= spiritually oriented economic (and political doctrine) which urges individual to restrict the use and service of our immediate surroundings at the expense of the more remote
"The following summary of Swadeshi is taken from excerpts of Gandhi's writings that are published by the Institute of Advanced Studies on their website <www.mkgandhi.org>.
Gandhi considered Swadeshi to be a religious discipline. It is a rule of life to be applied to all situations an individual comes across. The central theme of Swadeshi is that it restricts individuals to the use and service of our immediate surroundings at the expense of the more remote. This makes Swadeshi culturally conservative and economically localist. In politics Swadeshi would have individuals use indigenous institutions. If these were found to be lacking in any respect they should be improved upon. In economics Swadeshi would have individuals use only things that are produced by their immediate neighbors. And individuals should work to make those industries more efficient and complete in any area where the might be found lacking.
Swadeshi dictates that it is each person's duty to find neighbors who can supply our wants. Swadeshi would have every village become an almost self-supporting and self-contained unit, trading only for commodities that are necessary and not locally producible. Each individual would always use home-made things instead of foreign things as long as such use was necessary for the protection of a home industry.
Swadeshi arises out of the philosophy of non-violence. An understanding of economics shows us that buying things from distant people can be harmful because it results in a departure from locally sustainable economies. Non-violence in this case means purchasing everything locally that an individual can. Each individual must not serve a distant neighbor at the expense of the nearest neighbors, and should refuse to buy anything if it injures or interferes with the personal growth of those around them. Swadeshi dictates that it is our immediate duty is to dedicate ourselves to the service of our immediate neighbors.
Gandhi saw that adopting a Swadeshi model of development would result in personal sacrifices to some individuals. But he felt that this was good. Gandhi spoke out against privilege and monopoly. He felt that all material benefits should be shared by everyone. Gandhi saw that this meant that no one person could enjoy an excessively high standard of living. Gandhi advocated a reduction in material possessions so that all people could subsist comfortably.
Gandhi also thought that it was possible to convince people to adopt such sacrifices. He realized the importance of an individual's framing process in dictating their actions. He noted that someone from India of the upper classes would refuse to drink out of the well of an Untouchable even if they were dying of thirst. There are obviously other factors other than resource gain that determine an individual's actions. If the algorithm for resource use becomes a personal philosophy (or 'religion' as Gandhi presented it) that is supported by a social group, individuals will make personal sacrifices.
Swadeshi may be a viable alternative to the economic algorithm. It has local economies being built with the purpose of helping one's neighbor. Economic interactions are not designed to maximize resource availability to each individual but to create the holistic system that everyone wants to see -- a self-sufficient, environmentally sustainable system. Swadeshi is enforced by social selective incentives.
The model of resource allocation decision making that is being used in the western world is severely limited. It assumes a certain, restricted framework of human behaviour where humans act only to increase the availability of material resources to them. Changes to human behaviour within this framework have to be made by an outside agency changing the selective incentives to each individual. This economic algorithm is ineffective because it is not robust when it uses incomplete information and it is too sensitive to political change. This leaves us with the option of altering the human-environment interaction by changing the framing process that each individual uses. There are examples of other decision making algorithms, such as Swadeshi, that could possibly be used to create sustainable human behaviour. To promote sustainable human activity we should reject the economic algorithm focus on developing a new decision making framework." (http://web.uvic.ca/~stucraw/Lethbridge/MyArticles/Economics.htm)