part0007

What is economic theology? Above all, it is something very different from what one might first guess, such as a theological ethic of economic action, which of course is not new, but a discipline deeply anchored in the traditions of theological thinking. Most religions have instituted ethical norms to guide the economic practices of their believers concerning, for example, the responsible handling of money and wealth, restrictions on charging interest, the giving of charity to the poor, and fairness and honesty in business transactions. A theological ethic is based on the religious distinction between a transcendent sphere and the profane world; it aims to transform revelation-based knowledge into practically relevant principles of moral conduct (for an overview, see Wilson 1997). Economic theology does not contradict the distinction of the transcendent and the profane. What it rejects, however, is the exclusive attribution of the economy to the profane world. To be precise, we are not talking about the economy in general, but of the economy of present-day global capitalism.

Global capitalism has emerged from a process which economic sociologists – following Karl Polanyi – characterise as a ‘disembedding’ of markets. ‘Disembedding’ refers to the expansion of markets across given territorial, institutional and social confines starting in the early nineteenth century and resulting in the historical formation of capitalism as a global system. As an encompassing social system, disembedded markets give rise to the very epistemological problem that is associated with any idea of society as a ‘totality’: in becoming total, markets cannot become an object to any observer, but are experienced as a ‘horizon’, framing actions and observations in an involuntary way and being accessible only from the perspective of a participant. While Carl Schmitt concentrates on the implications of politics becoming total, economic theology focuses on markets, which, by virtue of their disembeddedness, take on an encompassing character and cannot be known as a totality by anyone – and liberal economists (in particular Friedrich August von Hayek) have emphasised this point. As an encompassing social reality, markets and money (as their medium) possess enigmatic and even numinous qualities that traditionally have been attributed to religious experience. No longer is capitalism being interpreted as a system merely ‘influenced’ by religious traditions, as Max Weber (1978) did in his studies of the Protestant ethic. Rather, economic theology follows Walter Benjamin (1985), who in his famous fragment defined capitalism as a religion. This is a departure from conventional economic thought and its view of the economy as a profane reality governed by nothing but utilitarian rationalism and materialism. Economic science, in this view, has been confronted with a historically new world of contingencies, which, though being man-made, are reminiscent of religious transcendence due to their encompassing and existential character. To deal with these contingencies in practice, action patterns showing formal parallels with religious rituals have evolved. From such a viewpoint, it may become understandable why some authors, such as Alexander Rüstow (2001) and Robert Nelson (2001), have diagnosed a latent proximity between theology and economic theory.

How can such an unorthodox approach be justified? In the recent debate, three lines of discussion have developed. The first debate concerns the theological genealogy of the term ‘economy’ itself. Oikonomia in the original ancient Greek, as coined by Aristotle, can be translated as ‘management’ or ‘housekeeping’. The concept marked the domestic sphere of reproduction, to be distinguished from the public realm (the polis or city-state). As Giorgio Agamben (2011) has shown, the concept’s original profane meaning underwent a change in the course of its reception by Christian theologians. Paul and the Church Fathers in the first centuries CE used the concept of oikonomia in order to circumscribe the governance of mundane life by God. Christian teaching emphasised the idea of one God; it rejected the Gnostic dual world-view with its distinction between the superior being and an inferior creator God (the ‘demiurge’). The Trinitarian formula was introduced to settle the problem of how God as a transcendent being could nevertheless enter into mundane history and reign over the human world. Oikonomia now referred to the management of the world by God through his three-fold presence as father, son and Holy Spirit (Agamben 2001: 17–18.). At the same time, the Church followed the Aristotelian conception of the mundane economy as a big household being organised as a self-sufficient sub-unit of a hierarchically structured cosmos and as something that is not compatible with chrematistic practices of making more money with money. William of Auxerre (1160–1229) condemned interest as a sinful human intervention into the sovereignty of God over time; Thomas Aquinas (1225–1274) followed Aristotle in denouncing interest and usury as unnatural and evil. Despite the gradual rise of markets, commerce and banking during the Middle Ages, the condemnation of usury by the Church became even harsher. Only after the Reformation did the interpretation of divine providence change. It shifted from the perception of God as an omnipresent ruler to that of a legislator, leaving men the freedom to regulate their own affairs within the natural laws that he had instituted. As a consequence, the economy could no longer be conceptualised as an entity purposively organised by God; rather, it was interpreted – such as in the work of Thomas Hobbes and Bernard de Mandeville – as a ‘machine’ coordinated by natural laws. Still in the physiocratic school of the eighteenth century (most famously represented by Anne Robert Jacques Turgot and François Quesnay), economic governance was understood as the application of metaphysically based ‘laws of nature’ to human reproduction (Koslowski 1998: 32–33; Priddat 2013: 51–52). Gradually, however, the focus shifted from natural laws to human interests and to the modern idea of the economy as an order not instituted by God but as a phenomenon emerging spontaneously from free market forces.

And it this concept that leads us to the second debate, which has to do with open and hidden references to theology within modern economic theory. Adam Smith’s ‘invisible hand’, 2 that is, his concept of an emergent self-regulation of market transactions providing social welfare in an unintentional way, has remained a core piece of economic theory up to the present day. Different from later economic theorists, Smith never presented any rigorous theoretical explication of the concept, but confined himself to a variety of ad hoc illustrations. And the scientific character of Smith’s conception continues to be contested. 3 While most economists view Smith as the founder of modern, scientific economics, Lisa Hill (2001) made a strong point that such an interpretation cannot be upheld without reservations upon closer examination of Smith’s philosophical and theological background. Although he found little attractive in Christianity, Smith shared the deist belief in a benevolent divine ‘Providence’ that was widespread amongst the intellectuals of his time: ‘God exists, the world is the product of design, and the observable order of regularity in human affairs is a direct result of his design and purpose in nature’ (Hill 2001: 5). As Hill argues, these assumptions were basic to the argument set out in The Theory of Moral Sentiments (Smith 1991 [1759]) as well as in The Wealth of Nations (Smith 1999 [1776]). In this sense, Smith’s work is ‘manifestly theological’ (Hill 2001: 1). Smith conceptualised the economy as a two-tiered model, with the first tier representing the individual action level and the second tier representing the social system level designed by divine Providence. This distinction of levels allowed him to follow the Stoic justification of apparently vicious human desires and actions as indirectly beneficial. Even intentionally immoral individual actions can have positive consequences for society as a whole in a way that is transparent not to limited human reason, but only to the divine creator. In this sense, the old concept of oikonomia as divine governance of profane human affairs continues to be present in Smith’s apparently secular concept of the invisible hand (see also Viner 1972; Viner 1998: 37–38; Agamben 2011: 277–278; Priddat 2013; and Binswanger 2015).

Even if one concedes theological influences on Smith’s thinking, one could argue that this is irrelevant for modern economics, since there has been no lack of later attempts to establish equilibrium theory on a truly ‘scientific’ basis. The milestones here were, as it is well known, the general equilibrium models of Leon Walras (1954) and, much later, that of Kenneth Arrow and Gerard Debreu (Arrow and Debreu 1954). The ‘scientific’ reconstruction of the invisible hand here meant its mathematical explication as an overall constellation of goods and factor prices that would satisfy the condition of Pareto optimality. ‘General equilibrium’ referred to an ideal stage of the total system, in which no rational actor would have reasons to change their disposition; it was a model which was designed to serve as a tool with which to reconstruct the actual working of market forces. As many critics have noted, however, the mathematical demonstration of general equilibrium was possible only under extremely restrictive assumptions, assumptions that were far away from empirical evidence such as the perfect rationality of actors, perfect knowledge and competition, given and concave preferences, given technologies, constant returns of scale, the absence of external effects, and the neutrality of money. This meant eliminating the uncertainty of markets on the level of analytical premises and assuming everything away that could give rise to empirical doubts about the possibility of a general equilibrium being reached. General equilibrium analysis is empirically void, as Friedrich Hayek noted:

Hayek’s critique of neoclassical equilibrium theory is clear and concise. The intellectual provocation lies in the conclusions he draws from it. The most plausible conclusion would have been a concept of markets as a black box, a field of contingencies, where almost everything can happen. Price signals may induce a positive, welfare-enhancing feedback effect on individual actions, but likewise may produce contradictory impulses, 4 or may induce self-reinforcing disequilibria and bubbles, as is often the case in real estate and financial markets. Markets are an arena providing ample opportunities for actors to phish and cheat each other (Akerlof and Shiller 2015). Market transactions may produce negative externalities at the cost of third parties instead of enhancing the general welfare. Competition in the markets tends to undermine itself by reinforcing power asymmetries and giving rise to monopolies. Instead of such a black box concept, Hayek ends up with a euphemistic portrait of markets as spontaneous processes generating a higher level of human evolution. Since markets are able to process a level of complexity that surpasses anything individual human reason can grasp, there is no chance to assess the ‘rationality’ of price signals. Nevertheless, we have to accept them, as Hayek argues, not only as a matter of fact, but with ‘humility’, because they represent a ‘higher’ order of human affairs transcending the power of individual reasoning. ‘True’ individualism, in contrast to ‘false’ rationalist individualism, qualifies itself by its ‘consciousness of the limitations of the individual mind which induces an attitude of humility toward the impersonal and anonymous processes by which individuals help to create things greater than they know’ (Hayek 1948: 8). Hayek’s apology of free markets not only brushes away management and organisation as fundamental issues of economic practice and theory, but also appears to be self-contradictory: Hayek criticises individual reason in the name of an allegedly superior collective reason incorporated into the evolutionary process. However, how should the latter be accessible without recourse to the former? What Hayek is offering is not a scientific theory, but a eulogy for market-driven evolutionary progress, and its in-built superior reason, which not by chance is reminiscent of theological thought. Smith’s divine providence appears again, albeit not in an explicit theological language but in that of higher evolutionary ‘reason’ (for a discussion and critique of Hayek, see Kley 1992; Brodbeck 2001; Backhaus 2005; Vogl 2010; and Fleischmann 2010).

A further tradition of economic thinking, where theological heritage is also influential, albeit less in the sense of economic theology and more in the sense of conventional theological ethics, is the German school of ordoliberalism. This school, which had a strong programmatic influence on the reconstruction of the West German economy after 1949, constituted itself in Freiburg and Cologne in the 1920s and early 1930s; its leading members were Walter Eucken, Alexander Rüstow, Wilhelm Röpke, Franz Böhm and Alfred Müller-Armack (for an overview, see Koslowski 2000: 93–274). The term ‘ordoliberalism’ denotes precisely the difference between this school and the Anglo-Saxon liberal tradition of Adam Smith, David Ricardo and Jeremy Bentham: what is advocated here is not a ‘genuine’ liberalism, relying on the welfare-producing effects of spontaneous market forces, but a market economy that is embedded into a strong institutional and moral order. It was the common conviction of the ordoliberals that the traditional free market concept, which they termed derogatorily as ‘paleo-liberalism’, had become outdated due to the crises of the early twentieth century. Alexander Rüstow (2001) even warned of the belief in free markets becoming a ‘religion’ in a dangerous and fatal sense. This did not mean that the ordoliberals deemed religion to be irrelevant for the governance of markets. However, as they argued, the genuine locus of religion should not be the market process itself, but the institutional and normative order framing it. Such an institutional frame was considered vital to preventing the rise of monopolies and excessive social inequalities, to enforcing the rules of fair competition, and to securing the equality of social chances. It was not the market itself, but only a strong state that could contain excesses of self-interest and guarantee the smooth and beneficial working of the market mechanisms. The role of government was not confined to setting up general rules, a point that had been vital for Hayek. Discretionary interventions to regulate competition were considered legitimate to some degree too; Müller-Armack even advocated collective bargaining and social policy interventions to protect the market position of the poor, though there were profound disagreements on these issues within the circle of the ordoliberals (Hien and Joerges 2017). The state, in turn, could be strong and superior to particular interests only under the condition of founding its legitimacy not on secular, democratic values, but on higher, transcendent ones. As Philip Manow (2001) has shown, the theorists of ordoliberalism did not develop their position from a liberal background, but from a strong commitment to Protestant theology. Eucken, Böhm, Röpke and Müller-Armack were deeply concerned about the decay of Christian values in modern, secularised mass society, and their concept of a ‘social’ market economy was intended to set a counterpoint against this tendency (Holthaus 2015; concerning Röpke, see also Horn 2011). They did not see the state primarily as an institution of free citizens laying down the rules of the market, but as an agency of moral education, fighting not only market monopolies, but also greed, egoism and consumerism. The key responsibility of economic policy should not only lie in promoting wealth and economic efficiency, but in managing competition and individual motivation in a way that is conductive to superior moral values.

This interventionist conception of the state revealed profound differences between ordoliberalism and the Anglo-Saxon tradition of liberalism. For the Anglo-Saxon liberals, including Smith, Ricardo, John Stuart Mill, Bentham and Hayek, markets constituted the very core of a free and universal civil society, with the state performing only an instrumental role for citizens to regulate their proper affairs. For the ordoliberals, on the contrary, the state was an agency superior to markets. As an agency instituted by God to contain the sinful nature of man, the state, not markets, represented the true and ultimate nexus of society. Ordoliberalism, thus, is at odds with the universalistic impetus of Hayekian liberalism. What it offers instead is a national container model of the economy, which plays down the transnational scope of markets in contemporary capitalism.

A third debate where economic theology is present has evolved around the interpretation of modern capitalism as a ‘secularised’ form of Christian eschatology. One of the leading authors here is Robert Nelson with his interpretation of economics as a religion (Nelson 2001). Being educated as a professional economist and drawing largely on the historical work of Jacob Viner (1972, 1978), Nelson reviews the history of modern economic thought, aiming to detect hidden normative foundations in apparently ‘technical’ and ‘scientific’ discourses. His special focus is on a ‘theological’ reconstruction of the teachings in Harvard (Paul Samuelson) and Chicago (Frank Knight, Milton Friedman, George Stigler) as the two dominant schools of economics in the United States. He then goes on to consider the approaches of ‘institutional economics’. Nelson’s point is that modern economists, contrary to their self-understanding as scientists, actually are taking the role of preachers: ‘Beneath the surface of their formal economic theorizing, economists are engaged in an act of delivering religious messages. Correctly understood, these messages are seen to be promises of the true path of salvation in this world – to a new heaven on earth’ (Nelson 2001: xx). He then continues: ‘Startling as the thought must be to most current economists, it may be that their most important social role has been preachers of a religion with the special character that it acts to uphold the normative foundation required for a rapidly growing economy’ (Nelson 2001: 8). Economic ‘theology’ is preaching the values of rationality and efficiency as a means to attain a state of material abundance, which would put an end to the evils of this world and establish a paradise on earth. Its main task is to solve what Nelson calls the ‘market paradox’: encouraging self-interested and profit-maximising action while at the same time upholding the social virtues of markets, such as adherence to contracts; honesty and trust in business transactions; and commitment to the greater public good. Nelson views the economic profession as a new priestly class preaching the new gospel of this-worldly salvation by seeking never-ending material progress. What still had been considered merely as a symptom of religious salvation in the Protestant tradition – capital profit – inadvertently became its very substance.

A point that has remained ambiguous in Nelson’s approach is the question of the genuine object and level of his analysis. Does he focus only on the alleged transformation of the economic profession into a preaching class, or does he actually talk about larger, structural transformations of society and religion? Theology as a reflexive discourse on religion should not be mixed up with religion itself. Religion is based on primary experiences of revelation – consider, for instance, Moses’ encounter with God on Mount Sinai – and sacred texts and rituals passing on these experiences and keeping them alive. Theology comes into play only in a second step, if a religious belief becomes institutionalised and, hence, needs to be explicated, interpreted and applied to concrete social situations. Parallel to this, one would have to observe the difference between primary economic practice and the experiences arising from it and economics as a scientific reflection of practical experiences. Thus, even if one accepts Nelson’s thesis of an inner affinity between economics and religion, it would have been more adequate to characterise economics as a kind of ‘theology’ of economic practice, not as a ‘religion’, as Nelson does. Beyond Nelson’s perspective on the economic profession, a separate analysis of the modern capitalist economy itself, its historical context, and its original icons, rituals and legends would have been required to make his case, and such an analysis is lacking in his writings.

Birger Priddat’s interpretation of capitalism as a secularised version of Christian eschatology (Priddat 2013, 2015) is not free from the inclination to mix up immanent reconstructions of economic and social thought with historical context analysis either. Taking Smith’s theorem of the invisible hand as a starting point, Priddat interprets modern capitalism as a system where the transcendent dimension of the old theological oikonomia has been replaced by the concept of an open earthly future for mankind. As he argues, Smith’s position in the history of economic thought is central, because his theory marks the transition point between the old, theological and the new, capitalist oikonomia . While Smith attributed the working of the invisible hand still to God’s providence, the benefits resulting from it no longer flow to the redeemed, but to the lesser mortals. The new capitalist oikonomia is embodied in the credit system and the capital form of money. As capital, money no longer is a mere medium of circulation, but is bound to be invested into projects that will pay off (or not) in an uncertain future. With the capitalisation of money, the organisation of social time changes, as it no longer follows the cyclical logic of a traditional, stationary economy. The new mundane ‘religion’ of capitalism is governed by an imperative of growth, transforming time into a dynamic, linear, future-oriented flow. The growth imperative corresponds to an imperative of credit and debt, which Priddat interprets as a ‘secularisation’ of the biblical concept of sin (Priddat 2015: 154). Again the question remains open: how does a change in the level of ideas about money and credit give rise to a new ‘religion’? If something like a new religion actually were to emerge, this would presuppose a social transformation much larger than a merely conceptual one. What is lacking in Priddat, as well as in Nelson, is a thorough analysis of the structural changes of society itself that give rise to the alleged ‘new religion’.

As a first step towards a more comprehensive analysis, the changes in the role of economic science highlighted by Nelson and Priddat should be located in the context of the larger debate on secularisation, which began between philosophers and historians after the Second World War. Karl Löwith’s analyses of the theological background of modern ideas of mundane progress are instructive as a starting point (Löwith 2004). The big European revolutions in the new age – the political ones of the seventeenth and eighteenth centuries as well as the industrial revolution of the nineteenth century – were accompanied by sweeping visions about a new human civilisation to come. Despite their vast differences, these visions – Löwith comments on the conceptions of Giambattista Vico, Nicolas de Condorcet, Turgot, Voltaire, Pierre-Joseph Proudhon, Auguste Comte, Georg Wilhelm Friedrich Hegel and Marx – coincided in their critique of traditional theological interpretations of history. History no longer was interpreted as a process governed by divine providence, but as one that is, whether consciously or not, made by man himself. The common point of the enlightened proclamations was their confidence in humans being capable of building a new society, which would be much more peaceful, just and affluent than the existing aristocratic order. Modernity would provide freedom for the individual by having society coincide with the freedom of all. Even more so, some theoreticians (Hegel, Comte, Marx) postulated ‘laws’ of reason governing history from within and leading mankind, even without intention, to ever higher levels of global civilisation.

Löwith’s critique of the idealistic philosophy of history focuses on two points. First, drawing on Jacob Burckhardt he argues that there is no scientific justification for any ‘laws’ of history and for predicting its course on their basis. The future, let alone the ‘end of history’, cannot be known by anyone. The very assumption of humans being the subjects of their own history is incompatible with the parallel assumption of a ‘higher’ logic of human progress governing history. If men really were masters of their own history, the future would be contingent solely on their own action, and thus would be completely open and indeterminable for any non-participant observer. As rational justifications can be ruled out, the only possible explanation for the idealistic belief into progress and human emancipation lies in its implicit reference to the idea of salvation anchored in the Christian legacy. Indeed, the idealist philosophy of history came down to a ‘secularisation’ of Christian faith as the vision of salvation got applied to the earthly fate of men and transformed into a programme for mundane progress.

Löwith’s second point is that this notion rests on a fundamental misunderstanding of the original biblical doctrine. As he argues, the term ‘salvation’, as coined by Paul and then later Augustine, referred to the redemption of man from sinful earthly existence, and it had nothing to do with any idea of mundane improvement. Löwith concedes that Christian teaching, with its message about the birth, death and coming return of Jesus Christ, introduced an entirely new understanding of time as a linear, future-oriented movement differing from the cyclical time conceptions of Greek cosmology. However, the new order of time had no historical meaning except for its reference to the historical events of the arrival and ‘re-arrival’ of Jesus Christ. Beyond that, historical time was interpreted as a period for the believers to wait for the return of Christ, with no inherent determination as to earthly progress. The philosophers of enlightenment, however, developed the idea that humans should no longer content themselves to wait for the return of Christ, but should rather take their destination into their own hands (see Koselleck 2003: 177–178). In Löwith’s view, this secular turn in Christian eschatology meant a thorough misinterpretation of the original doctrine of salvation. Its legitimacy was ambiguous, as it depended factually on the very same theological heritage which was the target of its critique.

Löwith’s interpretation did not remain uncontested. Prominent critics of it were Hans Blumenberg (1996 [1966]: 35–36) and Jürgen Habermas (1971), both insisting on the genuine character of the legitimacy of modern secular philosophies of history, albeit arguing from different premises. Blumenberg interpreted secularisation as a legitimate self-defence of reason against the agnostic and disorganising consequences of theological ‘absolutism’, which he located in the advance of the nominalist school and its view of God as an absolutely sovereign and transcendent ruler in the early new age (see Blumenberg 1996 [1966]: 401–402). Habermas took recourse to the built-in rationality of communicative action, which he interpreted as the driving force of the modern secularisation of Christian faith. For lack of space, I do not go deeper into this debate here, but it suffice it to say that the critics have shown that Löwith’s analysis leaves open a key question: if the legitimacy of the secular turn of Christian eschatology is so doubtful, how could it nevertheless become so overwhelmingly successful?

An influential recent attempt to reconstruct the rise of secular society from an encompassing perspective is Charles Taylor’s A Secular Age (Taylor 2007). Taylor’s analysis of secularisation focuses on three key characteristics: the first characteristic of secularised societies is that in such societies religions have lost their former dominance in the public arena. The self-evident ever-presence of God in public life in pre-modern societies has given way to a plurality of different social spheres, each of them being governed no longer by religious principles but by their own norms. Moreover, the religious sphere itself is characterised by a colourful pluralism of beliefs. The second characteristic is the manifest decay of church life as it reveals itself in declining commitment to religious customs and decreasing attendance at church services, both of which can be observed at least in many Western countries. The third, and perhaps most important, characteristic is the perception of religious belief not as a self-evident and uncontested tradition but as a personal option that may be chosen. Thus, even societies showing no visible decline, or even an upswing, in religious activities (e.g. the United States) can be called ‘secular’ if church affiliation is no longer obligatory for everybody, but is instead based on personal choice and commitment. The optionality of the belief in God, in turn, depends on what Taylor calls the ‘immanent frame’ (Taylor 2007: 539–540), which is a cultural identity that is no longer open to the experience of transcendence, but which is centred instead on the mundane well-being of man and on the principle that each individual is responsible for seeking their own destinies. To characterise this frame, Taylor also introduces the term ‘exclusive humanism’ (2007: 19).

The first part of Taylor’s voluminous study is devoted to a historical and philological reconstruction of the rise of exclusive humanism during the Modern Age in Europe. Following Max Weber’s (1972, 1978) and Richard Tawney’s (1926) analyses, Taylor argues that the reformatory move to make evangelical prescriptions obligatory for ordinary believers had the unintended effect of giving rise to a ‘disciplinary society’ focusing on thorough control of daily social life. Moreover, he points to Hugo Grotius’ and John Locke’s ideas about a ‘natural’ moral order based on the institutions of possessive individualism and to the concept of civil society emerging at the time. The modern market ‘imaginary’ of individuals meeting freely for exchange and seeking their personal gain is a cornerstone of Taylor’s concept of exclusive humanism (2007: 159–160). So far, Taylor’s analysis marks a counterpoint to economic theology, since in his view it is just the development of the economic institutions of private property and civil society that contributed to the rise of a ‘secularised’ society buffering itself against the experience of transcendence (2007: 176–177). Following Weber once again, he characterises the transition from pre-modern societies open to God and cosmological forces to modern enlightened humanism as a process of ‘disenchantment’. Interestingly, Taylor also uses the term ‘disembedding’ to describe the same process, thereby unintentionally reminding us of Karl Polanyi’s analysis, which I will come to below (2007: 146–147). Up to this point, there seems to be no room for any ‘economic theology’ in Taylor’s approach.

However, Taylor is clearly aware that such an interpretation alone would not suffice. He distances himself from ‘subtraction stories’ of secularisation, and describes it as a process by which society frees itself from the ballast of religious superstition and concentrates its energies on the rational mastery of mundane life. Of course, he also knows that the fathers of the idea of civil society, Hugo Grotius, John Locke, Adam Ferguson, and Adam Smith, were anything else but hostile towards the idea of a divine creator instituting the rules of society. Even Smith’s theory did not imply a complete departure from theology, though Smith’s idea of God reduced itself largely to the rationalised constructions of Deism. Religion and civil society are not necessarily antagonistic to each other. Had the idea of the ‘buffered’, self-controlled and self-sufficient individual actor really been the last word of exclusive humanism, it could not have challenged the Christian heritage so profoundly. To bring exclusive humanism into the position of a genuine alternative to religion, additional forces must first have come into play. Secular humanism had to offer also new ways to explore the ‘fullness’ of life, as Taylor puts it – that is, to open new dimensions of moral and spiritual experience. Indeed, this is what happened, as Taylor tries to show in his voluminous chapter about the ‘nova effect’ of new spiritual, aesthetic, religious, and anti-religious movements that have emerged since the late eighteenth century. Moreover, in the twentieth century the nova effect continued, penetrating popular cultures and creating a generalised culture of ‘authenticity’ and expressive individualism (Taylor 2007: 299–300).

As critics have noted, the problem with Taylor’s approach, besides its one-sided focus on the Western and Christian tradition, lies in its culturalist bias (Koenig 2011). This applies in particular to the second and third steps of his analysis, the reconstruction of the Romantic counter-movements against enlightened humanism and of their repercussions in the twentieth century. While Taylor’s analysis of the rise of the humanist alternative to Christian faith still takes account of hard-core economic and institutional changes – in particular of the regimes of private property and natural law – such references are lacking almost completely in the subsequent parts of his study. There, Taylor focuses almost exclusively on the dimensions of cultural, moral, spiritual and aesthetic experience, while playing down economic, institutional and political change.

The perspective of this study is not a theological but a sociological one. My aim is to develop a deeper understanding of the manifest or latent proximity between theology and key traditions of economic theory by taking a third perspective, that of social theory. The study refers to the questions left open by Taylor, Nelson and Priddat. I will argue that the case for a ‘theological’ perspective on the economy first of all depends on a clear methodological distinction between social practice and the intellectual reflection of this practice. If there is something like a ‘religious’ quality to the economy, it first needs to be identified on the level of social practice and social institutions, the ‘theological’ reflection of practice coming into view only in a second step. A broad sociological view of the institutional transformations underlying the rise of modern capitalism, beyond a culturally biased account like Taylor’s, is required to understand the influence of theological thought on economic science. The focus of the socio-historical analysis which I am suggesting will be on the process which economic sociologists describe as the ‘disembedding’ of markets. The term is understood here as a negative counterpart to Karl Polanyi’s concept of the social ‘embeddedness’ of markets (Polanyi 1944). Polanyi himself characterised the rise of modern industrial capitalism – the ‘Great Transformation’, as he called it – as a process where markets became ‘disembedded’ from their traditional institutional framework, and that this process gave rise to global capitalism as a system of ‘self-regulated’ markets.

As we have seen above, Taylor employs the same term, albeit in a very different sense. In Taylor’s account, the concept of ‘disembedding’ denotes the transition from an enchanted world, open to supra-natural forces, spirits and demons, to the coherent and rational order of modern civil society (Taylor 2007: 146–147). The key point of the present study will be that this is not the whole story and that the continuation of the story is different from what Taylor suggests it is. We have to distinguish the first move of disembedding, as described by Taylor, from a second move of disembedding, that is, the disembedding of markets from their politically and religiously legitimated institutional framework in the sense first described by of Polanyi. The second move refers to the transition of institutionally embedded civil society, as it had evolved in the eighteenth century, to the global system of capitalism emerging in the nineteenth century. As I will explain in detail below, the disembedding of markets includes a spatial (or territorial) dimension, as well as a social, material and temporal one; in other words, it covers all dimensions of human existence. The result is not, as I will argue, the transformation of society into Weber’s often cited ‘iron cage’ of instrumental rationality. To the contrary, the second move results in a re-enchantment of the economy and society, which, in some sense, comes down to a reversal of the first move of disembedding. As Martijn Konings puts it: ‘Far from being characterized by a growing externality of economy and sociality, capitalism operates through their imbrication: morality, faith, power and emotion, the distinctive qualities of human association, are interiorized into the logic of the economy” (Konings 2015: 2). In a similar vein, Jens Beckert speaks of an ‘enchanted world of capitalism’ (Beckert 2016: 269).

The disembedding of markets refers to a spectacular expansion of the property options of money in all four dimensions cited above. Pushed by the promises of an ever-present market narrative, the reach of markets and money did not only expand territorially, as the well-known concept of ‘globalisation’ suggests. The commodification of social relations intensified too; moreover, the scope of marketable objects was enlarged due to the extension of the market nexus from finished products and services to the conditions of production (land, means of production, labour). The capital form of money, which had formerly been confined to the sphere of commerce, spread into the sphere of production. Money was no longer an entitlement for merely what had been produced , but also for what could be produced via the organised exploitation of the creative potential of labour, and this opened the economy up to the dimension of time. The economic process detached itself from nature-based and cyclical forms of time, and developed its own linear and future-oriented logic; dreams, technological visions and ‘imagined futures’ (Beckert 2016) became vital to keeping the system moving. Society indeed found itself faced with vast promises of earthly progress and welfare; however, it also found itself faced with hitherto unknown social polarisations and threats. Above all, there is the polarisation between those owning capital and wealth and those owning little or nothing and finding themselves positioned on the debt side of wealth. The capitalist universalisation of markets gave rise to the social dichotomy of capital and labour, which laid the ground for intense processes of social emulation, whose consequences were not only destructive, as Mishra (2017) argues, 5 but also productive. With the commodification of labour, capitalist entrepreneurship and a dynamic mode of social reproduction emerged. One industrial revolution followed another, and continuously emerging technical utopias and inventions gave rise to processes of ‘creative destruction’, to cite Joseph Schumpeter’s well-known term. Nevertheless, the integrative potential of markets and money clearly has its limits and cannot always prevent the turn from productive to destructive modes of emulation. Capitalism has always tended to evoke more dreams and aspirations than it could fulfil. Thus, men find themselves again in a world of existential uncertainty, of unheard of promises, and of abysses: a kind of uncertainty, however, which this time does not go back to supra-natural spirits but to none other than humans and their own ‘demonic’ drives (Tillich 1988, 1989).

Markets are a calculable and profane reality only as long as they continue to be embedded in an institutional order based on political or religious values – this being not only Polanyi’s point, but also that of the above-discussed theories of economic ordoliberalism. With their disembeddedness, markets no longer constitute a mere economic sub-system within society , but the most encompassing of all social systems, governing individual actors not only via external constraints, but also via framing their ‘inner worlds’, their thoughts and their perceptions. 6 As an encompassing system, it is indeed a ‘black box’ that, as a whole, is inaccessible to any observer because the observer would have to be more intelligent than the very sum of human intelligence operating in the system itself. Observations are social acts being possible only within society and relative to the particular social position of the observer, and not from any ‘external’ standpoint. Even economic science meets its limits here, and can ignore these limits only at the expense of either being empirically void, or of ending up as a morally laden, highly speculative discourse (Foley 2006). The only way out of this dilemma would be to renounce the holistic pretensions of economic theory and to concentrate on empirically verifiable but historically contextualised partial analyses, as many economists are in fact doing. This, however, is not compatible with their moral role as experts of the common good, a role which economists nevertheless still have their eyes on, as Nelson had noted (see above). Today, there is a growing awareness even amongst economists that economics cannot take the role of an ‘oikodicee’ for society, as Joseph Vogl (2010) has put it. 7 As an encompassing social system, disembedded markets are an opaque reality, impervious to coherent rational explanations. When nevertheless proposing the ‘heuristic fiction’ of rational and efficient markets (Beckert 2016: 256), economic theory does not follow scientific reason in the first instance, but the practical needs of a society having to cope with the real contingencies of markets. What is relevant is not whether theories are true or false, but whether they are credible and capable of guiding economic action and political decisions. From this viewpoint, the social role of economic theory resembles that of theology, which is to endeavour to translate the superior intelligence of God in a way that is accessible for human reason and practice. Though differently from theology, economics is not in a position to have recourse to holy scripts revealing God’s intentions.

The epistemological puzzle coming into view here is not only one of economics, but also one of sociology and of the social sciences in general. It arises as soon as ‘society’ as a whole is taken as an object of scientific analysis, 8 and it applies to markets too in the case of the latter becoming an encompassing social reality due to the disembedding process. The only thing that social scientists can do is take the position of a second-order observer – that is, not taking society as a direct object of observation, but reconstructing the ways in which social actors imagine their collective identity and their environment. How do actors cope with an environment which they perceive as opaque and uncertain? The classic field where sociologists have followed such kinds of questions is the sociology of religion. It is neither necessary nor possible here to recapitulate the sheer variety of sociological approaches to the study of religion. 9 For the present purposes, it is sufficient to remind you, the reader, of two influential conceptualisations, which in fact – as we shall see later more in detail – are intertwined with each other. The first one, going back partly to Max Weber and taken up recently by Martin Riesebrodt, focuses on the problem of contingency. It defines religion as a system of beliefs in supernatural powers which are deemed to control conditions of mundane life outside of human influence. These beliefs, as ‘premises’ of religion, are combined with practices that are designed to communicate with the supernatural powers: ‘Religious practices, as a rule, aim to establish contact with or access to these powers with means that are culturally given’ (Riesebrodt 2007: 113, my translation). Religion is interpreted as a social system helping the followers to manage existential contingencies by entering into a communicative relationship with the superior powers, and trying to influence their will in a way that is beneficial to the followers (and to humans more generally). By establishing a relationship with the gods or one single god (or God), the believers constitute a social order amongst themselves in an indirect way. This is the point of the second type of conceptualisation, which goes back to Emile Durkheim and Georg Simmel and their emphasis on the ‘social’ character of the religious imagination: ‘A religion is a unified system of beliefs and practices relative to sacred things, that is to say, things set apart and forbidden – beliefs and practices which unite into one single moral community called a Church, all those who adhere them’ (Durkheim 1995 [1912]: 44). This definition focuses on the capacity of religions to constitute overarching forms of moral communities. Different from particular communities like families or ethnic groups, the religious community is the most encompassing one and, hence, a singular one; in this sense, religion is constitutive of ‘society’ (Durkheim 1995 [1912]: 421). In a similar vein, Simmel interpreted religion as a special type of social relationship, distinguishing itself by its unconditional and encompassing character (Simmel 1992 [1898], see Joas 1997: 110).

The sociology of religion is not theology; it cannot provide information about superhuman powers via the interpretation of holy scripts, testimonies and other sources of revelation. What it can do, however, is analyse the practical consequences of human action being guided by the belief in superhuman powers, or by the collective nexus of a church. What is relevant for sociology is not the question of the ‘inner truth’ of the religious imagination, but rather its impact on social action. This is the programme that Max Weber followed in his studies on world religions and the programme that I will follow here too, albeit only in a methodological sense and not in a substantial sense. In contemporary global capitalism, the management of uncertainty is clearly no longer the exclusive domain of traditional religions; instead, disembedded markets have evolved as a key field of existential contingencies. As I will argue in this study, markets have become a powerful competitor to the world’s religions in at least two respects. First, markets have become a truly global social nexus, surpassing even the universality of the traditional world religions and religion-based civilisations. 10 Second, markets can no longer be characterised as a profane area of mere ‘material’ reproduction and utilitarian action, as the usual economic argument goes. Instead, markets have become a social system, which, like the religions, opens ways to experience the unknown and permeates social and individual life in an encompassing way. If we follow Durkheim in characterising religion as the utmost universal form of sociality, then it is capitalism and not any of the historical world religions which constitutes the genuine religion of modernity. What I am developing here is an approach to analysing the practical conditions, implications and consequences of individuals and collectives being guided no longer by the superhuman power of the gods, but by the forces of disembedded markets.

The plan of the book is as follows: Chapters 2 , 3 and 4 concentrate on the issue of disembedded markets from a historical point of view, starting with a discussion of the ambiguities and deficiencies in Polanyi’s work (Chapter 2 ). My suggestion is to read Polanyi against the grain, that is, not as a theorist of economic embeddedness, but as one of disembedding. I will point to the modifications to and corrections of his analysis that appear to be necessary from such a perspective. Chapter 3 defends the liberal conception of private property as a universal social system against the critical denunciations of markets as a system of merely utilitarian or instrumental action. Moreover, I will highlight the role of the liberal market narrative in promoting the historical process of disembedding. Chapter 4 presents a stylised historical analysis of the disembedding process in its territorial, social, material and temporal dimensions, and of its built-in countervailing forces. Again, my intention here is to elaborate Polanyi’s double-movement theorem and to correct its asymmetries and analytical deficiencies.

Chapter 5 turns to social theory, and it discusses the issues of functional differentiation and of the place of disembedded markets in a functionally differentiated society. As I will argue, the common system-theoretical description of modern markets as a core of a functionally defined ‘economic’ sub-system appears deficient, since it does not account for the disembedded character of modern, globalised markets. The universal character of markets suggests a comparative discussion of religion and its place in society. Recapitulating a broad consensus amongst sociologists of religion, I argue that religion in stratified societies has become a way for these societies to represent themselves in the double sense of marking the most encompassing level of collective identity and constituting the interface between society and its extra-social environments. Chapter 6 turns to global capitalism and the relationship between modernity, capitalism and religion, starting with a critical review of the return of religion thesis. In Chapter 7 , I will discuss the key question of whether capitalism can do without a supreme value system reflecting the collective identity of society (as the theory of functional differentiation pretends). Here, I will focus critically on Niklas Luhmann’s system-theoretical approach and his analysis of the inherent epistemological paradoxes of the concept of modern society. Though Luhmann offers a clear discussion of these paradoxes, I argue that his concept of societal ‘self-descriptions’ remains deficient; although he played with the idea, he did not consider the possibility of interpreting disembedded markets as the functional equivalent of religious self-descriptions. Chapter 8 offers a critical examination of the functional equivalence thesis, focusing on social universality and contingency management as the key dimensions of functional equivalence. As I will argue, the thesis of a functional equivalence between capitalism and religion can be followed only with major reservations. I will emphasise the limits of disembedding, and the vicious feedback evolving in the globalisation of markets, as well as in the processes of capitalist growth and ‘creative destruction’. Chapter 9 deepens the issue of contingency management by developing a multi-level sociological model of capitalist dynamics, focusing on the macro–micro interactions in the process of capitalist growth. This will bring additional light to the analysis of the vicious circles inherent in the logic of creative destruction. The findings will be related to the actual debate on the phenomenon of ‘financialisation’. The conclusion ( Chapter 10 ) brings together the various threads laid out in the previous chapters, culminating in the thesis that the capitalist dream of absolute wealth is destroying itself, just as it is coming close to being a ‘religion’ of mankind.