Small Is Beautiful

7 Lessons from Small Is Beautiful: Economics as if People Mattered by E.F. Schumacher 1. Human-Centered Economics Schumacher argues that economics should prioritize people over profits. He critiques the conventional model of economic growth that focuses solely on maximizing output and efficiency, emphasizing that economic systems should be designed to improve human well-being and social harmony rather than just material wealth. 2. The Importance of Scale The book teaches that "bigger is not always better." Schumacher advocates for appropriate scale in economic activities, where small-scale, local industries are often more sustainable and human-friendly than large, centralized industries. This principle encourages self-reliance and a balance between human needs and the environment. 3. Sustainable Development and Environmental Responsibility Schumacher highlights the ecological limits of unchecked economic growth and the need for sustainable practices. He was an early proponent of environmental stewardship, advocating that economic systems should respect and preserve natural resources for future generations. The lesson here is to prioritize long-term sustainability over short-term gains. 4. The Value of Non-Material Wealth In Small Is Beautiful, Schumacher stresses the importance of recognizing non-material forms of wealth, such as community, relationships, and quality of life. He challenges the idea that more consumption equates to happiness, encouraging societies to focus on what truly enriches human lives beyond materialism. 5. Technology with a Human Face Schumacher introduces the concept of "appropriate technology," meaning technology that enhances human skills and does not dehumanize workers. He argues that technology should serve human purposes and improve quality of life, not just increase production efficiency. It should be simple, accessible, and adapted to the local context. 6. Decentralization and Local Economies The book advocates for decentralization, where smaller, self-sustaining communities are encouraged. Schumacher believes that local economies are more resilient and capable of meeting the real needs of people without the negative impacts of large-scale, globalized systems. This fosters economic independence and stronger communities. 7. Ethical Economics and Moral Responsibility Schumacher's work emphasizes that economics cannot be separated from moral and ethical considerations. He calls for a shift in economic thinking that integrates values such as justice, fairness, and the well-being of all people, urging policymakers and businesses to adopt a more humane and compassionate approach to decision-making. Conclusion: Small Is Beautiful challenges the dominant economic paradigms of its time, promoting a vision of economics that values human dignity, environmental sustainability, and small-scale systems that nurture communities. Schumacher’s insights continue to inspire those seeking a more ethical, sustainable, and human-centered approach to economics and development.

"Nothing less than a full-scale assault on conventional economic wisdom." —Newsweek One the 100 most influential books published since World War II —The Times Literary Supplement Hailed as an "eco-bible" by Time magazine, E.F. Schumacher's riveting, richly researched statement on sustainability has become more relevant and vital with each year since its initial groundbreaking publication during the 1973 energy crisis. A landmark statement against "bigger is better" industrialism, Schumacher's Small Is Beautiful paved the way for twenty-first century books on environmentalism and economics, like Jeffrey Sachs's The End of Poverty, Paul Hawken's Natural Capitalism, Mohammad Yunis's Banker to the Poor, and Bill McKibben's Deep Economy. This timely reissue offers a crucial message for the modern world struggling to balance economic growth with the human costs of globalization.

The conception of economics as a free-standing, autonomous discipline and sphere of activity, and even as an end unto itself, is one of the costliest fallacies of our age. It is precisely this fallacy that this book dismantles. That economic growth should be subordinated to broader human, cultural, political and ecological concerns, and that it should serve human growth by being intelligently harnessed to fuel community-development projects (rather than having politics hijacked by economics by claiming economic growth is the end-all of politics and society), is an idea we badly need to grasp at a time in which corporations are gaining unprecedented legal rights and political power. The underlying issue here is, as he rightly points out, our culturally patterned inability (read, unwillingness) to understand issues in their true context. Anyone who has ever tried to think logically and objectively about the matter will realize that economics is a subset of ecology. Who-da-thunk it? Human economic activities occur within a context of limited natural resources, and therefore economic growth cannot mushroom unto eternity. Ignoring said context means undercutting the basis on which we stand. Action can only be appropriately deliberated within a comprehensive and profound enough understanding of its appropriate relational context. You don't need references to quaint ethical precepts that'd embarrass any self-respecting, "hard-nosed" economist in order to appreciate this as a cold, self-evident fact revealed by the unbiased use of reason. He rightly points out that we fail to introduce the true variables (limited resources) into our computations due to a perspective schewed by flawed and overly narrow preconceptions regarding which kinds of considerations are relevant. This is another illustration of one of the costliest pitfalls of human reason: the results of any act of reasoning you perform are determined by the perspectival limitations that ensue from your posited starting points. You posit the variables that you consider relevant, and reason calculates for you the best way to focalize the picture you wish to see. Unfortunately, what you don't wish to see is at least as important as what you do. Omitting an object from one's field of vision does not decrease its reality. The lapse of reasoning on this issue is borderline pathological, and far from being our chief adaptive organ, human reason is proving disastruously ill-matched to reality (a point well elaborated also in Ornstein and Ehrlich's New World, New Mind). The issue could easily be rectified by paradigmatically enforcing modes of thought and analysis that place problems in their proper, large-scale context, instead of myopically focusing on issues in terms of the teeniest short-term spotlight we can consider them in. You don't need some "transformation of consciousness" for that. You just need to actually use reason as it is meant to be used: on the basis of the most comprehensive perspective available. That this is still largely considered "fringe" material shows that not many steps have been taken to increasing the adaptiveness of our overriding paradigm.

I baised, my economic philosophy is very much in agreement with Schumacher. Schumacher takes economics and makes it human, ethical, and easy to understand. Shumacher's perspective is economics as a set of tools to assess and answer questions rather than economics as the answer itself. He highlights the shortcomings of statistical models (i.e., "externalities" such as quality of life, environmental degradation, social impacts, etc are not assessed). The response to Small is Beautiful was the creation of a humanistic economics movement. This movement suggests that deeming something "economic" does not mean it is the automatic correct course of action, rather the first discussion of "economics" should be followed by consideration of whether the action is ethical, ecological, etc. Regarding globalization Schumaker asked "how much further 'growth' will be possible, since infinate growth in a finite environment is an obvious impossibility". The basic tenent of Small is Beautiful is that people should come before economics, that one's workplace/life should be dignified and meaningful first, efficient second, and that nature is priceless.

This is a tough one for me to rate. There were parts of it that I found quite insightful, parts that seemed very dated, parts that felt like a big letdown. Some thoughts: -EFS writes clearly about the problem of the "hedonic treadmill" (though he doesn't use that term) for materialist capitalism: "There are poor societies which have too little, but where is the rich society that says: 'Halt! We have enough'? There is none." -He advocates a "third way" between laissez-faire capitalism and state socialism, which is not just a compromise between the two. Rather, it is a form of organization that I might call a true "ownership society", with ownership being defined not by abstract property rights but by operational reality--that is, people should be able to own things when they can truly exercise personal ownership--so owning a neighborhood business makes sense, but owning a multinational company (or even worse, a share of one) does not. He doesn't use this terminology, but I think his advocacy of small scale is closely tied to the ethics of caring: it is natural to want to care for things one owns, but this is only possible at the human scale on which care can operate. -I appreciated his discussion of "convergent" and "divergent" problems. Briefly, a convergent problem is one where there is a solution that can be communicated to others, who can then carry it out--an example being a math or engineering problem--while a divergent problem is one where this is not the case, such as a social or political problem. Much of modernity, EFS argues, is dedicated to the attempt to reduce divergent problems to convergent problems (for instance, in political organization or education). Not only is this impossible, says EFS, but it actually represents a moral horror--imagine what a world would be like in which convergent solutions had been found to problems of human relationships: a living death, as many sci-fi novels will tell you. The way to deal with divergent problems is not to "solve" them but to live them out. I find this distinction to be pretty useful. -Despite approaching it critically due to the New-Agey title, I actually liked the essay "Buddhist Economics", and I wish he had called it something different as there is little in it that is specific to Buddhism--I think it was just a hot topic in 1973. It's really just about the role of virtue in grounding economic organization. The main focus is on the logic of consumption. EFS notes that standard economic thought understands an increase in consumption as always and everywhere good. On the other hand, nearly all traditional virtue systems agree that "pleonexia" is bad (and this is a case where even classical Greek and Christian understandings of virtue agree). EFS argues that the main measure of interest is happiness per unit of consumption, and that the right way to maximize this is in ways that minimize the denominator while holding the numerator constant. In this essay he doesn't much go into specific ways of doing that, so one could read it as insufferably preachy: "Just be content with less!" But I think that is an unfair reading. I think the argument finds a very powerful application, for example, in the trend away from public goods toward private goods in America--moving from using the municipal pool to everyone having a pool in their backyard. One could argue that this slightly increased individual utility (though I'd be skeptical), but certainly it represents a vast decrease in the happiness/consumption ratio. I could go on but I should probably wrap it up. So, here's my main problem with this book. Despite his avowed love for small-scale organization, EFS ultimately seems not to have the full courage of his convictions. He ends up advocating that more appropriate scale be brought about through a somewhat baroque large-scale technocratic method, involving forced equity participation by the state, "Social Councils", special courts, etc. Throughout the book, whenever EFS was arguing that the status quo was unjust or destructive, I found myself agreeing with him but wondering what to do about it. So when he finally came to describe his prescription in this way, I felt pretty let down. I think that anyone making this type of critique of modern society needs to have the courage advocate actions that can be taken at the scale of individuals or communities, without recourse to the state's monopoly on violence. This, of course, is the hard part, but having just read Dorothy Day I know that people have managed it--perhaps not in ways that are glamorous, but I think that is part of the point.

"Wisdom demands a new orientation of science and technology toward the organic, the gentle, the elegant and beautiful.” Quote of 1970s wisdom 1/17/20 - Reading David Brooks editorial today bringing back memories of my enthusiasm for small scale economics. The NYT opinion writer making a case for 'Big is Beautiful' https://www.nytimes.com/2020/01/16/op... NYT article that describes changes in our small town by big companies: https://www.nytimes.com/2018/03/06/bu... "Thus, the core problem is not capitalists exploiting their workers; it’s the rise of productivity inequality. It’s the companies and individuals who don’t have the skills to take advantage of new technologies" *** Brooks brings back days when I was inclined to Schumacher's vision, by showing bigger is better. When walking with dogs unleashed exploring the juniper and sage landscape with no buildings in sight, where Apple has its security fenced monstrous presence. *** Knew in 1963, when home on leave to Mother's new home in Central Oregon, that I wanted to root myself in the region. A small place in the sunshine with nature all around. ... Where there are now nine gigantic 'clouds' consuming extraordinary amounts of electricity ... Apple and Facebook buildings, including five Facebook structures that have changed my winter sky sunset profile.

I’ve never been all that interested in macroeconomics, but intrigued by the title, I gave Small is Beautiful by E.F. Schumacher a try. It was a long read, but a good one, and I culled interesting insights from every chapter. Schumacher’s visionary simplicity with the largest elements of society were radical 30 years ago, but incredibly relevant, then and today. A fair portion of the book is spent emphasizing the way our economy is unsustainable and how quickly we use up our natural resources. Schumacher also explains how little consideration was put towards pollution until it was too late. In the folksy way of a 60s radical, he speaks about the importance of the land in a way that is neither hollow nor flippant, but full of wisdom and grace. “The whole point is to determine what constitutes progress.” What is progress? What should aid to the third world look like? These questions are where Schumacher particularly shines, explaining a need for intermediate technologies to improve the quality of life for everyone and not just investments which only improve the quality of life for the highest classes and leave the lower ones even more destitute. "No system or machinery or economic doctrine or theory stands on its own feet: it is invariably built on a metaphysical foundation, that is to say, upon man’s basic outlook on life, its meaning and its purpose. I have talked about the religion of economics, the idol worship of material possessions, of consumption and the so-called standard of living, and the fateful propensity that rejoices in the fact that ‘what were luxuries to our fathers have become necessities for us." When I read quotes like that one, I couldn’t help but think about what the economic implications of Christian thought are, and how few Americans I know, least of all me, embody them.

This book was written by EF Schumacher, a German economist. As an Economics graduate at a conservative liberal arts university in the US South, I enjoyed the philosophy and ideas put forward in "Small is Beautiful". Trust me, this was not on my reading list...I am fascinated with the idea that capitalism has become the new religion for the US/West and that envy/greed the primary morals. The book discusses how capitalistic systems push for growth to solve problems, including poverty, unemployment and standard of living. It also shows how capitalistic systems fall short of solving these problems, because it 1) assumes that infinite growth is possible within a finite world (sustainable econ. point) and 2) that the complete focus on increased profits, coupled with new technologies, has led to a decline in the self-fulfillment of mankind in relation to his/her work. The book argues that the community loses when individuals cannot connect to the work they do with their hands/mind, when people cannot connect what they buy from where it came and how it was produced. Schumacher reminds us that there are spiritual, moral and ecological losses in a capitalistic system. All is not lost, but there needs to be awareness of these losses and adjustments made. He argues for small businesses and the utilization of intermediate technologies so that instead of "mass production" we can have production by the masses. This book has inspired me to read more along this subject.

E.F. Schumacher was an economist, And he wrote Small is Beautiful to talk about the economic problems we have in the world. this book was published back in the late ‘70s, and it has been updated more recently. the basic idea of Small is Beautiful is that our economies in the world are big, big businesses, have become too big. And they are not sustainable anymore. we’re destroying the planet Earth because we are consuming too much. Our economies are too big; our population, too big; our companies, too big. Everything has grown too large and his solution, as you might guess, is that we need smaller economies, more local economies, more green economies. So he was writing about this long before Al Gore and An Inconvenient Truth and a lot of other things which are quite common right now. But he was writing about these things way back in the ‘70s. What is the most basic problem? “Economically our wrong living consists primarily in systematically cultivating greed and envy and thus building up a vast array of totally unnecessary wants. It is the sin of greed that has delivered us over into the power of the machine. If greed were not the master of modern man how could it be that the frenzy of consumerism does not abate at higher standards of living and that it is precisely the richest societies which pursue their economic advantage with the greatest ruthlessness? How could we explain the almost universal refusal on the part of the rulers of the rich societies to work towards the humanization of work, soul-destroying , meaningless, mechanical, monotonous, moronic work that is an insult to human nature. These are the facts which are neither denied nor acknowledged but are met with an unbreakable silence. Because to deny them would be too obviously absurd and to acknowledge them would condemn the central preoccupation of modern society as a crime against humanity.“ ===== by A.J

I would classify E.F. Schumacher as an economic philosopher. His thoughts are valid not just in Growth & Development economics but also extend to aspect of microeconomics, corporate culture, human resources and environmental economics. Schumacher is a Gandhian at heart. Nowhere is his writing pure theorising. There are practical application to problems in fields as diverse as you can imagine. The economics we learn in school seems very biased and this book presents a different way to look at it all. A must-read! It is amazing how a book written in the 1970s is just as relevant now as it was then. In a way it suggests we haven't really made any progress in the past 30 years. Nations are made up of people and not the sum of their incomes. Greed and envy cannot consume the human race. Schumacher writes passionately and drives his point home. I wish I could ask him his thoughts on modern day breakthroughs like microfinance and corporate social responsibility. Would he approve? Would he see them as steps in the right direction? Alas we'll never know. I can only draw my conclusions from the writing in this fantastic book.

In an ideal world - as we are talking about ideal worlds, I suppose - I would give Small Is Beautiful five stars: it contains ideas that everyone should be aware of. So, for the ideas, five stars! Unfortunately however, there are different ways to review a book and as a work of literature I found it slightly disappointing. Obviously Schumacher was a great economist-thinker of his day and, I imagine, a charismatic speaker, but this doesn't convince me writing was another of his strong suits. Some essays I was glad to get to the end, not because I disagreed but because I wanted him to get to the point! Or, at least, give me something to think about until he did. One or two were out-of-date, like the case for relatively harmless coal fired power stations. Hence three stars (sure, I liked it - but that's all). The other difficulty I had was the overall style but which was probably down to its age. About the time he was writing it, I was moving up to ''big school'' and being handed those awful, dry-prose things known in our time as ''text books''. This reminded me a lot of those old text books, in contrast to the more conversational, less overly didactic style of today's specialist, non-fiction writers. But that's hardly Schumacher's fault for accidentally being of his own time. tip: One to borrow, not buy. Also, treat the chapters as separate essays - which, I gather, they are - skip the ones that are too unreadable, but don't give up on the book - yet!

"Small Is Beautiful: Economics as if People Mattered." The Economics of E.F. Schumacher is what matters to people even if it's not endorsed by Governments, Companies and other Economists alike. This book is the most unusual treatise, enormously broad in scope, pithily weaving together threads from Galbraith and Gandhi, capitalism and Buddhism, science and psychology. Schumacher's Economics is more humane, ethical, moral, realistic and very close to nature. His economics is explained so succintly is that a reader just loves reading and knowing The Economics as if People really mattered. He questions the very economic principles of the Western Countries and Westernisation of Eastern Countries and cautions the East and tries to plead how much East is rooted in nature than the West and what happens if Western Concept of Economics is accepted all over the world. He explains how "The system of nature, of which man is a part, tends to be self-balancing, self-adjusting, self-cleansing. Not so much with technology." The best part of the book is the Concept of Mixed Economy which the writer explains in the end. He gives an excellent theory of how to tackle "Laissez Faire" economic system which is where one feels why can't the Governments over the world adopt Schumacher's economics and shun the tried and tested economics which is ruining the already ruined world.

My rant: Schumacher centers this book around the idea that economics is a religion with morals based in profits and growth. This was my favorite part. In my experience learning economics in college, it felt like professors would try to equate economics with the natural sciences. They’d call microeconomics a “positive science” which avoids all normative judgements. Schumacher tying in metaphysics and its importance in the economic and education system really hit home. He says that economists “suffer from metaphysical blindness assuming that theirs is a science of absolute and invariable truths without any presuppositions”. Calculations are based on production and growth in an attempt to be unbiased, but who decided that these factors were invariable truths/any good? We fail to include limited resources, or really anything to do with the environment, health, or human nature, in our economic models. And his points about our economic assumptions directing our scientific research to further support development were interesting. I think a 4/5 might be a bit generous of a rating since it’s not the most engaging book, but honestly it was pretty easy to digest and once I sat down and focused I felt like I flew through it. Also, Schumacher is great at pointing out the flaws of our economic system but doesn’t do a fabulous job of talking about solutions to center wellbeing and the environment instead of production and growth. I’m not sure what specific actions I, or even an economist, could take to enact any change. This part felt a little half-hearted honestly. Another thing I did not like was that the section on global development was outdated/wrong. Schumacher makes a lot of blanket statements about poverty and the state of the world which pretty clearly demonstrate why global development can be really destructive. After finishing this book, I feel similar to how I felt after Silent Spring - this was written in 1973 and not much has changed. The “ends” Schumacher talks about are the same, with profits and growth informing measures of efficiency and subjects (like environmental economics!) which account for things like public health and pollution, not integrated in our economic system. But overall, I liked it, especially because it is geared towards any reader, not just people who have studied economics. This is the most effort I have ever/probBly will ever put into a Goodreads review so I suppose that alone can speak to how thought provoking this book is.