The core questions of economics are what value is and how it is created. These are mysterious questions, not accessible to the mathematical methods used by the academic discipline of economics, which deals admirably with how "utility"--the technical term for value--is exchanged, stored, communicated, regulated, and gauged, but which remains prudently silent on the nature and origin of utility itself. One of the functions of poets is to go forward, living off the land as it were, when the expeditions of professional scholars and scientists must turn back, having exhausted their supplies of fact and tested theory. In the realm of value the insights of poets can be exceptionally useful, for poets spend their lives making value out of combinations of words that have no economic worth in themselves, being common property, infinitely reproducible, and devoid of rarity value. William Shakespeare, for instance, became one of the richest commoners in England--a media tycoon of his day--essentially by combining words in such a way as to persuade people to pay good money for them. Poets must be always exploring the subtle chemistry of the meaning of words, and the old and new ways in which human beings come to desire and cherish that meaning.
Where poets blaze the trail, economists and business people can follow, usually without knowing who made the path in the first place. In this essay I want to make a large claim, and one that may appear fantastic to those who make a sober living: that Shakespeare can be a wise guide to 21st-century economics.
Shakespeare was a key figure, perhaps the key figure, in creating that Renaissance system of meanings, values, and implicit rules which eventually gave rise to the modern world market, and which still underpins it. Using Shakespeare's dramatic and poetic definitions of such words as bond, trust, good, commerce, market, save, value, means, redeem, dear, interest, honor, company, worth, thrift, use, will, partner, deed, fair, owe, ought, treasure, risk, royalty, fortune, venture, grace, and so on, English-speaking merchants transformed the planet and made the language of a small, cold, wet island the lingua franca of the world.
Shakespeare made us see the business company as like a theater company, a troupe of actors, whose interactions generate the plot of the play and the interest that draws the paying audience; he taught us practically how life with others is not necessarily a zero-sum game but an arena where all may profit and competition increases the payoffs for everyone. By now many other cultures and languages have absorbed those rich and peculiar notions of trade, reciprocity, the deal, and so on, and the practices of democratic politics that arise out of them. Shakespeare's economic language has survived the huge challenges of socialism, communism, fascism, and the other statisms that arose in reaction against its new vision of things.
But its positive contributions have not yet ceased, I believe. Until now they have been largely unconscious and unacknowledged, a habit of thought and feeling absorbed with the 200 or 300 Shakespearean phrases that most English speakers know but do not know they know. For Shakespeare to make his full contribution to the next century, his wisdom must be analyzed more explicitly. This has not happened so far in the area of economics because his critics and interpreters, excellent though they often were, had a notable blind spot as far as money was concerned. Until the 20th century Shakespeare critics were gentlemen scholars who aspired to the old values and lifestyle of the aristocracy, with its contempt for trade and its superiority to money matters; and in the 20th century their successors were university intellectuals whose political loyalties were usually to the left of the general population, and who, as liberals, socialists, or Marxists, likewise despised the market and its values. Thus much of Shakespeare's business wisdom has been passed over in embarrassed silence, and some major misinterpretations have crept into our understanding.
For instance, the gentlemanly and leftist dislike of usury--best defined as interest at a rate higher than one would like to pay--led to a deep and unnecessary discomfort with The Merchant of Venice. The Jewish moneylending capitalist, Shylock, was particularly difficult. The critics' values told them to despise him, as do some of the bigoted Christians of Venice in the play. Yet as good liberals, they also hated ethnic stereotypes and prejudice. They were thus forced to deny the fact that Jews of Shakespeare's time did tend to be strongly represented--and for good reason--in banking, jewelry, commodities, currency exchange, and related money industries, and to excuse what they took to be Shakespeare's anti-Semitism on the grounds that it was not as bad as that of his contemporaries.
What they ignored is that Shakespeare did not disapprove, as his critics did, of the taking of interest. In fact, he evidently regarded it as the foundation of Venetian prosperity, and he has Antonio, one of his most positive characters, invest money at interest to support the newlyweds Lorenzo and Jessica, one of whom is Jewish. Most striking of all, Shylock is punished at the end for not taking the exorbitant interest he has been offered on his bond, but insisting on the worthless pledge of the pound of flesh. In other words, Shakespeare's anti-business critics are completely blind to the implication that Shakespeare is the very opposite of the economic anti-Semite, that he regards the spread of "use" or interest as a creative and valuable, if not very exalted, form of real progress. Shakespeare himself was a large investor in bonds and other interest-bearing securities. His famous words "neither a borrower nor a lender be" are put in the mouth of the "wretched, rash, intruding fool" Polonius, the time-pleasing state bureaucrat in Hamlet who so richly deserves his rather nasty fate, stabbed while spying on a private conversation.
Shakespeare's core insight is that human-created value is not essentially different from natural value. The value that is added by manufacture, and the reflection of that value in profit, are but a continuation of nature's own process of growth and development. Consider the following exchange between the shepherdess Perdita in The Winter's Tale and the disguised king, Polixenes.
Announces Perdita: "...the fairest flowers o' th' season/Are our carnations and streaked gillyvors/Which some call Nature's bastards; of that kind/Our rustic garden's barren; and I care not/To get slips of them." She refuses to grow the gaudier summer flowers, hinting that there is something improper in their ancestry. A "slip" is a cutting, from which a new plant can be propagated or cloned.
Polixenes pursues the matter: "Wherefore, gentle maiden,/Do you neglect them?" Perdita responds, "For I have heard it said,/There is an art, which in their piedness shares/With great creating Nature."
But now she has opened up one of the perennial questions of philosophy. What she has just said is that she objects to the art of selective breeding and hybridization by which Renaissance horticulturalists transformed simple wildflowers into elaborate multicolored blooms. Those blooms could, as the great Dutch tulip breeders found, make huge profits (as well as losses). But like an ardent advocate of environmental purity in our own time, Perdita is suspicious of artificial interventions into nature. Great Creating Nature is for her a goddess like the Gaia of our own New Age philosophers: "I'll not put/The dibble in earth, to set one slip of them;/No more than were I painted, I would wish/This youth to say 'twere well, and only therefore/Desire to breed by me."
Perdita dislikes the hybrid flowers because they use their attractive looks to gain the advantage of being reproduced instead of their more modest sisters. But if Perdita is right, art itself is a profoundly questionable enterprise. The very art of drama in which she is portrayed is a fiction. And what is art? For Shakespeare the word had an enormous range of related meanings, which had not disentangled themselves from each other. It could mean "art" in the contemporary sense of what we find in an art gallery, a book of poetry, a symphony hall, or a theater. But it was also a normal term for skill or technique, and by extension for technology, machinery, and mechanical devices of all kinds. It also meant magic, alchemy, and the mystical sciences of astrology and prognostication. Or it could mean deceptive practice or cunning imposture.
The ambivalence and complexity implicit in Perdita's use of the term are surely quite familiar in our own times. At present we are struggling with the ethical and health implications of the science of genetic engineering by means of recombinant DNA. Should we buy the new genetically altered tomatoes on the grocery shelves, or drink the milk produced with the aid of bovine hormones? What about the strawberries with their chimeric pesticide genes, the experimental fruitflies with eyes growing out of their legs and antennae, or the patented strains of cancerous mice? We must balance the benefits of insulin, thyroid hormones, oil spill�eating bacteria, interferon, and gene-grown taxol against the specter of laboratory killer viruses; gene therapy for inherited diseases against sinister eugenic schemes to improve the human gene pool; in vitro fertilization and implantation against the legal and kinship dilemmas that result when the birth mother is not the same as the genetic mother.
Reading Shakespeare, we become aware that our problems are not new--Perdita's unease prefigures ours. Indeed, since the neolithic agricultural revolution, when we first began selecting plants and animals to breed future stock, we have been in the business of genetic engineering and recombinant DNA. Our humblest domestic and culinary techniques are just as "unnatural" as the activities of the biochemists. Brewer's yeast, sourdough, ginger ale plants, and cheese mites are all out-and-out examples of human tinkering with natural genetic processes. When we divide a clump of irises in the garden we are literally practicing clone technology; when we enter a pedigree dog or cat or pigeon in a show we are practicing eugenics on an entire species. Worse still, when we choose what we believe to be an exceptionally kind, intelligent, attractive, healthy, and honest person to be our mate and bear or sire our children, we are engaged in human eugenics on our own local scale. There is no escape.
Thus Perdita cannot evade the fact that as a tool-using animal--the "dibble" she uses for gardening is a cunning little technological device--she must alter nature in order to survive. She needs "art" in its technological sense. How may this contradiction between nature and art be resolved? Polixenes's reply to Perdita reveals a wisdom that we would do well to take to heart. Recall that she has just disparaged the gillyvors on the grounds that there is an art that went into their ancestry. Says Polixenes: