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There is only one goal. That is to be whole again.

There is only one goal. That is to be whole again. How human beings live and work determines whether they remain whole or are split. ...


Gandhiji wrote

The unity of all life is a particularity of Hinduism which confines salvation not to human beings alone but says that it is possible for all God's creatures. It may be that it is not possible, save through the human form, but that does not make man the lord of creation. It makes him the servant of God's creation.

Here Gandhiji sets the first task of a developing Gandhian economics: Develop an economics that treats all of creation as not only the means but also the ends. Gandhiji continues in the same essay

Now when we talk of brotherhood of man, we stop there, and feel that all other life is there for man to exploit for his own purposes. But Hinduism excludes all exploitation. There is no limit whatsoever to the measure of sacrifice that one may make in order to realize this oneness with all life, but certainly the immensity of the ideal sets a limit to your wants.

Gandhiji hints here that a Gandhian economics would begin with the limiting of wants. He continues

That you will see is the antithesis of the position of the modern civilization which says: 'increase your wants.' Those who hold that belief think that increase of wants means an increase of knowledge whereby you understand the Infinite better. On the contrary Hinduism rules out indulgence and multiplication of wants as these hamper one's growth to the ultimate identity with the Universal Self.*

Gandhian economics may then be defined as the study of how to use our abundant resources to limit our wants and satisfy them over time in a way that enriches both our resources and our selves making self-realization possible for all.

*Harijan, 26-12-'36, p 363-364 (From weekly letters from Gandhiji).


Ahimsa is the law of nonviolence. Gandhiji's practice of satyagraha, or truth-force, was built on this idea of ahimsa. What confuses the student of Gandhian economics is how the idea of karma is to be reconciled with the idea of ahimsa.

Karma is seen by many as a law that teaches an eye for an eye. It has been compared to Newton's laws. The idea seems to be a quaint one: a violator will be violated, a thief stolen from. That is a common, though violent and misinformed idea of karma.

Karma is seen from a more accurate and enlightened perspective as a repayment of rna, or debts. Someone does something to you, let us say steals from you. In doing so they are simply repaying past rna. With that act, the olds debts have been paid and you are now free as long as you do not respond to the act by creating a fresh act. Governments, companies, and people get entangled in ever increasing violence by being reactive and recreating new karmas that are then acted out and reacted out infinitely.

The key to understanding karma is this. What someone does to us, an act, has no power whatsoever on our essence or higher self. It is only with our ego-identification with the act that the debt created by the act, rna, turns into rnanubandhana, or debt-bondage.

Ahimsa, the law of nonviolence, is the only reliable way to end karmic ties with what is undesirable. For once we have paid our debts we are free!
In 1978 E. F. Schumacher, perhaps the 20th century’s most celebrated humanist-economist (author of Small is Beautiful), acknowledged his debt to Gandhiji and called the Mahatma one of the truly great economists and prophesized that one day Gandhiji may be remembered as the greatest economist of all.


Life is violent. Humans are violent. When we talk about nonviolence we are not using it as a descriptive term. We must accept the violence inherent in life. Gandhiji called this sat, a Sanskrit word which means the way things are.

Nonviolence then is our response to sat. We accept that violence is part of our nature and pure nonviolence is impossible. But we also accept that violence is not the entirety of our nature. There is more to us than that. That nonviolent part of us makes a nonviolence response to sat possible.

Pure materialism based on self-interest is pure violence. Yet we must accept that as part of life. So the entire system of classical economics from Adam Smith onwards all the way to the present is not so much wrong as it is limited. Human beings are capable of behaving like profit-seeking selfish calculators, inflicting great violence upon themselves and the environment. However that is not all humans are capable of. Human beings are capable of thought, of contemplation, of transcending the violence of economic life and choosing a nonviolent response.

This nonviolence is what is emerging as Gandhian economics.


Gandhiji gave us a simple criterion with which to evaluate economic theory and policy: are means and ends interchangeable?* In the period before Adam Smith all the way back to Aristotle the preoccupation of economic thinkers was with right economic conduct and the fair prices that would result from it. Here means and ends were undoubtedly not only connected but also interchangeable.

With Adam Smith came the focus on self-interest as the means and a prosperous society as the end. With Smith onwards economic thinking suffers from this inconsistency between means and ends. After all how can pure greed and selfish behavior lead to anything other than a greedy and selfish society? Smith's book was called the Wealth of Nations but really is a system for creating a few fabulously wealthy individuals in a morally broken society.

The other so-called revolution in economics is Keynesian economics. John Maynard Keynes proposed a system of deficit spending during times of critical economic crises to rescue the system. Here the distance between means and ends is compounded! First we must accept a corrupt system based on self-interest (Smith). Secondly, we must accept that such a system must periodically crash and cause untold suffering. Hence we must mortgage our future to save the system (Keynes).

Using Gandhiji's simple criterion we must reject both Smith's classical economics as well as Keynesian economics unless our human imagination is limited to imagining only selfishness and overspending as our ends.

*Young India, 31-12-1931, reprinted in M.K. Gandhi, The Essence of Hinduism. Delhi: Farsight, 2009, p 67.