Bert Olivier
Bert Olivier

Max Weber on capitalism and religion

What must surely count as one of the shrewdest, albeit debatable, accounts of the distinctive traits of capitalism was penned by the justly famous German sociologist Max Weber in his controversial book, The Protestant Ethic and the Spirit of Capitalism of 1930 (London: Routledge Classics, 2001).

The reasons for its controversial status are summarised as follows by Anthony Giddens in the Introduction (p. xix):

“The most important reason for the emotional intensity provoked by the book is no doubt the fact that the two major terms in Weber’s equation, ‘religion’ and ‘capitalism’, were each potentially explosive when applied to the interpretation of the origins of the modern Western economy. Weber argued for the transformative force of certain religious ideas, thus earning the opposition of most contemporary Marxists; his characterisation of Catholicism as lacking in mundane discipline, and as a retarding rather than a stimulating influence upon modern economic development, ensured the hostility of many Catholic historians; and his analysis of Protestantism, emphasising the role of the Puritan sects (whose influence is in turn linked to the ‘iron cage’ of modern culture), was hardly likely to meet a universal welcome from Protestant thinkers. Finally, the use of the term ‘capitalism’ was controversial in itself: many were, and some still are, inclined to argue that the notion has no useful application in economic history.”

Weber captures the “spirit” of capitalism in terms of what he terms a “calling”, which he justifies by quoting Benjamin Franklin formulating guidelines for the appropriate behaviour of employees under capitalist conditions (Franklin in Weber 2001 :14-15):

“Remember, that time is money. He that can earn ten shillings a day by his labour, and goes abroad, or sits idle, one half of that day, though he spends but sixpence during his diversion or idleness, ought not to reckon that the only expense; he has really spent, or rather thrown away, five shillings besides.

Remember, that credit is money. If a man lets his money lie in my hands after it is due, he gives me the interest, or so much as I can make of it during that time. This amounts to a considerable sum where a man has good and large credit, and makes good use of it…

…After industry and frugality, nothing contributes more to the raising of a young man in the world than punctuality and justice in all his dealings; therefore never keep borrowed money an hour beyond the time you promised, lest a disappointment shut up your friend’s purse for ever.

The most trifling actions that affect a man’s credit are to be regarded. The sound of your hammer at five in the morning, or eight at night, heard by a creditor, makes him easy six months longer; but if he sees you at a billiard-table, or hears your voice at a tavern, when you should be at work, he sends for his money the next day; demands it, before he can receive it, in a lump.

It shows, besides, that you are mindful of what you owe; it makes you appear a careful as well as an honest man, and that still increases your credit.”

The moral of these observations is clear: under capitalist conditions everyone who has to earn a living (ie most people) should behave in such a way that they are perceived as keeping their noses to the grindstone and as servicing their debt conscientiously and punctually; in the absence of this your indispensable creditworthiness collapses. Moreover, as mentioned above, Weber regards Franklin’s exhortation to workers as a formulation of nothing less than a “calling”, that is, an injunction to labour with unfailing conscientiousness.

Contrary to what one might expect, it is striking that Weber describes the behaviour of individuals which he sees as exemplifying the capitalist ethos encapsulated in Franklin’s advice in terms of irrational motivation: “He gets nothing out of his wealth for himself, except the irrational sense of having done his job well” (Weber 2001: 33) and: “We are here particularly interested in the origin of precisely the irrational element which lies in this, as in every conception of a calling” (p. 38).

What Weber regards as being peculiar to what he calls a “philosophy of avarice” (p. 17) is particularly the notion that individuals have a DUTY to increase their capital; in other words, it assumes the proportions of an ethical obligation. As he puts it (p. 17): “It is not mere business astuteness, that sort of thing is common enough, it is an ethos.” This was what interested Weber – whence this quality of moral obligation in Franklin’s practical advice on “proper” behaviour under capitalist circumstances?

It may come as a surprise to readers that Weber (2001) ultimately uncovers such punctilious labouring as having its roots in the convoluted history of Protestant practices (too involved to pay detailed attention to here), which were eventually discarded when capitalism had developed sufficient independence to be able to do without religious justification of its work ethos. He establishes the link between capitalism and religion as follows (p. 18):

“In fact, the summum bonum of this [capitalist] ethic, the earning of more and more money, combined with the strict avoidance of all spontaneous enjoyment of life, is above all completely devoid of any eudæmonistic, not to say hedonistic, admixture. It is thought of so purely as an end in itself, that from the point of view of the happiness of, or utility to, the single individual, it appears entirely transcendental and absolutely irrational. Man is dominated by the making of money, by acquisition as the ultimate purpose of his life. Economic acquisition is no longer subordinated to man as the means for the satisfaction of his material needs. This reversal of what we should call the natural relationship, so irrational from a naïve point of view, is evidently as definitely a leading principle of capitalism as it is foreign to all peoples not under capitalistic influence. At the same time it expresses a type of feeling which is closely connected with certain religious ideas.”

Weber points out that in New England, where Franklin was born, there was evidence of the “spirit” of capitalism, outlined above, before it was established as a distinctive economic order (p. 20). It was here that the peculiar character of capitalist behaviour as a “duty” developed, which was new, according to him. He readily grants that monetary acquisitiveness (had) existed in many other places and countries, sometimes accompanied by conspicuous unscrupulousness, but without the spirit that marks capitalism as an ethos demanding duty-bound labour, so well captured in Franklin’s words, and often accompanied by an ascetic tendency (p. 33).

Weber (2001: 19-20) is quite aware that people who are born into the capitalist universe do not necessarily “consciously” accept these “ethical” precepts; at the same time, if one does not assimilate and live according to them, he points out, one would soon be ejected mercilessly:

“The capitalistic economy of the present day is an immense cosmos into which the individual is born, and which presents itself to him, at least as an individual, as an unalterable order of things in which he must live. It forces the individual, in so far as he is involved in the system of market relationships, to conform to capitalistic rules of action. The manufacturer who in the long run acts counter to these norms, will just as inevitably be eliminated from the economic scene as the worker who cannot or will not adapt himself to them will be thrown into the streets without a job” (Weber 2001: 19-20).

To be sure, since Weber wrote this in the early 20th century capitalism has passed into a new phase of development, with the financial sector surpassing the manufacturing sphere in importance. Hence it is a moot question, whether the capitalist ethos discerned by Weber is still as central to labour under capitalist conditions. Judging by what some see as increasing resistance to capitalist work, it may indeed be the case.

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    • http://necrofiles.blogspot.com Garg Unzola

      Prof Bert, I must commend you. Weber doesn’t write patent nonsense as D&G do, it is at least a plausible premise and something to mull over. It is at least a consideration of work ethic and how it relates to material wealth, as well as a reckoning of a socio-economic system as it is (more or less), as opposed to someone projecting their time spent in an asylum onto society as a whole.

      Our 20th century capitalism is largely driven by debt – oddly enough, not so much by what one earns and owns but what one needs and owes.

    • Bert

      Thanks, Garg. You’re wrong about D & G, though. What you have to do is to look carefully at their ‘model’ of capitalism and see whether it illuminates existing practices. A wonderful book that explains D & G’s sometimes confusing terminology clearly, is Ronald Bogue’s book on “Deleuze and Guattari”. If you are interested in getting to grips with them, this is where to start.

    • Bert

      And Garg – I forgot to say, please drop the ‘Prof’. Titles really mean nothing; all that counts is whether one can do what you are supposed to be able to do.

    • Joseph Coatesi

      If you look at the parable of the 10 talents (money) in the Bible, you will see that ONE is give a choice what to do with your Money and how to use it so it could multiply . so you can put it to good use. In otherwise use it , don’t lose it as the one given only say
      R10.00 never put it to use and lost it eventually.
      Capitalism is for those risking everything and working to fulfill a dream and keep the economy afloat and is normally the small business corperations that fit into category.
      Also it’s how the individual operates his operation & what responsiblity over debt that needs to paid etxc…etc.

    • http://necrofiles.blogspot.com Garg Unzola

      @Bert:
      You are wrong about D&G. The reason for this is that they do not illuminate anything.

    • http://thememorybank.co.uk Keith Hart

      Thanks for this, Bert. I recommend a recent book by Noam Yuran, What Money Wants: An Economy of Desire (Stanford UP, 2014, preface by yours truly), which juxtaposes Marx, Weber and Veblen is a strikingly original way. Briefly, he reformulates the Weber thesis as follows. Religion and economy have been linked from the beginning of capitalism, but at first the religion made the economic element invisible. Later capitalism destroyed its own religious roots, leaving only economic motivation visible. But the religious aspect is still there, just as the economic was originally. It is up to us to work out what that means now (money as capitalism’s religious object). Yuran’s basic thesis is that history resides in objects whose meaning we don’t grasp subjectively. Mainstream economics fails because of its reliance on individual subjectivity and its lack of history.

    • http://nicholasjakari.com GenaSap…

      “This reversal of what we should call the natural relationship, so irrational from a naïve point of view, is evidently as definitely a leading principle of capitalism as it is foreign to all peoples not under capitalistic influence.” Weber

      “In fact, the summum bonum of this [capitalist 'C'] ethic,…appears entirely transcendental and absolutely irrational.” Weber.

      Adam Smith suggested that in a Rational world the laws of contract could become unenforcible. Max Weber clearly identified that ‘C’ irrationality, in a religious ideology born out of Protest [ant] against a ruling order corrupted through unmitigated greed, ‘C’ then drove the entire planet to the palace of wonders with which we live today.

      Now we have not only morphed from a manufacturing society [previously agrarian] to one where 60% of our country’s earnings comes from the intangibles in the Tertiary sector. And we have discovered a universal truth that a ‘bribe in time saves nine.”

      This means that we are no longer in a ‘Capitailst’ world such as Weber described, because we understand that the idea of duty, of behaving according to one’s word, are oddly old fashioned and hustling people out of their money is de rigeur, something Argentina is hoping to demonstrate, and which Weber’s demeaned Catholic European states have demonstrated so gloriously over the past decade.

      As you you succinctly point out “… the notion ['C]‘ has no useful application in
      economic history.”…

    • Richard

      Is it not the case that capitalism is simply one of many aspects of life that was brought into the ambit of religiosity, simply because that was the manner in which “good” was separated from “bad” conduct? There were many other avenues of life into which religion strayed, that were not necessarily “religious”: think of the geocentric world-view say, which was not an article of faith anywhere in the Hebrew/Christian bible. Somewhere along the line, these notions became conflated. What this article did remind me of, though, was the manner in which capitalism has become so intricately intertwined with the American psyche. It is no surprise to realise that the American version of religion is really more gnostic than normative, in that it seeks to place the locus of God within the individual rather than mediated by the Church (as Harold Bloom says, the Christ of the Resurrection rather than the Crucifixion, which is more European turf). Such gnosticism neatly segues with capitalism, which is interpreted as the individual’s search for betterment through material acquisition, rather than state control (for which read Church control), again much more the European religious experience. This metaphor is then easily made malleable, with moral dimension able to be added to what is the human stage (this world) and its striving, calibrated in money-terms. This American need to make of money a religion is then not so strange. Charles Dickens certainly noted it in his “American…

    • Richard

      Notes”.

    • http://necrofiles.blogspot.com Garg Unzola

      @GenaSap:
      What do you make of the Wiki criticism of Weber’s work?

      https://en.wikipedia.org/wiki/The_Protestant_Ethic_and_the_Spirit_of_Capitalism

      The Protestant work ethic versus Catholic world view makes sense to me but there were anti-mercantilist and pro-Capitalist strands earlier than the official Classical Liberal version. In Catholic countries, no less.

      Though it’s probably more important to note Weber’s Disenchantment. I think it’s a more recurring phenomenon and perhaps the social sciences as a whole would be the last of its victims.

    • http://nicholasjakari.com GenaSap…

      @Garg Unzola.

      Thanks for the link it was interesting. As for the critiques i think time itself is the arbiter. Credit [the founding premise on which 'Capitalism' is based], has been around since .time immemorial, It was old well before the time presented by the Revisionist argument. The Protestant movement is almost modern by contrast. There were also plenty of Catholics going around whipping themselves as a sign of obedience to some ethical and moral idea of frugality.

      Plus, of course the treatment of failed debtors was always harsh… as it should be.

      And then of course the Chinese too were involved in moneylending back before Catholicism was born.

      As for the ‘disenchantment’? See Fred’ Nietzsche who had already announced the ‘death of god’ [the year Jozi came into existence, for those with an inclination for random symbolism.] before Weber wrote his book: and if god was dead where did that put protestant opinion on frugality and other penny pinching platitudes which were ideas rooted in [an alleged] god’s alleged message, to approach debt management as a “calling”.

      Well we know where it went…

    • Richard H

      See below my response to this qfrom GenaSap above: “This means that we are no longer in a ‘Capitailst’ world such as Weber described, because we understand that the idea of duty, of behaving according to one’s word, are oddly old fashioned and hustling people out of their money is de rigeur …”

      The emerging ethos of corporate social responsibility (CSR) requires thinking beyond shareholders’ needs (to maximise profit) to also making a positive contribution to stakeholders in society, as the corporation’s social licence to operate.

    • http://paulwhelanwriting.blogspot.com Paul Whelan

      This is a well-trodden path showing again the fallacy of the single cause.

      It must be remembered the majority of those who took ship to the Americas were dissidents, non-conformists whose view of the world – and the world to come – was that it was one’s duty (and also prudent) to be about God’s business, not idling about indulging the 7 Deadly Sins, which was said to have become the norm of the priestly and noble estates before the Reformation. The emigrants were in every sense outcasts of existing society, excluded from any chance of material or spiritual fulfilment there.

      Inevitably being industrious and doing your duty by God meant you would make more ‘money’ in a new land, however wealth was measured, and the well-to-do Puritan’s ‘duty’ in early settlements included being charitable, not just acqusitive. This he was expected to demonstrate before a critical and watchful Congregation.

      Mr Weber might have considered also that he saw the ‘spirit of capitalism’ in New England before it became the ‘established economic order’ simply because ‘the spirit of capitalism’ is innate: it is a pervasive trait, common to humankind, if not quite universal. Intriguing exceptions in remote Pacific island communities must not be taken to undo a general rule.

      The reason Catholics took offence at Mr Weber’s thesis is also simple: it isn’t true either. Catholics conquered the Americas long before ‘protestant’ settlements were taken to indicate unique ownership…

    • http://paulwhelanwriting.blogspot.com Paul Whelan

      .. of a capitalist spirit.

    • http://nicholasjakari.com GenaSap…

      @Richard H The emerging ethos of CSR, to which you refer is [at best] simply an additional tool to further shareholder interests, in the sense that profitability is more than ever beholden to “The Naked [ness of the] Brand”. To the extent that it isn’t that then to that extent will the business decline See Blackberry f.i. Possibly: social media power is replacing the “protestant ethic”

      And then: Satisfying a market need in a way that maximises the owner’s return [read shareholder's return]on effort expended is the only reason the business exists Richard… when it ceases to do that, is when it’s ‘social licence[whatever] to operate” runs out. The business will either be taken over by a nimbler competitor, or go into receivership.

      So for instance of the 100 Corporations that made the early “Forbes Top Hundred’ list more than a century ago only one still exists. The rest lost sight of the elementary rule and went… the most recent being Kodak.

      Right now There is a probability that recent giants like Nokia, Blackberry, Nintendo, Sony, Canon et al, et al: will struggle to survive; as are London/New York/big city/ taxi drivers, facing the new ‘lift schemeApp':”UBER revolution, that they believe wlll put them all out of business.

      This is not to suggest that a business cannot perform useful social function while satisfying a market need: the Quaker inspired Cadbury Schweppes Co’ being an obvious example: with a fat takeover sign on their forehead.

    • http://nicholasjakari.com GenaSap…

      @Richard H [again]

      Ironically i notice that the headline story in today’s “Business Report” “PIC is not guided by politics”, rather it is “informed” by these. This apparently in response to shareholder [read investor] anxiety that their [PIC's] pursuit of socially relevant investment options was yielding less than “optimum returns” [BR 4/8/14 byline: Wiseman Khuzwayo].

      They are referring to a little understood concept known as “Opportunity Cost”: that is how one measures the idea of Maximising profitability.

    • http://nicholasjakari.com GenaSap…

      @Paul Whelan

      There are many different ways indeed Paul over and above your restatement of the
      Weber premise with Quakers added and then mysteriously ascribing that as an alternate ’cause’.

      It could,for instance, be argued that the long term success of the USA, Britain, the Scandinavia’s, the NorthEuropeans, The Chinese [Being a surplus creditor nation is a normal position for China from way back before JC] and of course Japan and even Korea had everything to do with their inclement climate: while those Catholics, to whom you refer as ‘having conquered the America’s before the [so-called] Puritans, ended up mostly in warm places where armies of slaves could be kept working 12 months per year on vast estates… that were often owned by absentee landlords [emphasis on LORDS].

      By contrast inclement places logically are slave unfriendly [what do you do with them when it snows] therefore freedom was encouraged and land holding became widespread.

      Then the dour religious background is, in its ethical precepts comparable to the ethical teachings of Confucius… albeit they are quite dissimilar… and both have contributed to the successful societies of which they are part.

      Extractive structures tend to be historically less successful than Inclusive ones [witness the current dilemma over E'tolls]. That the less successful seemed to be predominantly Catholic, was more of a structural inevitability than any comment on moral worth… All causes.

    • Sheldon Jennings

      Hi Bert. This is a talk I found revealing and I though you and your fellow bloggers might appreciate it.

      https://www.ted.com/talks/nick_hanauer_beware_fellow_plutocrats_the_pitchforks_are_coming