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Religious Practices as a Private or Public Good

My girlfriend and I recently had a discussion with Rabbi Irwin Kula where he voiced his concern that many establishment Jewish religious organizations were too entrenched in keeping their core religious practices private. His overarching point was that keeping traditions insular prevents their wisdom from spreading beyond a small group. Second and maybe just as important, imposing any barriers to spiritual innovation also needlessly risks the obsolescence of a religion’s practices within the practicing group itself.

This dynamic isn’t limited to the Jewish faith.

The idea of a more open, public usage and reinvention of religious practices is at odds with many of the ways traditional standard bearers of organized religion conceptualize and market their practices.  It feels as if this is a sharp, immutable line drawn between religious groups on the one hand and  a more secularized world on the other.

Yet if that’s where we are it feels decidedly sub-optimal.

Why is it that the broad spiritual guidance of these traditions are often obscured by an economic model of privatization and protectionism that discourages outsiders from accessing the wisdom and may prevent these practices from remaining relevant?

The rest of this essay is an exploration of the practical and philosophical implications of characterizing religious practices as a public or a private good.

Religious practices are different than religion

Before we start exploring this metaphor it’s important to clarify that I am talking here about religious practices and not religion itself. This is not about truths, about God, about tanzih and tashbih. I respect (your) faith. I have my own. I’m not here to beat down the bulwarks in an active act of creative destruction. I think it’s much more interesting to explore new ground.

So the entire religion as a product metaphor we’re playing with is about the tools, the processes, and the ceremony that people have built around their beliefs in order to flourish.

Accepting that all religions have wisdom doesn’t mean accepting the value of a given individual religious practice. At the end of the day, the products people have built as parts of their spiritual practice should focus on creating as much value as possible. That means innovating and adopting on what was built before us in a constant process of iteration.

Life isn’t static. It wasn’t mean to be. Why should religious practices be any different?

Maybe the answer stems from how we package the product.

The Religious Product as a Public and Private Good

There are profound differences in thinking about religion as a private or public good. The differences run in two overlapping directions—one more economic and the other more personal. Let’s explore the economic argument first.

First we have the business model of religion. In this context, how we characterize religious practices matters because how we sell our product depends on what we believe we’re selling.  That’s true in terms of messaging, packaging, distribution models, and pricing.

Most goods we buy and consume are private goods.

Economists define private goods as those that are rival and excludable. Rival means that my consumption of the good “uses up” that resource while excludable means the use of that good is controllable. A loaf of bread is a private good. You can choose whether to sell it to me and if I eat it no one else can. (While we could more accurately define a religious product as a club good, i.e. a good that is excludable but non-rival, that feels less clean, metamorphically speaking).

The goal of an organization selling a private good is to earn a profit on each good sold, otherwise it would go out of business. The problem with this profit motive in a religious context (aside from the obvious) is that the market structure of religion isn’t particularly competitive. In fact it more closely resembles oligopoly, a situation in which there are few organizations with highly differentiated products and strong barriers to entry. This results in durable economic power for the incumbents, which translates to pricing power and a tremendous competitive advantage.

Economics also has a lot to tell us about the total social benefit we derive from an oligopolistic market structure. The essence of which is that oligopoly leads to less social benefit than a true free market. This is primarily the result of under-producing the good in question.

In contrast to a private good a public good is non-rival and non-excludable. That means no central firm can control who uses a public good and that my use of it does not preclude you from using it as well. The issue with public goods is that there’s no economic advantage to producing it. Why should I pay for something if I can’t extract value from you to use it? Historically the tendency for us to under-produce public goods has been filled by governments, but as I argue below new tech-enabled models offer a very different possibility.

Obviously the philosophical underpinnings of an organization are very different if their mission is to offer a private good versus attempting to distribute a good no one will pay for. Not only does this philosophical choice set the tone for its leaders, it is also the fulcrum that necessitates the pursuit of very different growth strategies.

What do I mean by that? As an organization looks to sell more and more of its product it inherently has to build out radically different structures to support its efforts. Both structures might be viable (in the sense of persisting over time), but they will come to be radically different in size, shape, membership, Qualityand perhaps potential as well.

Moving from a state of underproduction

In both of the above scenarios we are left with the under-development and under-distribution of religious practices.

In a more controlled oligopolistic environment organizations actively under-produce a good in order to keep prices high and maximize their rent-extraction (i.e. they face a downward sloping demand curve). Theoretically this leaves out an entire segment of the population that is unwilling or unable to afford the price the oligopoly seeks to charge even though these potential consumers value the good above the cost of producing it. The traditional economic solution to solving oligopoly is to open these markets to increased competition. But does that work when talking about religion?

In the public good scenario we also have an underproduction of religious practice. In this instance we can’t charge for the good we’re producing so no one steps up to produce it at all. Traditionally this has been a harder problem to solve, but I think new technology-enabled models offer an intriguing path forward. Specifically the emergence of the open-source model along with new possibilities for distributing a product with (almost) zero marginal costs have the potential to revolutionize the distribution models that  “work” for religious practices.

The open-source opportunity

Open-source models unlock the capacity for tremendous innovation and rapid scale by embracing community contributions. These are innovative de-centralized structures that anyone can build on top of. They also demand different business models. We might need to move from charging directly for the production or furnishing of the product (religious practices) and instead look to offer value-add services. This could mean deeper guidance, access to a similar community, freemium models and so on…and yes the image of ad-supported religious practice is a good one.

In the private sector the main challenge to the sustainability of open-source companies is their ability to maintain competitive advantages while keeping their technology open for others to build upon. To this I offer two thoughts. The first is that maybe religious practices shouldn’t be thought of as a standalone product at all. Maybe we should redefine them as a platform or ecosystem upon which others can build and innovate upon. The economics of a platform or marketplace and the keys to their growth are far different than conventional buyer-seller businesses.

The second point is simply that this is the point where the business analogy falls flat.

Faith and human flourishing aren’t parts of consumer welfare that oligopolistic religious groups should seek to capture.  Most of us don’t care about the economic rent a religious institution can extract from us, and indeed would probably shy away from that line of thinking in the first place. I mean we aren’t even really talking about a good anymore when we talk about spiritual fulfillment.

Fundamentally, we need to ask ourselves whether the purpose of a religious institution should simply be to exist or whether it is to unlock human flourishing (thanks Irwin)?

Be careful what you measure

It’s often said that you optimize for what you measure.

I think the strong reactivity to innovation by traditional religious communities is largely a product of measuring the wrong thing. Since we can’t directly measure flourishing, we instead measure adherence to certain traditions (and since adherence is itself hard to measure, we sometimes proxy that by looking at the strength of a specific religious organization).

But I don’t think measuring continuity of practice gets us where we want to go. Rote tradition and habitual adherence don’t cut it anymore, if indeed they ever did.

We need to get beyond measuring the strength of the underlying institution and start focusing on the embodiment of its wisdoms. I’m not sure exactly how we do this, but I do know that we need to recast the religious product not as something you should do, or something we ought to buy, but as a set of teachings freely offered to those searching for answers. In the end the best products spread organically through word-of-mouth because they meet a real need. Religion is no different except that the need is more profound.

Yet unless we make a change in what we measure and emphasize I think we’re going to continue in a state where we under-produce spiritual value. And what consequences does that have?

Moving from the Economic to the Personal

On a macro-level how we define religious practices shapes how we look to offer them to the world. Closer to home, these definitions also influence our desire to consume the product in the first place.

For me, the very act of classifying one’s spiritual community and practices as open or closed, public or private, goes a long way towards defining how I feel about what it even means to “be religious.” That emotional association runs deep. For example, what is the first image that comes to mind if you think of someone religious? Was it positive or negative? Modern or antiquated? Will that change in the future?

I am not my mental image of a “religious person.” I have never thought of myself as belonging to a singular religion. I am wary of dogma and critical of any sense of superiority or absolutes. Yet I believe that spiritual practices have tremendous potential. I have adopted them from many sources in my own pursuit of sati (grace). So if the ideological demarcation between religion as a public and private good remains so strong, where do I, a pragmatist, look for a product that meets my needs?

That question, my dilemma, is a microcosm for why recasting religion from a private good to a public one is so pivotal (even if we take that transformation in its literal if not precisely economic sense). Because in the end the extent to which organized religion is a part of my life in the future depends a lot on how much I find its practices and community valuable to/for me and my family. I’m not alone in this attitude.

So where do we go from here?

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