A healthy marketplace has...
1. Right incentive structure (John 10:11).
We want to correct misaligned incentives
2. Free flow of good information (Proverbs 20:14).
We want to fix asymmetrical information (one party having more info that the other party - such as whether an item is in working condition or not)
3. Minimal impediments to bargain (Matthew 20:1-16).
We want to lower transaction costs.
4. Righteous justice system (Proverbs 13:22).
Adam Smith
- Your theology dictates your economics.
- The Reformation touched not just the church, but the marketplace.
- Magnify your "calling" (Col. 3:18-25).
Who is Adam Smith?
- One of the most critical names in economics.
- Didn't use "Capitalism".
- Seminary Student.
- Believed in 'Invisible Hand' - the mystical force that can "promote" an end which was no part of one's intention (Which as Christians, we would call Divine Providence).
Foundation for improvements:
- Division (specialization) of labor.
- Prices reflect the compensation for risk.
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