Dismal science (part B)

[…] economics is a truly generalistic form of expertise, defined by its techniques and epistemological processes rather than by its core beliefs about the way the world works. In fact, what we call the mainstream has been malleable enough to incorporate waves of peripheral (and once rejected) ideas and concepts (think: price rigidities into real business cycle models, increasing returns into growth theory, non-rational behavior). As a result, the core has become multiple and fragmented, but it can still legitimately claim to hold up through, rather than against, this fragmentation. As French regulationist economist Robert Boyer (2016) has recently suggested, this is a paradoxical world in which the respective “truths” of Eugene Fama and Robert Shiller can both legitimately exist, and where the very multi-vocality of the field is actually the mechanism that fosters its resilience.

Rather than taking pre-emptive aim at economics, critics should read more. However well intended, generalized attacks on a discipline that are not based on familiarity serve the same end as Michael Gove’s comments about having had enough of ‘experts’. If we sound defensive in the face of these attacks, it’s because there is something worth defending: a lot of work society can draw on to improve the way it runs itself.

The natural reaction when the economy is bad is to criticise economists. That was what happened after the Global Financial Crisis, with some justification. But what is happening in the UK right now is mainly a result of first austerity and then Brexit. As I explained in detail in my earlier post, if we had followed the advice of mainstream economics austerity and Brexit would not have happened. I have as yet not read a single critique of economics that has pointed that fact out, which if you think about it is extraordinary.