspective). Therefore when seen in this light the very attempt to view such decisions in a "value free" fashion is in fact immoral. Thus the conventional economics approach to market behaviour - which seeks to understand its workings in a merely objective impersonal fashion - is strictly immoral from an integral standpoint. I realise that many may find this hard to accept but this only goes to show how deeply ingrained is the conventional - and ultimately - untenable interpretation of markets.

The market ideology is built on the notion of "objective" forces - operating with minimum interference - as the best solution for dealing with the economic problems of society.

However the truth is that market behaviour necessarily entails a continual dynamic interaction as between subjective motives and objective events. Likewise market behaviour represents a continual dynamic interaction as between individual and social notions of identity. And most importantly when seen in this context, market behaviour represents the exercise of value judgments reflecting the means though which an appropriate harmonious balance is maintained as between both the interior and exterior (and individual and collective aspects).

Now of course when one attempts to interpret market behaviour in a greatly reduced fashion (as with conventional economics) there is a considerable abnegation of the moral dimension of economic decisions. In other words (spiritual) values are significantly reduced to material (phenomena) in the merely quantitative interpretation of economic events.

For example the global financial markets are extremely important with vast sums of money traded (often in a very speculative fashion). Now the external objective behavioural aspects of the market reflect the subjective motives and aspirations of the many individuals and institutions taking these decisions. And all of this has deep moral implications reflecting the appropriateness of the relationship as between both aspects in the market place. Share price values in a market could be rising rapidly (as objectively observed). However we cannot abstract this event from the subjective behaviour of those taking the decisions with respect to transactions in the market. In other words such behaviour may well reflect the unprincipled desire of many to make "quick" profits through speculative activity. So the overall dynamic behaviour of the market (representing the interaction of both the subjective decisions and objective events) is guided by moral attitudes that are central to determining the overall nature of market behaviour involved.

Now unfortunately, when we insist on interpreting markets (with respect to their merely objective quantitative characteristics) the interior subjective aspect is significantly reduced to the objective aspects. In other words the behaviour in the markets is not qualitatively identified with the subjective wishes of the participants but rather with its objective manifestations e.g. rising share values.

And while no real attention is given to the qualitative subjective side, even less attention is given to the moral dimension (which reflects the appropriateness of the two aspects - objective and subjective - in terms of each other).

Not surprisingly from an integral perspective the behaviour of markets can be - quite frankly - often immoral (even when legally permissible).

Indeed I find it fascinating to observe the manner in which financial markets are personified (despite the so-called impersonal forces operating in such markets).

So we hear of markets being "jittery", "tense", "rallying strongly", "having a good day" as if somehow these characteristics can be abstracted from the individuals actually taking decisions. Meanwhile the participants are often referred to as "players" as if high finance is just a big game (without any real moral consequences). And of course these "players" would like us to keep thinking this way so that the issue of moral responsibility when analysing market behaviour be thereby avoided.


So to sum up, Integral Economics requires that the three fundamental polarities (that condition all development) be considered in a properly balanced dynamic interactive context.

This entails from a horizontal (heterarchical) perspective that the exterior (physical) and interior (psychological) aspects of all economic decisions be treated as dynamically interdependent. So therefore in experiential terms, interior attitudes influence exterior economic events; likewise exterior events influence interior attitudes. Now conventional treatment does not recognize this interactive dialectic concentrating on the merely quantitative physical aspects of economic behaviour (thereby significantly reducing the interior to the exterior aspect).

Again in integral terms, from a vertical (hierarchical) perspective, the individual (personal) and collective (social) aspects of economic behaviour are again treated as dynamically interdependent. Therefore in experiential terms, individual is interdependent with overall social behaviour; social behaviour is likewise interdependent with individual behaviour. The balanced interaction of both is required to preserve both the quantitative and qualitative aspects of economic behaviour. Again the conventional treatment is very inadequate. In the free market system the social dimension is significantly reduced to the individual i.e. where economic society is viewed as a fragmented collection of individuals. So society thereby lacks any true whole dimension. In socialist systems the individual is often reduced to the collective. This leads to a merely composite notion of society (that is greatly lacking in individual uniqueness).

Finally from a diagonal (hierarchical and heterarchical) perspective, the material (form) and spiritual (empty) aspects of economic behaviour are again treated as interdependent. This leads to a primary emphasis on the importance of authentic values as the means through which both the material and spiritual aspects be harmoniously balanced.

Also this attempt to balance the material and spiritual, serves as a prerequisite for the related task of balancing interior and exterior aspects (heterarchically) and individual and social aspect (hierarchically).

Perhaps the greatest lack with present economics is the manner in which the spiritual aspect is greatly reduced to the material with the corresponding attempt to understand economics in "value-free" fashion (thereby identifying it with the mere physical workings of the market system).


1. I would not fully accept the Marxian view that economic forces substantially determine the other forces in society. Economic forces are ultimately rooted in the relationship between both the material and spiritual aspects of life, which are interdependent. Thus though it may often appear true that economic modes of production seem to determine the other modes this is not necessarily the case. Human beings can if they really desire exercise a greater degree of freedom therefore challenging any deterministic explanation. In the end the great weakness of Marx's position is the lack of a genuine transcendent spiritual dimension.

2. In the most general way the central problems of every economic society are summed up under "what, how and for whom". "What" relates to the need to decide on what to produce. "How" relates to the methods of production to be used and "for whom" relates to the manner of distribution of resources. However from an integral perspective these issues cannot be understood in merely objective terms.

3. For example the doctrine of mercantilism was prevalent in Europe during the 16th 17th and 18th centuries and related to a view that a favourable balance of trade (i.e. surplus of exports over imports) was an appropriate means for building up a nation's wealth. However whereas this might make seem valid for one country in isolation, from an overall international perspective it makes little sense as one country's exports represents another country's imports. Thus the logic of mercantilism - when carried to its extremes - would be for a country to successfully export everything it produces (while importing nothing). Then the great accumulation of gold in the National Treasury that this would represent would be equally associated with the starvation of all its citizens.

4. There seems little doubt that Adam Smith was influenced by Newton's views and that he looked on the price mechanism as "the invisible hand" guiding the destiny of markets in the same way that Newton understood the role of gravity in maintaining the order of the planetary systems. So quite literally due to the "invisible hand" operating through the "price mechanism", markets have a natural tendency to gravitate towards equilibrium (where supply equals demand). Thus for Adam Smith the "price mechanism" constituted the "gravity" holding together the market system.

5. There are however fundamental problems with his analysis of value. Marx never sufficiently distinguished the role of enterprise from that of labour. Therefore his labour theory of value was not really tenable. Also he underestimated the capacity of the capitalist system to evolve into the "mixed" economy where it could adopt a much more prominent welfare function.

6. We could perhaps include John Maynard Keynes "The General Theory of Employment Interest and Money" (1936) - which paved the way for a new macro emphasis in the market system as - almost - equally influential.

7. Though Keynesian Economics did indeed represent a very significant practical modification in the working of the market system it did not really challenge the underlying philosophy on which this system was based. In theoretical terms, Keynesianism was subsequently reabsorbed with the old free market thinking in a new neoclassical synthesis. Also through growth in public expenditure brought about by Keynes' ideas, incentives in the market were gradually stifled through rising taxation. So there has been a significant movement away from Keynesian ideas in recent years with his particular policy prescriptions largely seen as a historically determined special case scenario.

It must be admitted that conventional economics is very attractive for another reason in that its somewhat fixed assumptions lends itself to mathematical type analysis. So a disproportionate number of mathematicians have found their way into the economics field, thus adding to its pseudo scientific appeal. However the desire of such mathematical economists to make a mark adds greatly to the distorted profile of present economics (that is dependent on maintaining unrealistic fixed assumptions of behaviour). So we have countless economic journals devoted to arcane mathematical type analysis e.g. of "steady state" systems that are of little of no practical benefit to anyone. I would readily admit of course the great benefits of mathematical skills at the empirical level e.g. in the design of econometric models with the ability to test the implications of changes with respect to various economic variables on overall growth. However the employment of mathematical skills at the theoretical level, I would see as somewhat less relevant.

Analytic mathematical skills would be of little use in the integral holistic approach to Economics. However holistic mathematical understanding would be of great potential benefit (though unfortunately few have yet any real insight into its true nature).

8. Though there are certain similarities as between my use of heterarchical and hierarchical polarities and Ken Wilber's use of quadrants, because his approach is not inherently interactive, there remains a deep inconsistency as between his handling of quadrants as understood in a differentiated manner (where they are treated as separate) and their corresponding understanding from an integral perspective (where they are treated as interdependent).

So for example the reductionist tendency of science is somewhat subtler than Ken would have us believe. Science can be given both Right-Hand (i.e. as object phenomena) and Left-Hand interpretations (as mental phenomena). Therefore we can reduce the Left-Hand to the Right-Hand as when we identify mental constructs with object phenomena (as in the empirical approach) or reduce Right-Hand to Left-Hand as when we identify object phenomena with mental constructs (as in the theoretical approach) Thus a double form of correspondence - and reductionism - is involved.

9. Of course form can likewise be reduced to emptiness. Indeed this is very common - especially in interpretation of the "higher" stages of development where formal structures are identified with empty states.

10. Economists attempt to distinguish as between cardinal utility (where it is directly measured on a quantitative scale) and ordinal utility where one is enabled to make relative ranking comparisons as between different sets of utility (e.g. whether one is getting more or less satisfaction or perhaps the same degree of satisfaction from two sets of goods. However the ability to accurately make such comparisons implicitly requires that we can measure utility.

11. Milton Friedman has argued that self-interest does not necessarily mean selfish interest. However if we are to maintain this position then it requires explaining how an individual moves to a more enlightened notion of self-interest. Enlightened self interest clearly presupposes however a social dimension to behaviour, which is not consistent with assumptions based on mere individual self-interest. So free market advocates such as Milton Friedman can offer no credible explanation of this social dimension.

12. I can see many ways in which this is happening. For example I must admit to a personal aversion to answering machines - not because they cannot be very useful in appropriate circumstances - but because I find communication with pre-recorded (or synthesised) voices so impersonal. However the efficiency of organisations (as conventionally understood) is likely to dictate that human beings be increasingly displaced from such a communication role.

The financial institutions in Ireland as elsewhere - in the interests of cost savings - are anxious to significantly reduce the number of branches and "migrate" people to the Internet to do their banking services. However again though, this service in appropriate circumstances is indeed be very useful, it can also be associated with a further reduction in personal contact (especially in more remote areas). The very use of the term "migration" is very interesting. Indeed migration - or more precisely emigration - was a very important issue in the past in Ireland with many areas becoming significantly depopulated. However this new type of "migration" could be even more significant on a worldwide basis in that it envisages a rapid move by people inhabiting the "real" world of economic space to the "imaginary" world of cyber space (which has enormous potential social consequences).

Once again the digital revolution that makes cyber space a new (virtual) reality is based on a simple analytic manner of processing information. Ultimately as I see it, a holistic digital revolution based on the equal recognition of both linear (differentiated) and circular (integral) modes of understanding will be required as a means of social transformation thus enabling us to successfully incorporate these technological developments into our lives.

On the issue of "care" there was an interesting case of our national airline refusing to fly home the bodies of deceased relatives (who had died abroad) for burial due to a cost cutting measure with respect to the handling of "cargo". In fairness this decision was subsequently reversed after a strong public protest. However it does illustrate how "efficiency" measures in competitive industries can lead to a reduction in "social care" through the neglect of important human considerations.


Michael Barratt Brown: Models in Political Economy: A Guide to the Arguments, Penguin 1984

E. F. Schumacher: Small is Beautiful: Economics as if People Mattered, Perennial, 1989

Adam Smith: The Wealth of Nations, Bantam Classics, Cla Edition (2003)

Karl Marx: Economic and Philosophical Manuscripts of 1844, International Publishers 1980

Milton Friedman & Rose Friedman: Free to Choose, Harcourt (reprint Ed 1990)

John Kenneth Galbraith: The Affluent Society, Mariner Books (40th Anniversary Edition, 1998)

Hawken, Paul, Amory Lovins & L. Hunter Lovins. Natural Capitalism: Creating the Next Industrial Revolution, Boston, Little, Brown & Co. 1999

Ray Harris, Thoughts Towards an Integral Political Economy, June 2004

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