Dharma Revolution: An interview with Sri Dharma Pravartaka Acharya (Part One)

The Dharma Manifesto by Sri Dharma Pravartaka Acharya is a “blueprint” for creating a new type of society based on the ancient spiritual principles. At its core is to restore the sacred to the ordinary and dignity to the individual so that each person might fulfill their full potential. Below is the first of a two-part interview exploring Sri Dharma Pravartaka Acharya’s life, work, the principles and purpose of The Dharma Manifesto, and his vision for a new, very different, and Dharmic politics and nation state.

About Sri Dharma Pravartaka Acharya:

Sri Dharma Pravartaka Acharya has been a follower of Sanatana Dharma (“Hinduism”) for four decades, and has been a recognized teacher in the tradition since 1988. He holds a doctorate in Religious Studies from the University of Wisconsin at Madison, and is the founder, head, and guide of the global Dharma Nation movement. He also lectures and writes on the Dharma. His other books include The Shakti Principle: Encountering the Feminine Power of God and Sanatana Dharma: The Eternal Natural Way.

The Dharma Manifesto: An interview with Sri Dharma Pravartaka Acharya (Part Two)

The global rise of Dharma, the future Dharmic nation state, and the thousand-year war against Hinduism. These are just a few of the subjects Sri Dharma Pravartaka Acharya (an ordained orthodox Vedic brahmana, and author of The Dharma Manifesto) discusses in this, the second part of a two-part interview with People of Shambhala. We hope you enjoy.

About Sri Dharma Pravartaka Acharya:

Author David Frawley has said of Sri Acharyaji, that he “represents the Sankalpa [the will] of the Hindu people and the cause of Sanatana Dharma.” He has been a follower of Sanatana Dharma (“Hinduism”) for four decades, and has been a recognized teacher in the tradition since 1988. Sri Acharyaji holds a doctorate in Religious Studies from the University of Wisconsin at Madison, and is the founder, head, and guide of the global Dharma Nation movement. He also lectures and writes on the Dharma. His other books include The Shakti Principle: Encountering the Feminine Power of God and Sanatana Dharma: The Eternal Natural Way.

A Vedic Critique of Marxism

A Vedic Critique of Marxism
By Sri Dharma Pravartaka Acharya

Indian Marxist
The following article is from chapter 3 of the groundbreaking new book “The Dharma Manifesto“, by Sri Dharma Pravartaka Acharya. This paper represents the first seriously philosophical, Vedic critique of Marxism ever written in history. The book can be purchased at:



If you can cut the people off from their history, then they can be easily persuaded.”

– Karl Marx (1818-1883)

Marxism is arguably the most monstrously destructive and morally reprehensible worldview the world has ever known. The perpetual violence that has been instigated by Marxist movements, totalitarian Communist dictatorships, bloody guerrilla wars, and terrorist bloodshed has been responsible for more deaths and suffering during the twentieth century than any other rival ideology of that era, including National Socialism. Marxism has led to the destruction of cultures, the dehumanization and misery of large segments of the global population, and the degeneration of the human spirit. Marxism is an atheistic and materialistic philosophy that views human beings as purely mechanistic, characterless and utilitarian automatons. For Marxists, human persons are to be reduced, both philosophically and in practice, to nothing more than soulless and bland laborers, whose existence only has meaning in direct proportion to their degree of utility by, and enslavement to, the state.

Karl Marx (1818-1883) was a German citizen of Jewish descent who in his youth had been interested in the views of the German idealist philosopher and theologian Georg Wilhelm Friedrich Hegel (1770-1831). Though Hegel’s philosophical system was theistic, and most of his followers at that time were themselves primarily religious individuals, Marx’s introduction to Hegel’s thought was via the Young Hegelians, a group dedicated to misusing Hegel’s philosophical methods to undermine and eradicate religious thought itself, rather than uphold it. The two main leaders of the Young Hegelians were Ludwig Feuerbach (1804-1872) and Bruno Bauer (1809-1882).

Karl Marx had initially (pre-1844) subscribed to the Feuerbachian program of the critique of religion. While he continued to employ the notion of a philosophical anthropology – the attempt to discern the human meaning behind every experience – he went further than LudwigFeuerbach with his attempt to perform a critique of political economy. In the following section, we will briefly examine what led Marx to attempt such a critique, and talk about the ways in which political economy is thoroughly resistant to such a Marxist critique.

Fueurbach and the Young Hegelians felt that the very apex of both the philosophical and the theological enterprises had been achieved by Hegelianism and German Lutheranism, respectively. Thus, in their monumentally insular view, the end of the philosophic enterprise had suddenly commenced in their lifetime.[1] Now, the only project left was the creation of a philosophical anthropology – an attempt to show that all philosophical ideas were dependent upon what is essentially human in the purely biologically behavioral sense. Once a general account of humanity would be attained, so their belief went, then such an account could be applied to all things. The primary tool of this project was the use of the process of criticism, which would purportedly reveal the conditions for the very possibility of any object under observation.

The Young Hegelians, including Feuerbach and Marx, had applied this process of critique to the nature of the theology of the so-called Right Hegelians, who were primarily Lutheran theologians loyal to Hegel’s theistic philosophical underpinnings. Feuerbach, specifically, felt that religion was merely an unreal projection of essential, alienated humanity. Furthermore, for Feuerbach, God was no more than the construction of human beings, and actually represented the conceptual personification of what were in actuality very human traits. By critiquing God and religion, Feuerbach thought, a greater knowledge of human beings could be attained. Marx would later fervently agree with this general premise.

While Feuerbach felt that there was at least a trans-historical human essence, however, Marx felt that such an idea was too much of a concession to the “metaphysical”, and that man’s essence was only ever revealed under real world, materialist conditions. Human beings, for Marx, are in essence, primordially, producers and makers. Work, for Marx, was both the raison d’être and essential attributive nature of the human person. Therefore, on Marx’s account, self-actualization consisted in nothing more than having the freedom to perform meaningful work. Production, for Marx, was labor that is transformative towards creating a certain outcome, a praxis. Political economy was a body of theories formulated by the classical economists (such as Adam Smith) that sees human beings as essentially productive animals. Therefore, political economy – the realm of production and exchange – now became the central object of any Marxist critique.

The French Revolution supposedly succeeded in creating political emancipation, so Marx insisted, but state equality displaced inequality into the social sphere. In the social sphere, human beings were subject to an overwhelming sense of alienation. The proletariat (the working class) was separated from what they essentially are – biologically-determined producers unleashed to create, as an expression of their own essence. Political economy was thus seen as nothing more than the projection of our collective human praxis.  Instead of political economy serving human purposes, however, Marx felt that humanity was presently serving the needs of political economy. But the present political economy is nothing more than our own creation. Now a human revolution was needed. In order to begin this purportedly emancipatory process, Marx felt that the economic system of his time needed to be translated into a philosophical anthropology.

Marx’s attempt to translate the critical program to political economy proved immediately problematic for three reasons. 1) While God is immaterial, economies are very material; 2) It was impossible at Marx’s juncture in history to imagine a world without alienated labor; 3) Marx used Adam Smith as his primary economic theorist, though many of Smith’s ideas no longer applied.

Thus, while Marx made the attempt to translate Fueurbach’s failed critique of religion into a critique of political economy, such an application was itself a complete failure, to say the least.

The Failures of Marxism

We are ruthless and ask no quarter from you. When our turn comes we shall not disguise our terrorism.”[2] – Karl Marx

The failures of Marxism are legion and have been well documented for many decades by a wide variety of scholars, researchers, thinkers, economists and political scientists. Marxism eliminates all incentive for people to engage in any form of labor, whether intellectual, artistic or physical. By eliminating wages directly reflective of the value of individual instances of labor, people living under Marxist regimes are forced to work for a rationed amount of food and basic resources. Without a fair wage to work for, people naturally lose the motivation to work at all, thus leading to economic stagnation and a sense of hopelessness. We have seen such instances of economic failure in every Communist nation in history, and we are now beginning to see such economic breakdown occur in Europe and America as a direct result of the incremental introduction of crypto-Marxist economic policies.

A nation under the bondage of Marxism is destined to failure because such a state provides its people with no reason to strive for anything higher than being a personless atom in the social mass. With no distinctions, diversity, hierarchy, or classes to order the varying social strata of society in a sane and reasonable manner, a doctor will be paid the same wage as garbage collector, and a factory laborer has no hopes of ever earning a better life even if he acquired a Ph.D. All people are paid equally for work that requires unequal levels of skill, talent, education and personal natural propensity, so the person who aspires to be a doctor has no motivation to go to school for so many years of hard work only to be paid the same amount as someone who has not gone to school at all.

Marxism is predicated upon the idea of radical egalitarianism. Consequently, Marxists strive to utterly eliminate any sense of ethnic and national diversity, pride or celebration. The policy of eliminating a people’s natural and inherent sense of distinct cultural identity is designed to deprive people of any identity-sourced empowerment to dissent against the totalitarian, atheistic government. It is precisely for this reason that we must hold on to our ethnic and cultural identity at all costs, expressing a healthy pride in who we are, and in the ethnic heritage that made us who we are. Marxists, both those who have already gained power and those who seek to force their way to power in non-Marxist societies, promote and force ethnic amalgamation at the direct expense of ethnic diversity, often in the very name of ethnic diversity. We must never allow any government to eliminate the rich and beautiful diversity of the many cultures, languages, ethnicities, races and unique peoples that make our world the fascinating and meaningful place it is.

Marxism enforces its own beliefs and forcefully prevents all free speech that departs from their own belief system. Marxism is based upon fanaticism, hatred, doctrinaire closed-mindedness, dogmatic slogans, and blind faith in unsound historical, social and economic theories. Those found dissenting against the Marxist system are taken from their families and put into re-education centers or Gulags for merciless and systematic brainwashing. Those who continue to dissent are often summarily executed, with the family expected to pay for the bullets. The nightmarish Marxist model of the state represents the very opposite model that is presented by Dharma.

Comparison of Marxism with Sanatana Dharma
(Please compare both lists side by side)



Biological Determinism.

External environment creates human essence.

Nurture trumps Nature.


Radical egalitarianism.


Class, gender, race and social conflict.


Ethnic disintegration.

Eradication of gender differences.

Destruction of Tradition.

Culture reflects the lowest common denominator.

“Socialist realist” art.

Destruction of the family structure.

Exploitation of Nature, and degradation of the environment.

Relativist ethics (the ends justify the means).

Lack of civil freedoms.

Personhood subsumed in the amorphous masses.

Democratic centralism.


Abortion on demand.

All means of production controlled by the state.




Human beings create their external environment, which in turn can have an effect
upon the natural development of the person.

Will trumps both Nature and Nurture.


Qualitative Hierarchy.


Class, gender, and social harmony and cooperation.

Ethnic Plurality.

Ethnic integrity.

Celebration of gender distinctions.

Celebrating Tradition.

Culture reflects the highest ideals.

Aesthetics inspired by ideal forms, transcendent insight, eternal archetypes,
and inspiration from Nature.

Upholding the traditional family.

Preservation and reverence for Nature.

Firm non-relativist ethics.

Human values based upon transcendent truth.

Inherent freedom of the human person.

Human personality never subsumed in the amorphous masses.

Leadership principle.


Respect for innocent life.

All means of production controlled by free and creative human persons and

Marxist philosophy, and the Communist movement in general, is without doubt the most destructive ideology humanity has ever been subjected to. Marxism represents the exact antithesis of Natural Law, of religion, of positive culture, of any form of national ideal, and of healthy tradition. Marxism is the polar opposite of life itself. It is the embodiment of the final, quintessential stage of the 4000-year-old failed Abrahamic experiment.

Communism has been responsible for the death, murder, torture and pain of more human beings than any ideology in world history (with, arguably, the possible exception of Islam). In China, the former USSR, and the former Communist nations of Eastern Europe, it has led to environmental degradation that is unprecedented. Marxism is a culture-destroyer. Far from being “progressive” and leading societies toward greater advancement, Marxism has led the nations under its rule back to the dark ages. In each and every significant way, Marxism is the very exact opposite of everything that Dharma and Natural Law has ever stood for. This explains why for the last 150 years of history, communists have been one of Vedic civilization’s very greatest enemies, and have tried to destroy us every chance they get. Marxism is the natural enemy of Dharma. Every follower of Sanatana Dharma must oppose Marxist materialism with every breath we have.


This article is the most in-depth critical analysis of Marxism from a Vedic perspective ever written. It is taken from chapter 3 of the groundbreaking new book “The Dharma Manifesto“, by Sri Dharma Pravartaka Acharya.  The book can be purchased at:


The Dharma Manifesto serves as the first ever, systematic revolutionary blueprint for the nascent global Vedic movement that will, in the very near future, arise to change the course of world history for the betterment of all living beings. The Dharma Manifesto signals the beginning of a wholly new era in humanity’s eternal yearning for meaningful freedom and happiness.


About the Author

Sri Dharma Pravartaka Acharya has been acknowledged by many Hindu leaders throughout the world to be one of the most revolutionary and visionary Vedic spiritual masters on the Earth today.

With a forty year history of intensely practicing the spiritual disciplines of Yoga, and with a Ph.D. in Religious Studies, Sri Acharyaji is one of the most eminently qualified authorities on Vedic philosophy, culture and spirituality.

He is the Director of the Center for the Study of Dharma and Civilization – the very first Hindu think tank in American history.

His most historically groundbreaking politico-philosophical work, “The Dharma Manifesto”, is now offered to the world at a time when its people are most desperately crying out for fundamental change. Available here:




[1] Which was, on the face of it, merely another ego-driven manifestation of what I have termed the psychological defect of temporal-centrism – or, believing that the historical era in which one is presently living represents the apex of all human achievement.

[2] Neue Rheinische Zeitung (May 18, 1849) ”Marx-Engels Gesamt-Ausgabe, Vol. VI, p. 503.

A Vedic Examination of Abrahamism

The following article is from chapter 3 of the groundbreaking new work The Dharma Manifesto“, by Sri Dharma Pravartaka Acharya.

A Vedic Examination of Abrahamism

By Sri Dharma Pravartaka Acharya

The Abrahamic worldview is today represented by five closely aligned ideological tendencies: 1) Judaism, 2) Pauline Christianity, 3) Islam, 4) Marxism, and to a less significant extent 5) the Baha’i movement. Of these Abrahamic tendencies, Marxism is the only self-stated atheistic one, the others being religious in nature. The greatest real-world challenge and exact philosophical juxtaposition to the entire Dharmic worldview has historically been, and continues to this day to be, the Abrahamic mentality and worldview.

While some very important theological and ritual distinctions can be seen between them all, nonetheless the specifically religious-oriented aspects of Abrahamism – Judaism, Christianity and Islam – share a common worldview, psychological make-up, and guiding ethos. Judaism, Christianity and Islam are historically referred to as the “Abrahamic” religions because all three religions trace their origins to the prophet Abraham, and can thus be seen to be quite similar in many aspects of their respective outlooks. The following are only a few of the similarities that they all share.

1. All three religions have a shared acceptance of the teachings of the Old Testament prophets (Christianity, in addition to the accepting the Old Testament prophets, also accepts Jesus. Islam, in addition to the Old Testament prophets and Jesus, also accepts Muhammad).

2. Anthropomorphic monotheism. The supreme god of Abrahamism is seen in very human terms, including in his exhibition of such very human emotions as anger, jealousy, prejudice and vengeance.

3. A profound sense of religious exclusivity, creating two strictly delineated camps of “believers” in opposition to everyone else.

4. The belief that there is only the sole true faith, and that any other form of religious expression external to the “one true faith” is necessarily wrong.

5. The acceptance of terrorism, violence, mob action, looting and aggressive missionary tactics to spread their religion.

6. A common sense of being at a war to the death with the Dharmic (“Pagan”) world that preceded Abrahamic ascendency.

7. The centrality of unidirectional prayer to commune with their god, with systematic meditation practice playing either little or no part in the practice of their respective religions.

8. A belief in the existence of angels, the devil, demonic spirits, etc.

9. All three teach the bodily resurrection, the Final Judgment, the creation of the soul at the time of conception or birth (as opposed to the soul’s pre-existence, which all Dharmic spiritual traditions teach), the binding effects of sin, etc.

10. The importance of a specific holy day of the week set aside for prayer and rest: For Jews – Saturday. For most Christians – Sunday. For Muslims – Friday.

These are only a few of the elements of the Abrahamic worldview, of which mainstream Christianity is an integral part.

Up until 2000 years ago, the Dharmic worldview was by far the predominant worldview for most of humanity – from Ireland in the West to the Philippines in the East. Though there were thousands of diverse individual cultures, languages, foods, customs and traditions among the ancient Indo-European peoples, most of these ethnically varied cultures were united in their deep respect for, and attempted adherence to, the Natural Way (Dharma).

This ancient uniformity in adherence to Dharma was the case for tens of thousands of years until the radically anti-human and anti-nature Abrahamic ideology suddenly burst upon the world scene 4000 years ago with an evangelical fury, religiously-inspired violence, and zealous civilization-destroying vengeance the likes of which the civilized world had never seen previously. Never before had the multiple ancient and noble pre-Christian cultures of the world ever experienced such massive destruction, death, persecution, forced conversion, and cultural annihilation performed in the name of an artificially expansive religion as it witnessed at the hands of the new Abrahamic ideology that had arrived, seemingly out of nowhere, onto the world stage. It was in the wake of this never before experienced juggernaut of Biblically inspired destruction that the light of Dharma began to swiftly wane, and that Reality as it was known up till then was turned literally on its head.

Religiously inspired imperialism began with the more localized expansion of the Israelites in the Levant region two thousand years before the birth of Christianity.[1] However, it was soon after the appropriation of the original teachings and spiritual movement of Jesus, and the massive expanse of this later, corrupt form of post-Constantine Christianity, that the expansion of the Abrahamic ideology began to take on truly global proportions. As the French thinker Alain de Benoist explains this catastrophe in the context of European history,

“. . . the conversion of Europe to Christianity and the more or less complete integration of the European mind into the Christian mentality, was one of the most catastrophic events in world history – a catastrophe in the proper sense of the word…”[2]

With the ascent of the Abrahamic onslaught came the counter-proportional descent of the Indo-European world’s traditional Dharmic civilizations.

Christianity, in retrospect, was but one of several artificially constructed, new movements that all fall under the general term “Abrahamic”, named after the infamous founder of fanatical religious exclusivity, Abraham (1812 BC – 1637 BC).  These four anti-nature ideologies are 1) Judaism, 2) Christianity, 3) Islam, and 4) Marxism.  Whether we speak of Judeo-Christian “holy wars” and Inquisitions, or the bloody and unending Islamic jihads against “infidels”, or the genocide of over 100 million people in the name of Marxist revolution, all four of these Abrahamic movements have been responsible for more destruction, loss of life, and social mayhem than all other ideas, religions, and ideologies in world history combined.

The Abrahamic onslaught has been an unparalleled juggernaut of death. More, while all four ideologies have remained seemingly divided by dogmatic, sectarian concerns, all Abrahamic movements have been fanatically united in both their common origin, and in their shared aim of annihilating their perceived enemy of Dharma from the earth, and seeking sole domination of world power for themselves alone. While Judaism, Christianity and Islam have been at war with each other for millennia, they are all united in their insistence that Dharma is their principal hated enemy. The essential driving principle of Abrahamism is to bring about the immediate death of Dharma.

Dharma and Abrahamism are exact opposites in every way.  Dharma and Abrahamism stand for two radically opposed visions for humanity’s future. Dharma stands for nature, peace, diversity, and reason. Abrahamism stands for artificiality, war, uniformity, and fanaticism. They are the only two real ideological poles of any true significance in the last two-thousand years. There has been an ongoing Two-Thousand Year War between these two opposing worldviews that has shaped the course of much of human history since this conflict’s start. Every philosophical construct, religious denomination, political ideology and general worldview of the past two millennia falls squarely into one camp or the other. Every human being living today falls squarely into one camp or the other. Dharma and Abrahamism are the only two meaningful ideological choices for humanity today. And for all too much of the duration of this Two-Thousand Year War, Dharma has been on the losing end as Abrahamism has continuously succeeded in its unrivalled ascendancy.

The destructive ascendancy of Abrahamism is, however, about to come to an end. We are now about to witness a period of Dharmodaya – of Dharma ascending – in this very generation. As is explained in thorough detail in the two books “The Dharma Manifesto” and “Sanatana Dharma: The Eternal Natural Way”, we are about to experience the rebirth of Dharmic and Vedic civilization throughout the totality of our world.

The Dharma world-view represents a positive moral and philosophical alternative to the many ills and cultural distortions of Abrahamic modernity. Vedic culture is human culture, because Vedic culture is the model of spiritual civilization. Our world is not without meaning. Our future is not without hope. Though the darkness of the Kali Yuga (our current “Age of Conflict”) and a civilizational crisis has now descended upon us, the Sun of Dharma will soon be seen again. No cloud can obscure our vision of the Sun forever. We will live to see Dharma triumphant again, and to see a Golden Age of compassion, true culture, and the Natural Way be firmly established.

[1] One of the prime example of such Abrahamist expansion was the conquest of Canaan (circa 1400-1350 BC), described in the Book of Joshua and the first chapter of Judges.

[2] Alain de Benoist, On Being a Pagan, ed. Greg Johnson, trans. Jon Graham (Atlanta: Ultra, 2004), p. 5.


This article is from chapter 3 of the groundbreaking new political work “The Dharma Manifesto“, by Sri Dharma Pravartaka Acharya. It can be found in full at the website of the Center for the Study of Dharma and Civilization, America’s first and foremost Hindu think tank.


The Dharma Manifesto serves as the first ever systematic revolutionary blueprint for the nascent global Vedic movement that will, in the very near future, arise to change the course of world history for the betterment of all living beings. The Dharma Manifesto signals the beginning of a wholly new era in humanity’s eternal yearning for meaningful freedom and happiness.

About the Author

Sri Dharma Pravartaka Acharya has been acknowledged by many Hindu leaders throughout the world to be one of the most revolutionary and visionary Vedic spiritual masters on the Earth today.

With a forty year history of intensely practicing the spiritual disciplines of Yoga, and with a Ph.D. in Religious Studies, Sri Acharyaji is one of the most eminently qualified authorities on Vedic philosophy, culture and spirituality. He is the Director of the Center for the Study of Dharma and Civilization.

His most historically groundbreaking politico-philosophical work, “The Dharma Manifesto“, is now offered to the world at a time when its people are most desperately crying out for fundamental change.

Towards a Framework for a Hindu Economic Model

Towards a Framework for a Hindu Economic Model

By Lall B. Ramrattan, Ph.D., UC Berkeley Extension


This paper delineates the assumptions and basic laws of a Hindus economics system. The intention is to compare the Hindus and Capitalists systems with a view to validate their comprehensiveness. We found that the Hindu system is more encompassing by including grace and liberating efforts that can be modeled. A diagram illustrates the Hindu framework for a rudimentary system is constructed. The paper is sufficient as a foundation for a research program on the Hindu economic discipline.


When Adam Smith formulated the western economic model he leaned on moral philosophy. The sociologist Max Weber who has likened Smith moral philosophy to protestant ethics seems wanting to extend that principle to Hinduism when he wrote that “To a Christian, the official recognition of the Vedas might appear to be a “formal principle” of Hinduism in the manner of the Protestant recognition of the Bible—always with the reservation that it is the least not absolutely indispensable.” (Weber 1958, p. 27) James Mills held a contrary view, namely that “Hinduism was less favorable to human happiness than Christianity.” (Plassart 2008, p. 534) We know also, that Karl Marx, being all out materialistic, stooped so low as to deprecate the Hindu gods in his Colonial Writings. This paper presents a Hindu Economic Model that is counterfactual to the negative view such as proposed by Mills and Marx, and argue for equal vision if not a superior one to Smith’s model of capitalism.

The essence of the model is that Hindus “…belief in the intimate relationship of philosophy and life.”  (Radhakrishnan and Moore, 1957, p. xxiii) The vision of such a study is to make people free. It is a paradigm that seeks the truth to solve the problems of life. The truth is to be lived, and not just known. (Ibid, p. xxiv). In the field of truth, however, conflict and war over economic phenomenon are not excluded, for even the great war of India, Mahābhārata, was set in the field of Kurukṣetre, the field of righteousness.

The model posits a strong relationship between contemplation and action. It is in their equilibrium state that we should look for the vision of the Hindus in general and Indian in particular. “In the totality of things, equilibrium is made the sum of all disequilibria, and all partial disorders, no matter what, combine in the total order.” (Guenon, 1983, 7) Guenon locates this harmony even in the Svadharma, the true law of cast  (Ibid, p. 9) A person’s vision in term of Dharma and Karma were circumscribed around this concept of the original sacrifice. (Dasgupta 1969, p. 2) The greatest sacrifice was the act of the one (Mahā -puruṣha) creating the world (prakriti) out of sacrifices. In the beginning was darkness, and the supreme was alone. “He reflected, I am one, I will become many.” (Wilson V.2, 1976, p. 88)

The model evolved in phases: the formative period (2500-800 B.C.), the speculative period (800-400 B.C.), the epic and classical periods (400 B.C. to A.D. 600), the medieval period (A. D. 600-1800), and the modern period (1800 to present) (Kinsley 1982, 10 – 23). The Vedas, of which the Ṛgveda Veda stands out, lay the defining words of Hinduism. The Vedas expound a caste system—priest (brāhmin), warrior (kṣatriya), merchant (vaiśya), and laborer (śudra), a stage of life system—students (brahmacārin), householder (gṛhastha), forest-dweller (vānaprastha), and monks (sannyāsin), and goals of life—duties (dharma), wealth (artha), pleasure (kāma), and liberation (mokṣa).

The Hindu model has been stalled in its development by significant interruptions. The formative period was confronted by waves of Aryan invasions and natural disasters. Archeological evidence at the Mohenjo-daro  and  Harapppa mounds suggests that the pre-Vedic civilization had a developed urban culture around 1500 B. C. Apparently, the two cultures have merged their skills, the Aryans offered knowledge of horse-power, iron and the Sanskrit language, and the original inhabitants offered oxen-force, copper, and local knowledge. The meeting of the two cultures during the Vedic period laid out the moral philosophy for the development of Hindu economics. “The earth, according to the Vedas, is upheld not by the Will of God, but by truth (Satya) of which God is the supreme exponent. Similarly the Veda says that God reveals Himself through Ṛita (Eternal Order).”  (Bose 1970, 28) Vedic ethics, therefore, sits on two pillars, Satya and Ṛita. More completely, “There are two basic terms in the Vedas indicating their ethical value—Satya (truth) and Ṛita (eternal order, discipline or eternal law, goodness). It may be said that there can be no God or Goddess in the Vedas who does not represent the conceptions of Satya (truth) and Ṛita (order).” (Bose 1970, p. 27)

A firm foundation of economics of the Hindus started in the Epic Period that set the stage for the development of “…the orthodox system of Hinduism and the unorthodox system of Cārvāka, Buddhism, and Jainism—were perforce brought into clearer perspective by the construction of systematic treatises.” (Radhakrishnan and Moore 1957, p. xix). In that period, two socio-economic treatises were codifies–the Dharmaśāstras, a treatise containing moral codes, social structure, obligations, and religion practices, and the Artha-śāstra dealing with the role of the individual regarding decision making and utility.  (Ibid, 1957, p. 193)

Assumption of the Hindu Model.

A full economics model should clearly spell out assumptions, laws and predictions of economic phenomena. The following discussions are on those assumptions that are necessary to delineate an economic system. Since many views of Hinduism have developed over the years, we can only present broad outlines, steering clear of any one particular school and providing only essential discussion.

Natural Assumptions

From nature, prakṛti, we get substances, qualities, activities, inherent relations such as hand to body, universal and particulars. (Raju, 1982, p. 80) The Veda says that “Heaven and Earth bestow riches and various wealth and treasure…prosperity on all, sustainers of the region, Holy Ones and wise.” (Ṛgveda, I. 159.5; 159.1) Nature is the source of all things. (Gītā, 9.10)

As mentioned above, the objective world, prakṛti, originated from the greatest sacrifice of the great one, puruṣa. Three types of nature are discussed in the Gītā– cosmic matter, the source of all being, and māyā. (Dasgupta, 1969, p. 58) Māyā refers to mirage, dreams, Illusion, the power of Brahman, without substance, source of modification, nonbeing but dependent on being, spontaneousness,  (Ibid, pp. 90,101, 161, 170, 179, 180, 193 Māyā can take three interpretations—real for the man in the street, undeterminable by logicians, and non-existent by the followers of the scripture. (Staal, 1975, p. 94) Guṇas are qualities derived from substances. (Ibid, 1975, p. 157) The qualities are of the nature of goodness (Satva), passion (rajas), and dullness or inertia (tamas). (Radhakrishnan and Moore, 1957, p. 109) They are the modes through which work is done. (Gītā , III.27).

Nature is conceived by Sage Kapila, the author of the Sāṁkhya system of philosophy as the source of pain and pleasure. (Vidyabhusana 1971, p. 10) This might be taken as foreshadowing of the pain and pleasure calculus of Jeremy Bentham. It is said that James Mill took a more Christian than utilitarian interpretation of the Hindus. (see Plassart, 2008) The logical view of “The illustrative (prakṛti) is the mentioning of a course of action, the obstruction of which by some particular person led to bad consequences”. (Vidyabhusana 1971, p. 108). There is lingering dispute as to whether prakṛti is eternal. Some say it is eternal because it evolved into the universe. The Naiyāyikas, Indian logicians, claim only the soul and God are eternal. (Ibid, 1971, p. 363)

The natural assumption infuses order into the Hindu economic system through the orderly state of nature (Ṛta). In the Veda, natural order is maintained by Karma through sacrifices to the Gods. (Smet 1977, p. 53) Here we have concordance with classical economics and Vedic thought on the orderly nature of the universe. This is accordance Alfred Marshall idea that economics is Natura non facit saltum loosely translated to mean nature does not leap. The physicists however, have still not settled whether the nature of the universe is orderly or chaotic. The Buddhists have argued that “…in reality everything is in a flux and nothing stays the same.” (Puhakka 1975, p. 13) As part of Hinduism, Buddhism can be seen as having a more meandering schema for the attainment of Release.

The natural assumptions subsume a big-bang theory of nature within the domain of the Hindus doctrine of Kalpa, a theory of cyclical movements of creation and dissolution.  Briefly, a Kalpa has 14 Manvantara of 64,800 years each, or 1000 Mahayugas of 12,000 years each according to Vedic astrologers. During that time, the universe goes through many phases parallel to the Golden, Silver, Bronze, and Iron ages of the West, which are called Satya or Krita-Yuga, Treta- Yuga, Dvarpara- Yuga, and Kali-Yuga, respectively. Now, we are in into the seventh Manvantara of Kali-Yuga, which will cycle back to Krita-Yuga when it dissolves. (Gītā, IX. 7).

The natural assumption also provides for economies of scale considerations in Hindu economics. The economic assumption of puruṣa can be both limitless and limited. “A Thousand heads hath Puruṣa, a thousand eyes, a thousand feet…All Creatures are one-fourth of him, three fourths eternal life in heaven…With three-fourths Puruṣa went up: one fourth of him again was here. “(Ṛgveda, 10. 90. 1, 3-4). The “thousand” is variously interpreted as innumerable, and the one-fourth is a proportional limit of the power of creatures. One can read into this that the power of labor is limited, a condition for diminishing returns. Increasing returns to scale, however, can be attributed to Hindu economics as a result of the socialized feature of technological advancement, which is referred to in ancient Hindu text, and is an advent of the modern informational revolution.

There is dispute over the purpose of nature in Hindu economics.  In the Brahma Sūtras, the world is said to be created as a Līlā, meaning sport or play. (Brahma Sūtras, II. 1.33) The great Hindu books the Rāmāyaṇa and the Bhādgavata-purāṇa describe Rama Līlā and Kṛṣṇa Līlā, respectively, where the avatāras, Rama and Kṛṣṇa simply engage in amorous pastimes. The image that is painted from those pastimes is that the purpose of the world is mere sport just as a child having built a sand castle would take it down. In addition to the teaching of renunciations, this sportive idea may explain the Marshallian view as to why the Hindu doctrine does not support capital accumulation as the western doctrine. Another explanation may be that even when accumulation takes place, it is spent for God purpose. Anandagiri says that we should not raise the question as to the purpose of creation, (comment on Gītā IX,10) which allows the argument that creation might be just spontaneous and so too, economic activities.

Arguing from an identity and not say structural viewpoint, one can say that a purpose is implicit from the mere expansion of God’s energy. Earth, water fire, air, ether, mind, intelligence, ego combine to form the class of inferior energy. One can build a determinist argument on the identity premise. The superior energy is living entity, Jīva-bhūtām, which utilizes or exploits the inferior energy. (Gītā VII, 4; 5)  The inferior energy is veiled by the creative power yogamāyā, the confluence of the three guṇas. (Gītā VII, 25) But one can find also stochastic or ergodic viewpoints to complement determinism. The Śrīmad-Bhāgvatam speaks of a random process, like a log floating down a stream by chance come to rest, for the creatures coming out of the clutches of matter. (Bhāgvatam 10. 38. 5). Identity elements such as Atman is Brahma reflect national income identity concept in macro economics. The stochastic elements also have mirrors as when one can say that You = self + error. “The Vedanta recognizes no sin, it only recognizes error.” (Vivekananda, 1976, p. 295).

Psychological Assumptions

Those part of the Vedic literature that postulate a soul, argue that individuals have the propensity to better their conditions.  The psychological desire to better ones material conditions comes out clearly in this partial verse: “Like Sun and Moon may we pursue in full prosperity our path.” (Ṛgveda.V. 51.15) Again we read that “A man should think on wealth and strive to win it by adoration on the path of Order, Counsel himself with his own mental insight, and grasp still nobler vigor with his spirit.” (Ṛgveda, X. 31. 2)

Beside desire for wealth and food, people have different mental disposition in their seeking as is evident from the path of bhakti–devotion, jñāna–Knowledge, karma—action.  A person’s vision in term of Dharma and Karma were circumscribed around this concept of the original sacrifice. (Dasgupta 1969, p. 2) These mental dispositions are circumscribed by three forces of the guṇas, namely sattva—potential consciousness, rajas—source of activity, and tamas—source that resist activity. (Radhakrishnan and Moore, 1957, p. 424)

Another psychological drive is our tendency to imitate. What the leaders do, the generality of men tend follows. (Gītā III, 21) This concept is most enlightened for economic analysis in the areas of advertising, research and development, franchising, and dealership competition. Needless to mention that orthodox economic theory breaks down in its leader-follower models where the marginal curves fail to predict outcomes.

Institutional Assumptions

We now ponder the institutional Assumptions.

1. Personal Freedom

The Psyciocrats advance that notion that “…for the production of wealth free competition is the best general rule, subject to exceptions only when they can be justified. (Walras 1954, p. 397)  “The natural effort of every individual to better his own condition, when suffered to exert itself with freedom and security, is so powerful a principle, that it is alone, and without any assistance, not only capable of carrying on the society to wealth and prosperity, but of surmounting a hundred impertinent obstructions with which the folly of human laws too often encumbers its operations”. (Smith, 1776, WN, Modern Library, p. 508) Alfred Marshall spoke more broadly of Economic Freedom encompassing “…self-reliant habits, more forethought, more deliberate and free choice.” (Marshall, 1972, p. 8) Today, we think of personal freedom in terms of the economic agent being free to choose an action.

The Gītā has conditioned action on the guṇas so precisely that one is tempted to write the conditioned expectation E(Action|guṇas). In view of what is said about creative energies, we have to add also that E(Action| guṇas| Jīva-bhūtām). Or is it that E(Jīva-bhūtām | guṇas )The guṇas are the doer of action (Gītā III. 27; V. 14), and nothing is free from the guṇas, which are derived from material nature. (Gītā XVIII. 40). In keeping with modern economic thought, the guṇas may be thought of loosely as the information set that determined the action of the individual. The information set does not have the same partitioning for every individual. Each individual partitioning will be determined by the individual inborn nature, svabhāva. Each individual will conduct his/her own work, svadharma. The three guṇas—potential consciousness (sattva), source of activity (rajas), and source that resist activity (tamas) creates no action (equilibrium) when they are equipoise and creates disequilibrium (evolution) when they are disturbed. (Radhakrishnan and Moore, 1957, p. 424)

Freedom is attained when one does their appointed work “for action is better than inaction.” (Gītā, III. 8). “Even the man of knowledge acts in accordance with his own nature. Beings follow their nature. What can repression accomplish?” (Gītā, III. 33). “…no one can remain even for a moment without doing work” (Gītā, III. 5). “Thou shouldst do works also with a view to the maintenance of the world.” (Gītā, 111. 20) The two verses: “Better is one’s own law through imperfectly carried out than the law of another carried out perfectly. (Gītā, III. 35)

Actions comes under the influences of the gunas. One mudhra has it that the gunas—, tamasic, sattwic,  and rajastic are like the little, ring, and index finger, respectively. The ring finger can be bent toward the index one signifying phlontrophic activities like a Bill Gate, Warren Buffet, or Ted Turn giving away lots of their money for the good of people. It can be bent toward the little finger, signifiying all attachment to the fruits of ones work. The middle finger can stand equipoised with only self reflection, then no work will be done. Swamin Vivekananada of the Ramakrishna order advocate keeping some ego in order to continue the work of the world. One thing is clear, though, Karma becomes a path to liberation only if it is done as karma yoga.

2. Contractural Relations

Man has an implicit contract to work. Even God abides by this contract: “If I shold cease to work, these worlds would fall in ruin” (Gītā III, 24). In worship, the hindus make a contract with God by stating the purpose of the worship (Sankalp) upfront. But there is somewhat of an explicit contract (Gītā IV,13) which speaks of the four orders (cāturvarṇaṁ) created by the Lord. Most interpreters say that this social order system is driven by the modes of material nature and action, and not birth. The proof of this is inherent in the argument that the the trancendence of the guṇas leads each of the four order back to their true self.

Contractual relations also speaks to the distribution of wealth. The Veda states in effect one receives more in wealth and kind that one give. (Rig 10.107.8). Mankind must acquire wealth with 100 hands, but distrubte it with 1,000 hands. (Arth Veda 5.24.5). But the rulers of the state is charged with monitoring the equitable distribution. The rulers distribute land, wealth, necessities of life, equitably, seeing that no one is below the poverty line, or those properties get accumulated in the hands of misers. (Rig 1.22.7; 1.81.6, and 2.3.2)

3. Private Property

Even in western economic fundamental text, we read that “Property consists in fair and rational apppropriation, or rightful appropriation.” (Walras, 1969, p. 78) “Coveting the property of others, thinking in one’s heart of what is undesirable, and adherence to false (doctrines), are the three kinds of (sinful) mental action.” (Radhakrishnan and Moore, 1957, p. 173).

Prosperity = f(Peace, Industry) (Artha Sastra: Ibid., 207).

4. Inequal Distribution

In the Hindu model, distribution is basically unequal, but made equal through the desire for  attracting more wealth. The Veda recognized natural inequality: “The hands are both alike: their labour differs. The yeild of siser milch-kine is unequaly. Twin even differ in their strength and vigour: two, even kinsmen, differ in ther bounty.” (Riveda, X. 117. 9) It, however, counts on the rich giving to the poor: “Let the rich satisify the poor implorer, and bend his eye upon a longer pathway. Riches come now to one, now to another, and like the wheels of cars are ever rolling.” (Ṛgveda, X. 117. 5)

Natural inequality is made whole through not only the benevolence of the giver, but from the giver’s own regards for a better life.  A person that does not give will “…find not one to comfort him.” (Ṛgveda, X. 117. 2). When one gives, “He makes a friend of him in future troubles.” (Ibid, X. 117. 3), and “All guilt is he who eats with not partaker. “ (Ibid, X. 117. 6). Similarly, the Gītā urge us to  “…even-minded in all conditions, rejoicing in the welfare of all creatures”. (Gītā, XII, 4) But the Lord responds to people the way people approach him.” (Gītā, IV, 11)

From the “brodest and most comprehensive point of view,” distribution is discussed either collectively, or through the individual. (Walras, 1969, p. 79-9) “Let the rich satisify the poor implorer, and bend his eye upon a longer pathway. Riches come now to one, now to another, and like the wheels of cars are ever rolling.” (Ṛgveda, X. 117. 5) This latter verse underscore the view that inequality is a result of some superior force. In capatilism, this force is associted with the market, the invisible hand, or the spectatior principle. Adam Smith who father those concepts scarcely equate them with the Deity. But the Vedas repeatly demonstrate that God is the one who hold the inventory of riches, and who gives through his grace.

5. Division of Labor

Productivity is advanced by skillfulness in work, which come from division of labor. This partly achieved through imitation: “Whatsoever a great man does, the same is done by other as well. Whatever standard he sets, the world follows.” (Gītā, III. 21) It is the method of dexterity: “Thy spirit comes to thee again for wisdom, energy, and life.”  (Ṛgveda, X. 57. 4) This verse has been interpreted to the effect that “O Man, you have been given the mind for obtaining dexterity all-round for leading an active life and for contemplation of God.” (Khosla 1993, p. 46)

Division of labor is driven by the desire to control the wavering mind, and unleash it on one’s appointed tasks. For this much repetition of a task is required, which can be attained, according to the The Bhagavadgītā, by “constant practice”. (Gītā, 6. 36) It is the division of labor that seems to drive the social division of caste.

6. Free Trade

Part of a Vedic verse say “…and meet with one who give again, who knows us well and slay us not.” (Ṛgveda, V. 57. 15) Another translation is that “…we move in full cooperation in mutual give and take, without causing injury to each other and in the mutual right understanding.” (Sarasvati 1984, p. 27) Yet another translation is that “…we will associate with the liberal, the kind, the knowing. (Bose 1970,  p. 245) We recall that “…the object of relations between persons and persons is the mutual co-ordination of human destinies.” (Walras, 1969, p. 63)

There are implications in the Veda for modern trade theory. “The Atharva Veda says God is as much of the foreign (Videśya) as our own land…The Veda wants Saṁjñāna, concord (loving union), to be established not only with one’s own people, but also with foreign people—a step that, it says, will put an end to wars. (Bose 1970, p. 35) It has foreshadowed modern integrated trade theory, which presumes a world without any boundary, one that demonstrates factor price equality.

7. Factor Mobility

A world without boundary would seem to be ideal for factor mobility.  The Vedas recognized that the mobility of factors must be allowed for soldiers who are beyond the seas. (Rig 1.167.2) In the Rāmāyaṇa, we read of allies between Lord Rama and other rulers—Vibhishana and Nisada that allow trade between their kingdoms, perhaps an ideal foreshadowing of the modern Free Trade Areas in the global economies.

8. Specialization

The Veda says that “Not without toil are Gods inclined to friendship.” (Ṛig  IV. 33. 11). This idea was interpreted to mean that “Gods befriend none but him who has toiled”. (Bose 1970, p. 242)

Man as an embodied spirit, Puruṣa, can be considered as a might person, whose limbs represent the social order of society. The Veda says: “The Brāhman was his mouth, of both his arms was the Rājanya (Kṣatriya) made. His thighs became the Vaiśya, from his feet the Śūdra was produced.” (Ṛig X. 90. 12). These are today recognized as the four castes:  priest, ruler or warriors, husbandman, and laborers, respectively, people specialized in occupation driven by their modes of nature.

There is no drawback to specialization in the Hindu economics system such as the monotony of doing one task over-and-over. One can see that if one is born into an occupation that monotony may likely result. But this is not so in Hinduism. Western notion of specialization is associated with increase productivity, as is demonstrated by Adam Smith’s pin factory example, but is dragged by monotony. Hindu specialization is somewhat ratcheted up by the thought that one is doing one’s appointed duty for liberation. The western specialization is motivated by limited gains, the Hindu specialization is motivated by unlimited gains.

Laws of Hindu Doctrine

A.    Law of Sacrifice

We mention above that it is god who made the original sacrifice: Mahā -puruṣha becoming the cosmos (prakriti). Sāṁkhya, the oldest philosophy, explains that although the Puruṣa vitalizes Prakṛti with creative forces, Prakṛti is allowed independent action. The relationship is not casual—material or efficient. (Gupta 1982, p.2) Another view is that it an unconnected relationship which can be looked at ontologically, if we wish to draw out only essential relationships. (Deutsch 1979, p. 6) This sacrifice then, is not subject to the western economic law that you cannot get something for nothing. One is reminded of the logic of the very first verse of the Isvasys Upanishad: “That is Whole; this is Whole, from the Whole the whole becomes manifest. From the Whole when the whole is negated what remains is again the Whole. (IsavasYopanishad, p. 67)

At the level of the cosmos, this law became work without the expectation for a reward.

If western economics can be defined by one word, it would be “incentive”.  If Hindus economics can be defined by one world, it would be “work.” It is tempting to write an equation of their difference, namely, (I)incentive – ( R)enouncing the fruits of ones action = (K)arma yoga. Now, it becomes subtle to interpret permutations of the terms in the equation.  I – K = R can be read as benefits wiped out as karma is renunciation;  K + R = I can be read as the results of what is renounced through karma yoga is what you would get from work in western economics. Does the Gītā sanction this interpretation? The message of the Gītā according to Sri Ramakrishna is known by repeating the syllables of the word Gītā rapidly, then it becomes “Tagi Tagi”, give up, give up. To be clear, one has to add that  Sri Ramakrishna would define “incentive” in our equation as referring lust and goal (kamini Kanchan).

B.    Law of Production.

Underlying this law is the notion of Karma. From the Vedas through the Upanishads, the law moved from pure Prayer-Karma to Prayer-Karma-Jnana. (Vidyabhusana, 1971, p.2).

In the west, production is defined as the transformation of factors of production into output.  Such production presupposes a mixture of capital and labor. More capital and with same labor; same capital with more labor would be sufficient to call the law of diminishing returns into play.

In the Hindu view of economics, one cannot leave out the input of sacrifice as a factor of production.  The model posits output condition on a social division of labor and sacrifices.

The Gītā address the nature of sacrifice in Hindu economics. (Verses III.10-13) The Lord has created men and the necessaries for sacrifices. No good can come without some reciprocal relations between gods and man fostering each other. One will be steeling if one does not enter into that reciprocal relationship. When one honors that cosmic law of reciprocity, then one gets their desired enjoyment.

C.    Law of Accumulation

“That Pūṣan (the Diety) may promote the increase of our wealth, our keeper and our guard infallible for our good.” (Rig I. 89. 5)“A man should think on wealth and strive to win it by adoration on the path of Order, Counsel himself with his own mental insight, and grasp still nobler vigor with his spirit.” (Ṛig X. 31. 2).

The law of accumulation under Hindu economics forbids activities that are not conducive to it. “Play not with dice: no, cultivate thy corn-land. Enjoy the gain, and deem that wealth sufficient.” (Rig, X. 34. 13) In early western economic models of Adam Smith and David Ricardo, corn was recognized as the basic input that regulated all activities, and as late as 1960 a somewhat post-Keynesian revolution was staged on the corn-model by Pierro Sraffa. The fundamental teaching of that Rig verse cannot be underestimated.

But Hindu economics had other latent forces behind accumulation “…As virtue is the basis of wealth and as enjoyment is the end of wealth, success in achieving that kind of wealth which promotes virtue, wealth and enjoyment is termed success in all. Thus, varieties of success.” (Radhakrishnan and Moore, 1957, p. 222) This virtue is somewhat in the western system where greed is made the foundation of accumulation. “Greed, activity,  the undertaking of actions, unrest and craving—these spring up…when rajas increases.”  On the other hand, “Unillumination, inactivity, negligence and mere delusion—these arise…when dullness increases.” (Gītā, 14. 12-13)

Accumulation varies with the dominance of each of the guṇas. “The fruit of good action is said to be of the nature of “goodness” and pure; while the fruit of passion is pain, the fruit of dullness is ignorance.” (Gītā, 14. 16) “Those who are established in goodness rise upwards; the passionate remain in the middle (regions); the dull steeped in the lower occurrences of the modes sink downwards.” (Gītā, 14.18) “The faith of ever individual…is in accordance with his nature. Man is of the nature of his faith: what his faith is, that, verily, he is.” (Gītā, 17. 3)

The Model

To attempt a unification of the assumptions with the laws detailed above will bring some closure to the comparison of western and the Hindu economic model. The sketch we provide is only a first step, and would perhaps require many stumbles before it can stand on its own. But I still believe that the economic model of Hinduism is a complete thought, only it was not written down. Figure I below illustrates a glimpse of the operational mechanism of the model. The fourth quadrant represents production, deciles income distribution, consumption, and utility maximization.

1.    Consumption

A static picture of Hindus consumption pattern was expressed by Alfred Marshall as follows: “…we find people who do indeed abstain from immediate enjoyment and save up considerable sums with great self-sacrifice, but spend all their savings in lavish festivities at funerals and marriages. They make intermittent provision for the near future, but scarcely any permanent provision for the distant future: the great engineering works by which their productive resources have been so much increased, have been made chiefly with the capital of the much less self-denying race of Englishmen.” (Marshall, 1982, 187).

Quadrant III indicates pattern of consumption. Absolute and relative income hypotheses can be captured by the long run, line through the origin, and short run consumption function. Because of the nature of consumption assessed by Marshall above, the short-run function would be moving frequently to reconcile with the long-run curve, as the accumulation or de-accumulation of wealth in each interval occurs. Before the marginal revolution had happened, the Hindus spoke about changes by months, season, and days. (Rig, VI. 24. 7).

Marshall seems to be saying that the Hindus consume all their income. In this case the Marginal Propensity to consume (MPC) line should approximately coincide with the Average propensity to consume (APC) line.  To generalize Marshall’s idea then, any external technological shock to the system such as the Aryan Invasion if it happened, the Mogul Invasion, to name the two famous ones, will cause the MPC line to drift upwards, reconciling the MPC with the APC.

2.    Utility (Bliss) Maximization.

Consumption is done moderately. Overeating is not allowed from the point of view of Yoga. One can almost claim that eating is done to reproduce the body and certainly not as a tamasic activity as identified above. This is the ideal goal, but one finds the desire for abundant food and wealth throughout the scripture. Most Vedic sacrifices have food and wealth as the aim.  Following the Law of Sacrifice for food and wealth, we can then infer that some sort of maximization of utility is implied.

A utility maximization model should fit the eternal law of Dharma (Sanatan Dharma). One implication of this is that it must have a long run perspective.  The most general form for such a specification is a Ramsey type model  that does not consider “…differences between different kinds of goods and different kinds of labor, and suppose them to be expressed in term of fixed standards, so that we can speak simple of quantities of capital, consumption and labor without discussing particular forms.” (Ramsey 1928, p. 644) Such a model however, had been known to generate dynamic frontiers, which is indicated in the IV quadrant of Fig 1.

3.    Production

Production in the light of Marshall’s thought would be starving for want of capital. Its most likely form with fixed (varying) capital and varying (fixed) occupational division of labor is a diminishing return curve in the I quadrant. What is demonstrated is production with only one sector.

Production is also dependent on governance. As is recently demonstrated, good governance that liberated the Indian economy has allowed culture to survive with technology side-by-side. It has even given prominence to the idea of third world Multi-National Enterprise. India for instance had outflow of FDI in the late 1980s to N. America in engineering, consulting, software services.

Figure 1 show two representations of production functions in the first quadrant. The curved one indicates production with diminishing returns, and the straight line indicates output if proportional to capital, Y = ak, which when augmented with other inputs will display increasing returns.  With Marshall’s view that people save only to spend lavishly on customs, we cannot be sure that the saving rate is constant, and therefore, that saving is a drive of capital and output growth. (Dornbusch, et. al., 2004, p. 79).

The production function can drift upward with the advent of new Technology, and as we have said grace in Hindu economics. There have been waves of technological progress in from the early and mythical stage of Hinduism, through merchant capitalism, industrial capitalism, managerial capitalism, Fordism, Toyotaism that represent different productive efficiency. Since there is not measure for grace, it is comingled with the technology the culture has allowed. Modern western economics do not recognize grace, limiting their analysis mainly to technology and human capital as the major cause of drifts in the function.

4.    Deciles Distribution

Quadrant II indicates that the income generated from output can be put into a distribution interval–quartiles, deciles etc.  The curve represents unequal distribution in each interval, as prescribed by the unequal distribution assumption. Its slope would be flattened to a straight line as heads of states polices redistributes wealth to achieve better equality. It is explicitly stated in the Brahma Sūtras that God acts a creator and dispenser regarding the merit and demerit of the individual soul. (Brahma Sūtras II, 1.35)

The distribution curve also indicates a group concept. Member of all the cast can be found in a particular interval. In this sense, no hierarchical order over the castes is postulated. Each individual has mental disposition: Bhakti Yoga—love and devotion, Jñāna Yoga—knowledge of reality, Raja—path of mysticism, Vibhuti Yoga—path of splendor, and Karma yoga—action. (Bose 1970, Ch. I-V) The individuals can adopt a mixture of the yogic paths.

Quadrant Linkages

One is hard put to find a beginning to enter into Figure I. Karma is Anādi or beginning less. (Brahma Sūtras II, 1.36) So, an entry point is arbitrary. Quadrant IV shows a possible link for the consumption-input plane. People use their resources to attain bliss, ānanda. Many relationships can be posited for this plane, of which only a Swan-shape possibility is represented in quadrant IV. Thinking in terms of momentary changes, a balance must be struck between what a person devotes to savings and therefore capital formation, and the tradeoff drawdown from current consumption. A model of saving of this form was first developed by Ramsey (Ramsey, 1928). The prescription is to sacrifice more consumption if one is below the bliss point, and vice versa.

How time is regarded in Quadrant IV might be controversial. “What we mean by a ‘period’ in this case is not the time interval (t, t + 1) but, (t, t + dt). U(C(t))dt is then the utility associated with an instantaneous rate of consumption at t.” (Chakravarty1962, p. 340) Yet our consumption axis measure intervals with a mixture of people of various castes. Similarly, we are inferring consumption vs. interest frontier, while the positive x-axis measure inputs. We can if we like, assume that consumption and inputs are relabeled, not shown in the diagram, to allow the discussion of a consumption-interest rate frontier. The Swan-shape is interpreted with this understanding.


The model we presented combs the literature for the basic elements Hindu economics, making comparisons with the capitalist system.  We gave natural, psychological, and eight institutional assumptions which are essential pillars to build an economic system such as Adam Smith system, showing that the Hindu system has differentiated aspects in each assumption. Mostly, the difference is that the western system does not account for grace and liberation efforts toward work.

The rudimentary model we provided shows how grace along with technology lead to growth. Room for more equitable distribution that is absent in western economics is explicitly included in the Hindu model. Consumption is govern by yogic practices, and in addition to the traditional MPC and APC schedule, characterized by a Swan like feature in quadrant IV. The mode has no pretences of completeness, but makes no apologies either for the author things that the Hindus have a complete system to be written down.


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Chakravarty, S., “Optimal Savings with Finite Planning Horizon” International Economic Review, Vol. 3, No. 3 (Sep., 1962), pp. 338-355

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Dr. Ramrattan has been teaching economics at the University of Berkeley, Extension since the mid 1990s. He has a PhD in that subject from the New School University in New York. Besides economics, he was brought up as an Indian priest. Now he writes on Hinduism and Economics. He has published a paper on Hinduism and the Current Economics Crises in the American Economists (Vol. 53, No. 1, Spring 2009, pp 34-37). He has published over 75 refereed articles in professional journals. He co-authored 8 book, 6 of which were forwarded by Nobel laureates in economics. Two books are published by Cambridge Press, One by Oxford Press, and one by Plagrave, MacMillian.

He is now a collaborating editor for Handbooks on Economics for Oxford Press. So far 10 were published, and 60 are in planning stages.

The Need for a New Indic School of Thought

The Need for a New Indic School of Thought
By Dr. David Frawley

During the Eurocolonial period, Indian history and civilization were distorted to fit European perceptions. A new school of thought is needed that will see Asian history and tradition with Asian eyes and thought, beginning with India.

The “clash of civilizations”

A clash of civilizations is occurring throughout in the world today, a war of cultures at various levels in both our personal and public lives. This clash is partly because of rising historical and cultural awareness on the part of newly-independent countries, beginning with India . The Western-European/North American culture is currently predominant and is strongly, if not rudely, trying to eliminate or subordinate the rest. Yet Western civilization is spreading itself not so much by force, as in the colonial era, but by subtle new forms of social manipulation. These include control of the media and news information networks, control of the entertainment industry, domination of commercial markets, continued missionary aggressiveness by Western religions, and – as important but sometimes overlooked – control of educational institutions and curricula worldwide.

This control of education has resulted in a Western-European/North-American view of history and culture in textbooks and information sources in most countries, including India . Naturally, people educated according to Western values will function as part of Western culture, whatever may be the actual country of their birth. They will experience an alienation from their native culture in which they have not really been raised. They easily become a fifth column for the Westernisation of their culture, which also means its denigration or, at best, its commercialisation. An authentic Indian or Indic perspective, a worldview coming out of the culture of India and its particular values and perceptions, is hardly to be found, even in India . The Western school of thought is taught in India , not any Indic or Indian school of thought.

The Indic school of thought

What is the Indic school of thought, one might ask? It is not at all something new or unknown. It is the great spiritual, philosophical, scientific, artistic and cultural traditions of the subcontinent that are among the largest and oldest in the world. It is the emphasis on dharma, on karma, on pluralism and synthesis, on yoga sadhana and moksha. It is not only the tradition of ancient sages from the Vedas and Upanishads to Buddhist and Yoga traditions but also modern teachers like Sri Aurobindo and Swami Vivekananda. It is not only the vast literature of Sanskrit but also that of the regional languages and dialects of the subcontinent, most of which have older literary traditions than the languages of Europe such as English.

All major cultural debates are now framed according to Western values and perceptions, and so they will naturally serve to uphold them. The important issues of Indic civilization today are framed according to the principles or biases of the Western school of thought. These include what Indian civilization is, when India as a nation first arose, what the real history of India is, how to reform Indian society, and how India should develop in order to have its rightful place in the future world. As the debate is defined according to the approach and values of Western civilization, India does not always fare well, and India as its own independent source of civilization is seldom acknowledged. India is judged as if it should be like another USA , UK or Germany , which it can never be, nor should be. This only makes Indians feel inferior or wrong.

The Western school of thought has denigrated or overlooked the Indic school, particularly in the Indian context. For example, the Indic school has its own history sources through the Vedas, Puranas and various historical texts (Itihasas) that are quite massive and detailed and have much internal consistency. However, in writing the history of India , the Western school does not give these any place. They are dismissed as, at best, mythology and, at worst, fraud. Instead, it defines the history of India according to outside influences, as a series of invasions and borrowings mainly from the west, from cultures the West knows better and has more affinity with, which makes India seem dependent upon the West in order to advance its civilization again today.

The Western school of thought negates the relevance of the traditions of India . This is not simply because the Indic tradition is wrong, unsophisticated or irrelevant. It is because Western civilization is hegemonic, if not predatory in nature, and such ideas help promote its spread. Its information about India contains a built-in poison. It is meant to undermine the culture of the region and subordinate it to the West, however objective, scientific or modern its approach may appear to be.

When India as a nation arose is defined by the Western school as 1947, the year of independence. It founders were Nehru and Gandhi, who inherited a united region from the British, before which India was just a confused mass of local kingdoms with no national consistency. On the other hand, according to the Indic school, India or Bharat as a country arose in the Vedic era as the type of dharmic/yogic culture that has been the main characteristic of Indian civilization through history. This spiritual or yogic orientation can be found in the cultures of all the regions of India from Tamil Nadu to the Himalayas , pervading even in the folk art and folk songs of all regions, as well as “high” culture.

Western distortions and the Indian response

In the Western school of thought, an Aryan invasion or migration is used to describe the way in which ancient Vedic civilization took root in India , as if it were an alien force of intruding barbarians. In the Indic school of thought, the whole idea of an Aryan invasion/migration is a sign of ignorance. The Indic tradition arose from the rishi tradition of spiritual endeavour, characteristic of the Vedic-Sarasvati culture and related cultures, reflected in the continuity of Vedic literature from the Vedas to the Mahabharata, Buddhist and Jain literature and the Puranas, which all reflect the same principles, peoples and dynasties of kings.

In these current cultural debates, therefore, an overriding greater debate is ignored – that which takes place between the Western and the Indic schools of thought. The Western-style media and academia tries to see what is authentic in Indian civilization and finds it to be wanting, reducing it to little more than caste or superstition. This is not surprising as the Indic tradition has a different focus and values than does the Western tradition. Similarly, from the standpoint of the Indic tradition, we must question Western civilization itself. Is the Western school of thought enlightened? Is it appropriate for India? Can it understand the unique civilization of the subcontinent?

The Indic school itself is often highly critical of the Western school. For example, when asked what he thought about Western civilization, Mahatma Gandhi replied: “It would be a good idea.” What he meant was that, from the standpoint of the spiritual traditions of India , Western civilization with its materialism, aggression and dogmatism was not highly evolved. Sri Aurobindo wrote on the limitations of Western civilization, while appreciating it in certain areas.

Secular missionaries

The West similarly tries to control any debate on cultural ethics, using slogans of democracy and human rights, which are only used to intimidate weak nations and conveniently ignored relative to stronger or wealthier nations like China or Saudi Arabia . Organizations operating under the cover of human rights are among the most aggressively alienating influences today. They function like “secular missionaries”, ignoring victims of terrorism like the Hindus, while defending the “rights” of terrorist organizations against security forces that are compelled to take action against them. Meanwhile, it is the West that is selling the weapons and profiting by terrorism and civil strife throughout the world. The West originally trained many terrorist groups, such as the Taliban fighters in Afghanistan .

Such groups highlight social inequalities in India , but ignore a colonial history marked by attacks on indigenous Indic culture. The same charges of cultural backwardness have been used throughout the colonial era to undermine the native traditions of Africa , Asia and the USA , and to justify forced religious conversion and political domination, which is their real aim. Sometimes native intellectuals are taken in by these Western approaches to social issues, not realizing that they are just promoting the colonial agenda of world domination in a more covert form.

New rules of debate

Therefore, it is not enough simply to debate issues of culture, politics, or history in the existing forums in order to promote a more Indian or Hindu view. We must question the very process itself, its basis and the perspective or values behind the school of thought in which the debate occurs. What India needs is the creation of a new Indic school of thought that is dynamic and assertive in the modern global context – one that can challenge Western civilization not merely in regard to the details of history or culture, but also relative to fundamental principles of life, humanity and consciousness. This requires a revival or renaissance in the Indic tradition and its great spiritual systems of Yoga, Vedanta, Buddhism, and Jainism, and also in its political, artistic and scientific traditions. Modern science and technology can arguably be more humanely employed according to Indic or Dharmic values than according to Western religious exclusivity and commercial greed.

The world today needs a critique of “modern civilization” from an Indic or Dharmic perspective, an interpretation of capitalism, socialism, communism, Christianity and Islam from a tradition that is much older, deeper and closer to the spirit in both man and nature. These Western ideologies are failing to address the spiritual needs of humanity and are incapable of creating a world order that transcends dogmatism or exclusivism.

Those of us who are part of the Indic school of thought should emphasize such a greater debate and not get caught in the details of issues already formulated according to the biases of Western civilization. This debate should examine the right structure for society and the real forward direction for history and evolution. We must raise fundamental questions. Is the current Western materialistic view of history valid at all, or are there spiritual forces at work in the world that go beyond all these? Can we understand our history through outer approaches like archaeology, linguistics or genetics, or is a higher consciousness or more intuitive view required as well? Are the records of our ancient sages to be rejected so lightly, whenever we think they do not agree with our views?

The real issue of the Vedas, India’s oldest tradition, is not how these texts might fit into the current model of history as promoted by the Western school of thought, tracing the development of civilization through outward material advances. It is how the existence of such an ancient tradition of rishis, knowers of cosmic consciousness, shows a higher spiritual humanity from which we have arisen and whose legacy we can reclaim.

Towards a new school of thought

India needs a different type of scholarship, an Indic school of thought that has its own values, traditions and methods of reaching conclusions. Those of us who follow the Indian civilization should develop this Indic school in its own right and not merely try to justify our views in terms of the Western or European school of thought, which is hostile and radically opposed to Indic cultural tradition.

I recently raised a call for an intellectual Kshatriya in India – a new class of warrior intellectuals to defend India and its great pluralistic traditions from the onslaught of Western exclusivist approaches, whether religious, economic or political. This call fundamentally requires the creation of such a new Indic school of thought. Such a new Indic school of thought concerns not only philosophies of liberation or yoga, but Indic, Hindu and Dharmic approaches to ecology, the global marketplace, health, science, the status of women, religious freedom, in short to all the main issues in society today – and it should also look beyond these issues, which are often the issues of the Western school, to yet broader concerns. How can we integrate humanity and nature, with its underlying cosmic intelligence? How can we reclaim our spiritual heritage, as a species, that the great yogis have pointed out for us?

Such a new Indic school of thought requires new institutions to promote and embody it, or new Vedic schools. This will arise not through Indology departments in Western-style universities but through a new type of institution with its own funding and curriculum, free from manipulation by the vested interested and ideologies of the Western school and its religious, commercial and political bias.

An intellectual renaissance

The problem is that the Western school created Indian academic institutions that reflect Western values. To try to gain credibility for Indic thought in the context of European institutions, as some well-meaning Hindus are attempting, may be a helpful strategy but misses this main point. Western universities have their own agendas that they will not readily give up. They will not change simply because a few well-intentioned people and groups give them money and sponsor positions to project a more “sympathetic” picture of India and her civilization. Like a sea that salts every river that flows into it, existing trends and interests will force the people coming into them to conform to the dominant Eurocentric values that pervade these institutions. Otherwise, they cannot survive academically.

It is not on single issues that we need to make headway but on promoting the Indic tradition as a complete school of thought in itself, rather than merely as a side subject of Indological study in Western-defined academia. We must look back to such Indic models as Naimisha, Takshashila, Nalanda or Mithila, not only to their institutions, but also to the Gurukula approach and its more intimate and spiritual form of learning.

I urge the young people and the scholars of India to take up this cause. Do not try to define India in the context of civilization as defined by the West. Instead look to the great traditions of India that have their own deeper roots and use it to critique Western civilization and discover its limitations. Rather than seeking to define and control India according to Western perspectives, the West should look to India for guidance on the deeper issues of culture and spirituality. Indians, in turn, should assert their own greater traditions and not simply imitate the West or seek to justify Indian civilization from a Western perspective. True scholars of the Indic tradition need not go to Harvard or Oxford to seek credibility, rather these institutions should come to them.

About Dr. David Frawley

Dr. Frawley has a thirty-year background in natural healing, including the systems of Ayurveda, Chinese Medicine, Western Herbalism and Vedic Astrology. He has a doctor’s degree in oriental medicine (O.M.D.) from the International Institute of Chinese Medicine, Santa Fe, NM, where he taught herbal medicine for several years. He is associated with the Ashtanga Ayurveda College in Pune, India and other Ayurvedic schools in India, where he has lectured on a number of occasions. Currently he is director of the American Institute of Vedic Studies in Santa Fe, New Mexico. Dr. Frawley studied Ayurveda back in the 1980’s with world-renowned author and Ayurvedic Physician, Dr. Vasant Lad, B.A.M.S., M.A.Sc. Dr. Frawley is the author of numerous books and articles on Ayurveda and other Vedic topics. He has presented seminars at the Ayurvedic Institute for many years.

Please visit his website, The American Institute of Vedic Studies, at http://www.vedanet.com