Economy and Church, why does church (Catholic) is a very well designed and adapted model of economic efficiency

Since centuries, churches have played a powerful role in the world. It was basically the center of everything, from philosophy, belief to science. Church had been responsible for a lot of advancement in scientific fields and so one. But for those realizations, they needed money, and efficiency in usage of those financial and physical resources. Basically, the Church is not a financial activity with the aim to make money, so it should be difficult for the church to involve financially in contributing themselves to fund their activities. So a lot of strategies was required in order to bring this money. This is where the model of efficiency comes into the game to take care of church activities.

How does church mobilize resources to manage their activities?

Depending on the timeframe, we can observe different models of resources mobilization in churches specifically catholic churches. The evolution of Catholicism had travelled lot of period and conjectures. At a time it was one of the most powerful institutions in a community, then a region, a continent and finally the world. So depending on those conjecture, the Catholic Church had an evolution adapted to the moment. In the past churches ask for taxes from citizens. It was frequently asked to pay a fee for contributing to the religious war, in order to defend the king, the kingdom and the clergy. At some point, the clergy was so powerful that they even had the power of life or death on individuals. There is not our objective, was the most important for us is to track where does those resources come from, to build those magnificent buildings and cathedrals, like: “Notre Dame” de Paris, “Notre Dame” d’Amiens, The Cologne Cathedral, “the Sixtine Chapel”, “The Basilique St-Pierre” in Roma etc… Even further in the past, before Christ, Jewish Churches usually required taxes from believers and Jewish people to get purified from their sins. Most of the taxes called “Dime” were used in the construction of churches, take care of some responsibilities and so one. In present-day Catholic is still financially powerful, in Rome specifically where the Pope is living is an independent and very rich place. Right now Catholic Roman Church still has a lot of funds for their activities, but remember that usually popes and other personalities from the clergy had usually made a vow to poverty, so most of that money is from donation as pope, cardinals and so one doesn’t work and don’t have a salary. It is reported from the “Quora” website that: “The pope does have access to hundreds of millions of dollars each year, which are intended for charitable use and Church activities” (www.quora.com). Despite the fact that some of them make poverty vow most of them go to universities and learn a lot of science in order to become expert in some domains and by this occasion become good at managing some aspect of the Church community and activities where Church get involved for the community or the world. Those funds are from people who believe in the religion, from people who believe in their power of well-doing, and also salaries that some of them can’t take because of their vow. By the way, their management is so efficient that in some countries they possess the best academic institutions: Schools (Primary and High school), Universities (Colleges and universities), libraries, laboratories for researches, Hospitals.

How does it show the similarity with the most efficient economic models?

It’s a little bit over exaggerating by saying that the showcase similarities with the most efficient economic models as we may know the definition of economy efficient. According to investopedia.com: “economic efficiency, implies an economic state in which every resource is optimally allocated to serve each individual or entity in the best way while minimizing waste and inefficiency”. Furthermore, they add: “when an economy is economically efficient, any changes made to assist one entity would harm another”, in some case this could be called “Pareto efficiency”.  As some other may know it exists multiple types of efficiency but basically they tend to pay attention to five of them which are: allocative, productive, dynamic, social and X-efficiency. In this case, we’ll say that this efficiency of the Catholic Church could be social as in most cases it requires some form of taxation, specifically in the past as the Catholic Church took taxes. Generally what is impressive is how well the Catholic Church uses its money and how effective they are in achieving their goals. But anyway in our analysis we don’t consider church typically as a market with producers and consumers. That’s why our opinion could differ somewhere from typical economist analysis, we preferably try to analyze this efficiency in function of inputs utilization and output registered as results of the use of inputs by the church community. In some way, we can consider some church involvement in society as allocative efficient, specifically when taking the case of schooling or education, where the optimal outcome would be achieved when the marginal cost would equal marginal benefit. In educative investment, we’ll say that benefit won’t be financial but would instead equal to realizations in the system, for example how many kids or students will complete the “learning cycle” from their schools and universities. As we might know, the level of education offered by Catholic schools required a lot of funds. As most of the time best schools are managed by Catholic communities. So, some of those high fees are required to achieve higher results.

What can we learn from catholic management?

As we might say it before, Catholic has shown the most of effectiveness and efficiency in their management. Their results are the fruits of the mobilization of a lot of virtues. One of them is rigor in their principles. This rigor attracts a lot of trust from individuals and financial support, but where rigor is the most influential is in the achievement of results, they usually stick to their plan. It isn’t usually easy to manage if there’s no plan well designed and adopted, but it is more difficult if we have this plan and don’t stick to it or don’t follow religiously this plan. Secondly, we’ll say that results require a lot of sacrifices, most clergy personalities are most of the time willingly ready to sacrifice their well-being to be useful to their society and achieving the clergy goals. Most of the fruitful economies are those where individuals are willing to make sacrifices. We can also learn that their funding methods are working they should teach the government how taxes might be used to have the best results possible for their population. Mostly it is hard to find examples of corruption like financial corruption in the church. It might exist but I don’t really have any in mind. They might also use human resources in their right places, some clergy member such as priest, clergyman, father, preacher, abbé, etc… are involved in education, some others in health care, some in management, in construction and so one. And finally the last and the most important it’s the law that they should follow and their respect for those laws are what keep this community alive. That doesn’t mean that they are perfect, but our goal was only to analyze how did they realize their economic results and how can we imitate their best behavior to improve our societies.

How it can influence the national economy?

Their contributions are socially impacting for some nations. Their funds are sometimes important in reducing poverty and enhance and increase services offered to those who are not privileged enough.

Did their management help international advancement?

Their activities show us one of the best applications of the concept of “Globalization” as a lot of Catholic communities work remotely and are well established in a lot of countries around the world. Financial involvements are useful in reducing inequality in some places. Their medical involvements also help those who can’t afford those services the opportunity to get them. They also encourage some members to continue their studies in order to get better, for example, “Jesuits” are one of the communities with the concentration of a high number of smart individuals. In the past, they had financially contributed to some scientific researches and experiment for inventions and discoveries. A lot of young people were inspired by their work and decided to join their community, this community also offers a lot of opportunity to individuals to become intellectually a better person. Their schools helped a lot of individuals in achieving their goals by accessing to the best level of education in primary, high school, and higher education.

 How did they affect the international economy?

Nowadays catholic society has its own independent state in Roma, which is not only independent by management but also politically and economically independent. So as an independent state they might offer a donation to other nations. They might have diplomatic relations with countries around the world, where they can have relations based on trade with nations. They might import goods and services which can help some nations to be beneficiary of their commercial relationships. As an independent nation or state, it can support financially and politically other nations. But I think they might have limited involvement in politics. They are also involved in the international market, and international companies might benefit from their relations, for example, car companies’ airways companies as clergy members usually fly, from Roma to other countries or from other countries to Roma, at a highly frequent level. I think their commercial balance might show a deficit, but this deficit is a kind of balance of donations and taxes( If they still take them).

Widley Marcelin