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from post-autistic economics
newsletter : issue no. 7, July, 2001
Economists Have No
Ears Steve Keen (University of Western
Sydney, Australia)
Thomas Kuhn once famously
described textbooks as the vehicle by which students learn how to do
'normal science' in an academic discipline. Economic textbooks clearly
fulfil this function, but the pity is that what passes for 'normal' in
economics barely deserves the appellation 'science'.
Most
introductory economics textbooks present a sanitised, uncritical rendition
of conventional economic theory, and the courses in which these
textbooks are used do little to counter this mendacious presentation.
Students might learn, for example, that 'externalities' reduce the
efficiency of the market mechanism. However, they will not learn that
the 'proof' that markets are efficient is itself flawed.
Since this
textbook rendition of economics is also profoundly boring, the majority of
those exposed to introductory course in economics do no more than
this, and instead go on to careers in accountancy, finance or
management - in which, nonetheless, many continue to harbour the
simplistic notions they were taught many years earlier.
The
minority which continues on to further academic training is taught the
complicated techniques of economic analysis, with little to no
discussion of whether these techniques are actually intellectually
valid. The enormous critical literature is simply left out of advanced
courses, while glaring logical shortcomings are glossed over with specious
assumptions. However, most students accept these assumptions because
their training leaves them both insufficiently literate and
insufficiently numerate.
Most modern-day economics students are
insufficiently literate because economic education eschews the study
of the history of economic thought. Even a passing acquaintance with
this literature exposes the reader to critical perspectives on
conventional economic theory - but students today receive no such
exposure.
They are insufficiently numerate because the material
which establishes the intellectual weaknesses of economics is complex.
Understanding this literature in its raw form requires an appreciation
of some quite difficult areas of mathematics-concepts which require up
to two years of undergraduate mathematical training to
understand.
Curiously, though economists like to intimidate other
social scientists with the mathematical rigour of their discipline,
most economists do not have this level of mathematical education.
Though economics students do attend numerous courses on mathematics,
these are normally given by other economists. The argument for this
approach - the partially sighted leading the partially sighted - is
that generalist mathematics courses don't teach the concepts needed to
understand mathematical economics (or the economic version of
statistics, known as econometrics). As any student of econometrics
knows, this is quite often true. However, it has the side effect that
economics has persevered with mathematical methods which professional
mathematicians have long ago transcended. This dated version of
mathematics shields students from new developments in mathematics
that, incidentally, undermine much of neoclassical economic
theory.
One example of this is the way economists have reacted to
'chaos theory'. Most economists think that chaos theory has had little
or no impact-which is generally true in economics, but not at all true
in most other sciences. This is partially because, to understand chaos
theory, you have to understand an area of mathematics known as
'ordinary differential equations'. Yet this topic is taught in very
few courses on
mathematical economics - and
where it is taught, it is not covered in sufficient depth. Students
may learn some of the basic techniques for handling linear difference or
differential equations, but chaos and complexity only begin to
manifest themselves in non-linear difference and differential
equations'. A student in a conventional 'quantitative methods in
economics' subject will thus acquire the prejudices that 'dynamics is
uninteresting', which is largely true of the behaviour of linear
dynamical systems, but not at all true of non-linear systems. This
prejudice then isolates the student from much of what is new and
interesting in mathematical theory and practice, let alone from what
scientists in other sciences are doing.
Economics students
therefore graduate from Masters and PhD programs with an effectively
vacuous understanding of economics, no appreciation of the intellectual
history of their discipline, and an approach to mathematics which
hobbles both their critical understanding of economics, and their
ability to appreciate the latest advances in mathematics and other
sciences.
A minority of these ill-informed students themselves go
on to be academic economists, and then repeat the process. Ignorance
is perpetuated.
The attempt to conduct a critical dialogue within
the profession of academic economics has therefore failed, not because
economics has no flaws, but because - figuratively speaking -
conventional economists have no ears. So then, 'No More Mr Nice Guy'.
If economists can't be trusted to follow the Queensberry Rules of
intellectual debate, then we critics have to step out of the boxing
ring and into the streets. Hence my book 'Debunking Economics', which
describes the many formal academic critiques of neoclassical economics
in a manner which - I hope - is accessible to a the interested
non-economist and non-mathematical readership. But it should also
prove very useful to those who have come to regard conventional
economic theory as autistic, since it clearly and simply explains the
source of this endemic autism. s.keen@uws.edu.au
SUGGESTED
CITATION:
Steve
Keen (2001) “Economists Have No Ears”, post-autistic economics
newsletter : issue no. 7, July, article 4. http://www.btinternet.com/~pae_news/review/issue7.htm
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