Cultural Economics

By Jackson Henry

“Economies function best in the context of people’s culture”,  said Economist Harry Flieshmen, when asked what the essence cultural economics is about. Cultural Economics (CE), has become an important issue in the 21st century as nations tackle the issues of depleting resources, budget shortages, and their impact on cultures.

In Palau, we too have national issues impacted by cultural interaction with world events and the pressure for change. Our culture continues to play a great role in how Palau reacts to investments laws, imported labor, and how we make purchases. Our changing culture is a by-product of various religions, colonial history, racial inter marriages, ancient customary beliefs and the impact of the educated class of Palauans who have returned from colleges and military careers abroad. All these factors drive how we manage our economy, but frankly speaking, it has produced less than stellar results. We still resist change and avoid making sacrifices to build a self sustaining economy.

The competition among various cultural values has impacted Palau’s creativity and the motivation to get off this failed economic status quo. After 50 years under the Trust Territory and 15 years under COFA, we still find ourselves spinning around a revolving door between budgetary shortfalls and foreign aid dependency.

Solutions may be stored in the Palauan culture. A Yapese chief once told me, “when there is a great problem, we turn to our culture”. Staving off imported food, which takes up a good chunk of our trade imbalance, can be a good start to turning the tide of our dependence on the outside world. If Palau reverts back to cultural foods consumption, money remains in Palau, instead of being exported to foreign countries. Palauans should drink more coconuts and locally bottled water, eat more taro, fish, tapiocas and locally grown fruits. This is a small way to capitalize on our culture to support our economy. Cultural economics may just be the missing block in building ourselves a prosperous economy.

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