Mapping Mainstream Economics: Genealogical Foundations of Alternativity seeks to establish a definition of the mainstream, and by extension the alternatives to it, by adopting a genealogical approach: tracing the methodological development of the economic mainstream through its ancestry, which allows for a definition of the mainstream which is separate from politically charged categories or gridlocked academic arguments between received schools of thought. The book follows the evolution of the economic mainstream through four major transformations (...) of the discipline: from political to analytical economics, debates around a logical empiricist economics, the consolidation of neoclassical economics and the recent expansion of the mainstream. For each of these steps, the key point of departure is explored, illustrated through the work of leading authors at the time. Thus, the book draws on recent research from the history of economic thought and debates the crucial role of historic concepts of economics for alternativity in the field. Finally, to put the approach into practice, the book examines the relation between today's mainstream and two of its relatives: ecological economics and degrowth. Finally, the book reflects on recent exciting developments in the discourse on alternativity and sheds light on some distant relatives of today's mainstream. This book marks a significant contribution to the literature on the debates around the state and nature of mainstream, alternative and heterodox economics. (shrink)

In this paper, I compare the methodology of the Austrian school to two alternative methodologies from the economic mainstream: the ‘orthodox’ and revealed preference methodologies. I argue that Austrian school theorists should stop describing themselves as ‘extreme apriorists’ (or writing suggestively to that effect), and should start giving greater acknowledgement to the importance of empirical work within their research program. The motivation for this dialectical shift is threefold: the approach is more faithful to their actual practices, it better illustrates (...) the underlying similarities between the mainstream and Austrian research paradigms, and it provides a philosophical foundation that is much more plausible in itself. (shrink)

Mainstream economics, with its rational actor models, appears to be against common sense. For example, it does not take into account how tribal people are. They have a group identity and they are largely concerned with perpetuating that identity. I propose that mainstream economics is not more opposed to common sense than alternative frameworks. The appendix introduces a counterexample to transitivity of preferences, which I assume is where the chief value of the paper is.

This essay is concerned with the special difficulties that arise in testing and appraising mainstream economic theory. I argue that, like other theories designed to apply to complex open systems, it is very hard to confirm mainsteam economics. Parts can be tested and appraised, but the theory is only very weakly supported by evidence.

This essay is concerned with the special difficulties that arise in testing and appraising mainstream economic theory. I argue that, like other theories designed to apply to complex open systems, it is very hard to confirm mainsteam economics. Parts can be tested and appraised, but the theory is only very weakly supported by evidence.

Meaning and Purpose of Life are perhaps the most thought about, if not talked about, issues on the planet since human beings have walked on earth. This book is another attempt to understand the Meaning and Purpose of Life using ideas of Vedanta in Indian philosophy, and of mainstream economics. Starting from first principles, Dr Agarwal explores the core concept of Brahman in Vedanta, and builds an axiomatic foundation for understanding the meaning and purpose of life using the (...) fundamental ideas of the Prasthana Traya, and in particular of The Bhagavad Gita and The Principal Upanishads. Dr Agarwal adheres to the philosophy of Karma Yoga as his chosen area of interest for the exploration of meaning and purpose, which allows him to seek linkages between the concepts of social welfare in Vedanta and economics. Ideas of lokasamgraha in Indian Philosophy and of externalities in economics provide a clear common ground between the two apparently disparate disciplines. Throughout the book, he emphasizes simple practical approaches for making life more meaningful and happier, while relying fundamentally on the basic ideas of Vedanta. (shrink)

I identify and resolve an internal tension in Critical Contextual Empiricism (CCE) – the normative account of science developed by Helen Longino. CCE includes two seemingly conflicting principles: on one hand, the cognitive goals of epistemic communities should be open to critical discussion (the openness of goals to criticism principle, OGC); on the other hand, criticism must be aligned with the cognitive goals of that community to count as “relevant” and thus require a response (the goal-relativity of response-requiring criticism principle, (...) GRC). The co-existence of OGC and GRC enables one to draw both approving and condemning judgments about a situation in which an epistemic community ignores criticism against its goals. This tension results from conflating two contexts of argumentation that require different regulative standards. In the first-level scientific discussion, GRC is a reasonable principle but OGC is not; in the meta-level discussion about science, the reverse holds. In meta-level discussion, the relevance of criticism can be established by appealing to goals of science that are more general than the goals of a specific epistemic community. To illustrate my revision of CCE, I discuss why feminist economists’ criticism of the narrowness of the goals pursued in mainstream economics is relevant criticism. (shrink)

Abstract Many of Boettke's criticisms of formalist economics are justified. However, he defines formalism so broadly that it becomes practically synonymous with mainstream economics, while his criticisms primarily target the sins of formalist economics more narrowly defined. And since he treats Austrian economics as the only viable alternative to mainstream economics, he incorrectly awards victory to Austrian economics. While Austrian economics has some valuable ideas to contribute to mainstream economics, (...) it has serious deficiencies of its own. (shrink)

ABSTRACTThe concept of Methodenstreits is used to analyse the relationship between behavioral and mainstream economics. A Methodenstreit is understood by the authors as a dispute between the more a...

Abstract: The paper argues that mainstream economics and mainstream philosophy of natural science had much in common during the period 1945-1965. It examines seven common features of the two fields and suggests a number of historical developments that might help explain these similarities. The historical developments include: the Vienna Circle connection, the Samuelson-Harvard-Foundations connection, and the Cold War operations research connection.

Theoretical economics should not be divorced from real life. If theoretical research cannot provide a good explanation for real-world economic phenomena, then we have to question the appropriateness of the paradigm that our theoretical research follows. The battle between neoclassical macroeconomics and Keynesian economics has exposed the inadequacy of the paradigm that modern mainstream economics has followed. Neoclassical macroeconomics and Keynesian economics have the same microeconomic basis. However, the paradigm of the microeconomics on which they (...) are based has serious flaws—the scarcity hypothesis and the economic man hypothesis—do not conform to the facts. These two hypotheses are the basis for other hypotheses and principles, but neither of these two hypotheses holds up to scrutiny. Then the economics edifice built on this foundation is certainly unstable, and the corresponding economic policies are certainly not perfect. (shrink)

The paper contends that neoclassical ideology stems, to a great extent, from mathematical analysis. It is suggested that mainstream economic thought can be comprehensively revisited if both histories of mathematical and economic thought are to be taken collaboratively into account. Ideology is understood as a 'social construction of reality' that prevents us from evaluating our own standpoint, and impedes us from realising our value judgments as well as our theories of society and nature. However, the mid-19th century's intellectual controversies (...) about the validity of mathematical thought, truth and knowledge can procure new interesting insights concerning the ideological stance of the first marginalists. In this respect, the methodological categories of analysis and synthesis serve as the basis for the crucial distinction between old geometry and mathematical analysis, indicating that the discipline of mathematics has its own history of fundamentally unresolved disputes. Lastly, this may also shed some light on Alfred Marshall's peculiarly reluctant attitude towards the use of mathematical analysis in his work. (shrink)

An individual's preferences are interdependent when they can be influenced by the behaviour of other agents. This paper analyzes the internal dynamics of an approach in contemporary economics allowing for interdependent preferences, the extended utility approach, which presents itself as a mild reform of neoclassical economics. I contend that this approach succeeds in broadening the policy perspectives of mainstream economics by challenging neoclassical policy stances. However, this success comes with a limitation: the EUA is unable to (...) supply new consensual policy stances as alternatives to the challenged ones. The reason for this limitation is that the EUA opens the possibility of a wide variety of specifications for the utility function, and policy conclusions are sensitive to the details of these specifications. (shrink)

Aristotle warned against a 'missing middle' in logic (Gk Mesos – middle; intermediate). This paper submits that one of the reasons why there has been no major breakthrough in macroeconomics since the financial crisis of 2007-08 has been a missing middle in mainstream micro-macro syntheses, constrained by partial and general equilibrium premises. It maintains that transcending this needs recognition that large and dominant multinational corporations between small micro firms and macro outcomes – while also influencing both – merit the (...) conceptual paradigm of mesoeconomics. Drawing on a range of uses of the concept, it relates this to reasons for 'too big to fail' and suggests implications for policies to gain accountability of big business, including how a meso dimension to input-output could yield transparency on risk-prone financial transactions by banks, and of corporations contributing to climate change. It also critiques misrepresentation of Walras and Pareto, as well as suggesting areas for research which could address, and potentially redress, 'missing middles' in mainstream micro-macro syntheses. (shrink)

Indigenous language bilingual schooling, introduced in Australia's Northern Territory (NT) in 1973, was a reality for over twenty-five schools at the program's height. Today, the language-of-instruction in these same settings is English only, with only 7 state schools operating bilingual programs. Overt Government hostility began with an attempt to defund Indigenous bilingual education in 1998-99. This paper argues that the discursive techniques used to justify these cuts were crucial to developing key themes in ‘mainstreaming discourses’ in Indigenous politics, which has (...) rehabilitated assimilationist thinking in a neoliberal context through the 2000s and since. Using a discourse-historical method, this paper elucidates how mainstreaming discourses were constructed against bilingual education in the 1998–99 debate, and how they emphasized English-only education geared towards neoliberal assimilation for remote Indigenous communities. Indigenous bilingual education was conceived as part of ‘failed’ self-determination in remote Australia. This paper enhances understanding of the patterns and themes of mainstreaming discourses by tracing their genealogical development in this debate. (shrink)

Recent pleas for more heterodoxy in explaining economic action have been defending a pluralism for economics. In this article, I analyse these defences by scrutinizing the pluralistic qualities in the work of one of the major voices of heterodoxy, Tony Lawson. This scrutiny will focus on Lawson's alternatives concerning ontology and explanation to mainstream economics. Subsequently, I will raise some doubts about Lawson's pluralism, and identify questions that will have to be addressed by heterodox economists in order (...) to maintain the claim of pluralism. (shrink)

This paper is motivated by Davis’ [14] theory of the individual in economics. Davis’ analysis is applied to health economics, where the individual is conceived as a utility maximiser, although capable of regarding others’ welfare through interdependent utility functions. Nonetheless, this provides a restrictive and flawed account, engendering a narrow and abstract conception of care grounded in Paretian value and Cartesian analytical frames. Instead, a richer account of the socially embedded individual is advocated, which employs collective intentionality analysis. (...) This provides a sound foundation for research into an approach to health policy that promotes health as a basic human right. (shrink)

There is an increasingly widespread belief, both within and outside the discipline, that modern economics is irrelevant to the understanding of the real world. Economics and Reality traces this irrelevance to the failure of economists to match their methods with their subject, showing that formal, mathematical models are unsuitable to the social realities economists purport to address. Tony Lawson examines the various ways in which mainstream economics is rooted in positivist philosophy and examines the problems this (...) causes. It focuses on human agency, social structure and their interaction and explores how the understanding of this social phenomena can be used to transform the nature of economic practice. Economics and Reality concludes by showing how this newly transformed economics might set about shaping economic policy. (shrink)

There are two fundamentally different approaches to innovation: incremental and radical. In Economics as Anatomy, G.M. Peter Swann argues that economics as a discipline needs both perspectives in order to create the maximum beneficial effect for the economy. Chapters explore how and why mainstream economics is very good at incremental innovation but seems uncomfortable with radical innovation. Swann argues that economics should follow the example of many other disciplines, transitioning from one field to a range (...) of semi-autonomous sub-disciplines. In this book, he compares the missing link in empirical economics to being the economic equivalent of anatomy, the basis of medical discourse. Working as a sequel to Swann's Putting Econometrics in its Place, this book will be a vital resource to those who are discontent with the state of mainstream economics, especially those actively seeking to promote change in the discipline. Students wishing to see progress in the teaching of economics will also benefit from this timely book. (shrink)

Until the end of the early 1970s, from a history of economic thought perspective, the mainstream in economics was pluralist, but once neoclassical economics became totally dominant it claimed the mainstream as its own. Since then, alternative views and schools of economics increasingly became minorities in the discipline and were considered heterodox. This book is in honour of John Edward King who has an impressive publication record in the area of economic theory with specific interest (...) in how economic thought in the past shapes current economic theory and enforces certain paths of economic policy and economic development. This book is divided into five themes based on King s interests. The first theme looks at the challenge in trying to reclaim pluralism in economics. The second faces head-on the direct collision of mainstream economics with history of economic thought and heterodox economics. The third addresses classical economic ideas, their central influence in the past and how they can still primarily guide modern pluralist economics. The fourth examines Post Keynesian and Kaleckian economics with a view to providing a more coherent and extensive branch of heterodox economics. The final theme critiques the policy of neoliberalism that has entrenched itself in capitalist economies which have led to financial, industrial, labour, and behavioural/consumerist crises. This text aims to provide a clear path for pluralism to serve the economics discipline as its standard bearer, and to no longer be merely a heterodox challenge to the mainstream. This book is of interest to those who study history of economic thought, political economy and heterodox economics. ". (shrink)

Research in the cognitive sciences indicates that metaphors significantly shape perceptions and approaches to problem solving. With this in mind, this essay argues that it is problematic for ethicists that mainstream economics and other social scientific literature relies on naturalistic metaphors to describe markets. These imply an inaccurate picture of economic phenomena and rhetorically frame many solutions to problems such as inequality as interventionist. This essay proposes that religious ethicists may find resources for avoiding this conceptual hazard in (...) emerging fields of heterodox economics that are attentive to the role of culture and human agency in shaping markets. It introduces feminist, behavioral, institutional, and Austrian economics in particular and highlights some of the specific approaches to inequality adopted in these fields. It then suggests that engaging heterodox perspectives more generally may help ethicists keep in view the full complexity and social nature of the economic problems they analyze. (shrink)

Being a woman hinders advancement in the labor market, an inequity which perpetuates the conconcentration of women in low-paid jobs. Analysis of 1970 United States Census data reveals that women in low-paid occupations have a much lower probability of upward mobility than men. Low-paid service jobs, which are typical for women, provide less opportunity than other jobs. However, even after adjusting for differences in occupation and industry, as well as controlling for age and schooling, women are far less likely than (...) men to experience upward mobility. (shrink)

Economic Imperialism is the claim of some economists that the methodology of neoclassical economics has superior scientific qualities and should be adopted by most or all social sciences. The paper first shows why such a dominant claim could develop among economists but in no other science and then goes on to point out the shortcomings of this claim of methodological superiority. These critical remarks are also relevant for methodological controversies within economics between a mainstream and heterodox economists.

Our socio-economic innovation ecosystem is riddled with ever-increasing complexity, as we are faced with more frequent and intense shocks, such as COVID-19. Unfortunately, addressing complexity requires a different kind of economic governance. There is increasing pressure on economics to not only going beyond its traditional mainstream boundaries but also to tackle real-world problems such as fostering structural change, enhancing sustained growth, promoting inclusive development in the era of the digital economy, and boosting green growth, while addressing the divide (...) between the financial sector and the real economy. This book demonstrates how to apply complexity science to economics, in an effective and instructive way, in the interest of life-enhancing policies. The book revolves around the non-negligible problem of why economics, to date, seems to be insufficient in guiding economic governance to navigate through real and ever-intensifying complex socio-economic and environmental challenges. With its interdisciplinary approach, the book scans the nuanced nexus between complexity and economics by incorporating, as well as transcending the state-of-the-art literature. It identifies ways to trigger opportunities for behaviour change in the economic profession with respect to how to teach and what, introducing and developing further complexity economics thinking with the configuration of its main principles and outlining the silhouette of next-generation economic governance. The book deciphers recommendations both for economic theory, practice, and education and economic governance. It will be of interest to students, scholars, academics, think tank researchers and economic policy practitioners at the national and/or supranational level. Olivér Kovács is a senior research fellow in the Department of Economics and International Economics at the University of Public Service, Budapest, Hungary. (shrink)

In this paper I consider various shifts in my research and understanding stimulated by seeking how to combat social ecological crises connected to modern economies. The discussion and critical reflections are structured around five papers that were submitted to Environmental Values in an open call to address my work. A common aspect is the move away from neoclassical environmental economics, and its reductionist monetary valuation, to a more realist theory and multiple methods. This relates to my work on environmental (...) ethics, plural values, stated preference validity and deliberative monetary valuation. Expanding beyond the narrow confines of mainstream orthodoxy has involved exploring a range of other disciplines (e.g. applied philosophy, social psychology, human geography, political science, social anthropology, history of thought and philosophy of science) and learning from this literature to rethink economics and develop social ecological economics. A broad range of subjects are covered here, including: personal responsibility, social practice, psychology of the individual, participatory processes, value (intrinsic, instrumental and relational), Nature–society relationships and interdependencies, critical realism and the conduct of unifying interdisciplinary science. I end with a series of comments concerning the failings of orthodox economics and the conduct of scientific research for social ecological transformation. (shrink)

In lieu of an abstract, here is a brief excerpt of the content:Reviewed by:Herman Daly’s Economics for a Full World: His Life and Ideas by Peter VictorJeroen Van Den Bergh (bio)Victor, Peter (2022). Herman Daly’s Economics for a Full World: His Life and Ideas. Routledge, Oxon UK and New York USA (ISBN: 978–0–367-55694-5).Herman Daly (1938–2022) spent a lifetime thinking about how to achieve a sustainable economy. In an inclusive biography, Canadian economist and environmental scientist Peter Victor discusses his (...) ideas, critiques and debates with others, while clarifying his motivations and struggles. Daly has greatly influenced others, as reflected by numerous prizes awarded to him. This influence is confirmed by original text boxes in the book that contain statements of many colleagues about his work and person, obtained through a questionnaire survey by the author.As a young man, Daly decided to study economics as he imagined it combined humanities and science. He was disappointed in it being less scientific than hoped, but his environmental concern motivated him to work on reestablishing the foundations of the field in environmental science and ethics. Daly is best known for his critique of economic growth and his alternative of the “steady-state economy.” He contributed, however, many other novel concepts and ideas during his lifetime, such as the ends-means spectrum, empty vs full world, uneconomic growth and optimal scale.Victor explains these ideas in a calm pace, showing a deep knowledge of Daly’s work. He, moreover, is able to connect it to ongoing sustainability research. He does all this in the course of thirteen chapters, covering Daly’s early life, education and career, his views on economics, his personal philosophy and the role of religion, his proposal for a steady-state economy, and his opinions on economic growth, population and migration, money and banking, and the perils of trade. [End Page 117]Ultimate endsMany consider Herman Daly to be a heterodox and even heretic economist. He associates himself with ecological economics, the field he co-founded. But while some of his ideas seem radical, many of his core proposals do not deviate substantially from mainstream economics. For instance, his “ultimate ends” concept is perfectly consistent with the broad notion of “welfare” in standard economics. In line with this, many welfare economists—such as Samuelson (1961), Mishan (1967), Hirsch (1976), Sen (1976), Scitovsky (1976) and Frank (1985)—have expressed themselves as critical of GDP (gross domestic product) dominance and growthmania (van den Bergh 2009). In fact, neoclassical economics is not married to economic growth—this is more the empirical side of macroeconomics. While Daly recognizes these subtleties, some of his followers do not.Daly sees his Protestant religion as delivering the ultimate ends, but Victor notes that this has not led to concrete suggestions. Ultimate ends based in Christian religion may be motivated by the promise of eternal (after)life, which in effect means gratifying selfish preferences. Instead, a humanistic perspective—which Daly also seems to embrace—would stress solidarity with future generations and a bioethical view of solidarity with other species. These distinct viewpoints, combined with diversity of human preferences and experiences, suggest that it will be difficult if not impossible for democratic societies to agree upon ultimate means.The Index of Sustainable Economic Welfare (ISEW), a kind of greened or sustainable GDP metric, is Daly’s most concrete elaboration of ultimate means (Daly and Cobb 1989). For many OECD (Organization for Economic Cooperation and Development) countries, it indicates a stabilization of welfare, despite continued GDP growth (Lawn 2003; Posner and Costanza 2011). As clarified by Victor, The ISEW remains close to GDP, produces a monetary measure, has a simple and transparent calculation method, and received considerably attention from theoretical and empirical angles. In view of this, it may well represent the best candidate for a beyond-GDP metric that can replace the GDP. What urgently fails is an effective institutional procedure to achieve its widespread adoption (van den Bergh 2022).Religion, evolution and biodiversityDaly’s religious standpoint make him skeptical of the modern scientific worldview which regards the world to be governed by materialism and evolution, with no role for a higher purpose or an ultimate end. This led him... (shrink)

Gender mainstreaming has been prioritised within the national agricultural policies of many countries, including Nepal. Yet gender mainstreaming at the national policy level does not always work to effect change when policies are implemented at the local scale. In less-developed nations such as Nepal, it is rare to find a critical analysis of the mainstreaming process and its successes or failures. This paper employs a critical gender analysis approach to examine the gender mainstreaming efforts in Nepal as they move from (...) agricultural policies to practices. The research involved a structured review of 10 key national agricultural policy documents, 14 key informant interviews, and two focus group discussions with female and male smallholder farmers. Results suggest that gender mainstreaming in national agricultural policy and practice has largely failed. The creation of the Gender Equity and Social Inclusion (GESI) section within the Ministry of Agriculture and Livestock Development is paradoxical to gender-responsive agricultural innovation because it has received limited human and financial resources with an expectation for women to manage this policy development in informal and largely unrecognized ways. At the regional and local levels, implementation of fundamental gender equity and social inclusion procedures—such as gender-responsive planning and budgeting—has become staff responsibility without requisite formal training, gender sensitization, and follow-up. In Nepal, women as smallholder farmers or agricultural labourers are recognized as a vulnerable group in need of social protection, but the welfare approach to gender mainstreaming has achieved little in terms of gender equity, social inclusion, and agricultural sustainability. This paper concludes that what is generally missing is a systemic transformation of gender roles and relations in agriculture, with policies that would support rural women's empowerment through the provision of economic and political rights and entitlement to productive resources. (shrink)

In the parlance of modern Japanese philosophy, the term Basho denotes a field of experience underlying all conceptions of reality, while remaining itself conceptually ungraspable. The Basho of Economics, then, refers to the economy s hidden experiential ground, which has never been explicitly scrutinized, as such, by mainstream economics. We uncover this ground by discerning the tacit presuppositions of classical and neo-classical theories from the perspective of modern Japanese philosophy. In particular, we draw attention to the traditional (...) atomist assumptions implicit in their equilibrium-centered models. By breaking through these assumptions, we reconstruct the economy as a functional and relational world of habitual and creative activity outside of the scope of mechanical laws.". (shrink)

A guide to the pluralist movement threatening to revolutionise mainstream economics. It looks at how neoclassical economics gained its stranglehold, particularly in the United States, and how the social and intellectual underpinnings of economics have enabled it to maintain this in the face of inconsistent evidence from the real world.

Critics of mainstream economics typically rest important weight on the differences between people and the 'agents' that populate economic theory and economic models. Hollis and Nell (1975) is both representative of and ancestral to many more recent variations on the theme. Lately, the upgraded status of behavioral economics (BE) within the discipline's mainstream has encouraged a number of writers to use revolutionary rhetoric in promotion of a 'paradigm shift' that includes the rejection of 'rational economic man' (...) (Ormerod 1994, Heilbroner and Milburg 1995, Fullbrook 2003). The current leading developers of BE are generally more circumspect, claiming that their approach complements standard theory rather than promising to supplant it (Camerer and Loewenstein 2004, Angner and Loewenstein this volume). However, they generally join the more florid critics in supposing that microeconomics is bound to improve its empirical relevance to the extent that it substitutes the study of people for that of abstract economic agents. Another body of thought that promotes this view stems from Sen's (1977) attack on standard economic agents as 'rational fools', amplified in Davis's (2003) argument that since economic agents lack some essential properties of human individuals, economic theory requires fundamental reform if it is to make progress in explaining human behavior. (shrink)

This article maps the conceptual history of global inequality from its marginal status in the 1980s, its minute mainstreaming within research and globalization discourse from the mid-1990s to the late 2000s, until its popularization, politicization, and “economization” in the wake of the 2008 financial crisis, recession, and the publication of Thomas Piketty's Capital in the 21st Century in 2014. Asking when, why, and how global inequality became a key concept, it draws upon quantitative and qualitative analysis of global inequality in (...) scientific articles, books, and public media. It traces transformations in the term's temporal and spatial meanings and situates these in the contexts of rising within-nation and declining between-nation inequality, inequality research, inequality in public media, and broader discursive fields. (shrink)

There is a growing perception among economists that their field is becoming increasingly irrelevant due to its disregard for reality. Critical realism addresses the failure of mainstream economics to explain economic reality and proposes an alternative approach. This book debates the relative strengths and weaknesses of critical realism, in the hopes of developing a more fruitful and relevant socio-economic ontology and methodology. With contributions from some of the leading authorities in economic philosophy, it includes the work of theorists (...) critical of this approach. In the first part, contributors develop and deepen economics as a realist social theory by considering the work of individuals, various schools of thought, socio- economic phenomena and methodology. In the second part, contributors weigh the strengths and weaknesses of critical realism. (shrink)

The theme of this issue of the St. Gallen Business Review is "Harmony". For this reason, we would like to discuss whether two aspects of our life- world are in harmony, namely economic optimization and morality. What is the relation between them? According to a widely shared view, which is one aspect of the doctrine of "mainstream economics", the functioning of an economic system does not require moral behaviour on the part of the individual economic agent. In what (...) follows, we will try to convince you that this is false. If all economic agents – managers, employees, bankers, consumers and so on – were purely self-interested, as mainstream economics assumes, our economic practice would fail. There are various reasons for this. Here we will focus on one of them, namely the pivotal role of interpersonal communication. (shrink)

This eagerly anticipated new book from Tony Lawson contends that economics can profit from a more explicit concern with ontology than has been its custom. By admitting that economics is not exactly a picture of health at the moment, Lawson hopes that we can move away from the bafflingly intransigent belief that economics is at its core reliant upon mathematical modelling. This maths-envy is the reason why economics is in a state of such disarray. Far from (...) being a polemic against the mainstream, this excellent new book is concerned that if economics is to be saved from itself then there must be a realistic dialogue between the classical heterodox fields. Of interest to philosophers, sociologists and social scientists as well as economists, this comprehensive, logical book is a vital contribution to an important debate. (shrink)

This paper argues that mainstream economics has never before been more influential, that this threatens the future of humanity, and provides a history and defence of ecological economics and human ecology founded on process philosophy showing how these can and should replace mainstream economics.

Mainstream risk analysis deviates in at least two important respects from the rationality ideal of mainstream economics. First, expected utility maximization is not applied in a consistent way. It is applied to endodoxastic uncertainty, i.e. the uncertainty (or risk) expressed in a risk assessment, but in many cases not to metadoxastic uncertainty, i.e. uncertainty about which of several competing assessments is correct. Instead, a common approach to metadoxastic uncertainty is to only take the most plausible assessment into (...) account. This will typically lead to risk-prone deviations from risk-neutrality. Secondly, risks and benefits for different persons are added to form a total value of risk. Such calculations are used to support the view that one should accept being exposed to a risk if it brings greater benefits for others. This is in stark contrast to modern Paretian welfare economics, that refrains from interindividual comparisons and does not require people to accept a disadvantage because it brings a larger advantage for others. (Published Online July 11 2006). (shrink)

Contemporary mainstream economics cannot be seen as disconnected from philosophical concerns. On the contrary, it should be understood as a defence for a specific philosophy, namely, crude quantitative hedonism where money would measure pleasure and pain. Disguised among a great mathematical apparatus involving utility functions, supply, and demand, lies a specific hedonist philosophy that every year is lectured to thousands of economic and business students around the world. This hedonist philosophy is much less sophisticated than that in ancient (...) hedonist philosophers as Epicurus or Lucretius. Furthermore, it does not solve any of the systematic difficulties regularly faced by hedonist philosophy. However, the argument that economics is detached from philosophy works as a rhetorical artifice to protect its dominant underlying philosophy: Philosophical disputes would have to be addressed within the biased mathematical apparatus of quantitative hedonism. Economists and business students must learn to identify the underlying philosophy in mainstream economics and alternative philosophical systems. (shrink)

Economics has long been the ‘dismal science’. The crisis in classical political economy at the end of the nineteenth century produced radically differing intellectual responses: Marx’s reconstitution of value theory on the basis of his dialectical method, the marginalists’ development of subjective value theory, and the historical school’s advocacy of inductive and historical reasoning. It is against this background that economics was established as a discrete academic discipline, consciously modelling itself on maths and physics and developing its focus (...) on theorising exchange. This entailed extraordinary reductionism, with humans regarded as rational, self-interested actors, and class, society, history and ‘the social’ being excised from economic analysis. On the basis of this narrowing of its concerns, particularly from the 1980s onwards, economics has sought to expand its sphere of influence through a form of imperialism which seeks to apply mainstream economic approaches to other social sciences and sees economics as ‘the universal grammar of social science’. The implications of this shift are discussed in Ben Fine and Dimitris Milonakis’s two volumes, where they analyse the fate of the social, the political and the historical in economic thought, and assess the future for an inter-disciplinary critique of economic reason. (shrink)