Understanding Economic Moral Hazard and Its Implications in the Writings of `Abdu'l- Bahá
First presented at the Irfan Colloquia Session #111
Centre for Bahá'í Studies: Acuto, Italy
June 30 – July 3, 2012
(see list of papers from #111)
The role of society and governments in resolving financial crises and addressing the persistence of poverty and unemployment, including their prevalence in the wealthiest countries of the world, is now under the widest scrutiny since the Industrial Revolution brought about the confluence of forces that had led to the Great Depression over 8 decades ago. Once again, our society is forced to reflect on its motives and priorities at individual and aggregate levels in order to address and avoid a pending economic collapse. The identification and understanding of moral hazards, which have perpetuated an economic system fraught with structural weaknesses, is a necessary step towards understanding the current devolution and potential demise of Western economies.
Less than 2 decades before the Great Depression, `Abdu'l-Bahá, through his writings and frequent public addresses in Europe and North America, revealed far-reaching insights into understanding and eventually resolving these moral hazards, thus setting the stage for arriving at a more comprehensive resolution of economic problems that shall confront humanity over the coming century.
This paper would strive to analyze how `Abdu'l-Bahá's selected public addresses provide insights into these economic moral hazards and how our society should respond, by examining:
We shall reflect on `Abdu'l-Bahá's public discourses, a century ago, in this regard and on how he addressed these moral hazards and what would be their implications.
- Who bears the responsibility for addressing persistence of poverty?
- How can governments and individuals address the structurally imbedded moral hazards when confronting pervasive poverty and unemployment?
- Can a fair and democratic society eliminate extreme wealth created by corporate responsibilities towards profit maximization of shareholders?
- Why universal and affordable education, along with widely available free information provided by technological revolution of the past 2 decades, have not reduced the acceleration of extremes of wealth and poverty?
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