Today’s A-Hed in the WSJ tells the story of twenty-six Trappist monks at St. Sixtus Abbey in Belgium who have found themselves cursed by the trappings of success. Since 1839, the bald-headed brewers have been selling Westvleteren beer in order to cover the basic expenses of the monastic lifestyle. Problem is, the beers they brew are so good, with one being perhaps the best in the world, that beer drinkers the world over are willing to pay top-dollar for the heavenly concoction–far more, in fact, than would be required to fund the simple life of the Trappists.
To the good Christian monks, who eschew profits as immoral and irrelevant and who do not want increased production to take time away from their spiritual duties, the solution has been to keep production at the same level for over sixty years, to devote no money to advertising or even to label the bottles, to limit the number of cases that any one person can buy (two per month), and to charge about$1.50 per bottle, which is probably less than 1/10th of the market-clearing price. The results have been predictable: there is far too little supply to satisfy demand, and online gray markets have emerged in order to satisfy thirsting consumers the world over.
Now, in my opinion, the gray markets are simply doing what the monks should be doing themselves–that is, charging a price that rations the scarce beer to those who value it most. But because the monks don’t do this themselves (instead trying to ration the beer rather awkwardly with purchase limits), it’s only natural that arbiters elsewhere would. To me, this seems a decent reconciliation: the beer flows to the most demanding mouths, and the monks needn’t taint their piety with profits. The monks, however, are indignant at the emergence of the gray markets and browse the internet daily in order to ask the online vendors to desist.
Religion and commerce have long been uneasy bedfellows because of the distrust surrounding profit. St. Thomas Aquinas, for example, wrote in Summa Theologica that it was immoral to charge more for a product than the costs of producing it plus a reasonable fee. The implication has always been and continues to be that if one earns a large profit, one must somehow be gouging the consumer. Unless coerced, however, no consumer will ever pay more for something than he thinks it is worth. Thus, profits can only result from a creation of value, and the larger the profit, the more value that has been created. Profits are nothing to be ashamed of–they’re a mark of a need or desire well met.
The Trappists monks would no doubt agree with the old aphorism that “virtue is its own reward.” The economist’s immediate retort would be, “Au contraire, my friend–reward is its own virtue.”