In recent years, the AustrianSchool has been an influential contributor to the social sciences. Yet most of the attempts to understand this vital school of thought have remained locked into a polemical frame. The Philosophy of the AustrianSchool challenges this approach through a philosophically grounded account of the School's methodological, political, and economic ideas. Raimondo Cubeddu acknowledges important differences between the key figures in the School--Menger, Mises and Hayek-- but also finds (...) important parallels between these thinkers. The theory of subjective value and the theory of spontaneous order, which both rest on ideas about the limitations of human knowledge, are the most important of these parallels. Drawn together, these theories represent one of the most original avenues of research in the social sciences and a major reformulation of liberal ideology. (shrink)
Focusing on the work of Friedrich von Hayek and Vernon Smith, we discuss some conceptual links between Austrianeconomics and recent work in behavioral game theory and experimental economics. After a brief survey of the main methodological aspects of Austrian and experimental economics, we suggest that common views on subjectivism, individualism, and the role of qualitative explanations and predictions in social science may favour a fruitful interaction between these two research programs.
The subjectivism of the Austrianschool of economics is a special case of Dewey's transactional philosophy, also known as pragmatism or pragmatic epistemology. The Austrian economists Carl Friedrich Menger (1840-1921) and Ludwig von Mises (1881-1973) adopted an Aristotelian deductive approach to economic issues such as social behavior and exchange. Like Menger and Mises, Friedrich A. Hayek (1899-1992) viewed scientific knowledge, even in the social sciences, as asserting and aiming for objective certainty. Hayek was particularly critical of (...) attempts to apply the empiricism of the natural sciences in the social sciences. Though Hayek was not a positivist in the sense ascribed to Milton Friedman (1912-), because he accepted the possibility of final, objective certainty, Hayek's view of scientific knowledge was closer to that of the logical positivists of the Vienna circle than to Dewey's pragmatism. Mises' a priorism, asserting and aiming for apodictic certainty, represented a more extreme form of objectivism even than Hayek's. Mises was similar in this regard to non-Austrian axiomatists such as Gerard Debreau (1921-2005), though he joined Hayek in eschewing mathematical formalism. In Dewey's contrasting view, the scientist commends new, alternative ways of knowing to the scientific community, offering more profound insight or more efficacious practical applications. Alternative ways of knowing which do not offer practical or intellectual benefits are to be rejected. Both the radical subjectivism of the Austrianschool and Dewey's transactional strategy justify rejection of the mirage of social justice. Dewey's knowledge as ways of knowing suggests a broader and more fundamental critique of the socialist position in the calculation debate. The arguments presented by the Austrianschool can be reformulated in terms of Dewey's pragmatic philosophy. (shrink)
In a recent paper (Denis, 2004b) I argued that the neoclassical use of the concept of equilibrium was guilty of a hypostatisation: an equilibrium which is only an abstraction and extrapolation, the logical terminus of a component process taken in isolation, is extracted and one-sidedly substituted for the whole. The temporary is made permanent, and process subordinated to stasis, with clearly apologetic results. I concluded by suggesting that this hypostatisation exemplified the contrast between formal and dialectical modes of thought, and (...) that it may be in the application of a dialectical notion of equilibrium that the heterodoxy can make its most telling contribution. This paper develops the line of thought that, while heterodox currents may superficially appear as divided amongst themselves as they are from the orthodoxy, there is truly something profound uniting the apparently disparate heterodox trends: the adoption of a dialectical method. I draw on the work of Sciabarra (1995, 2000), who argues that making process primary, which we might expect of Austrian economists, is the essence of dialectics, which we might (wrongly, in his view) identify with Marxism. If this view is, as I believe, fundamentally correct, perhaps (a) we can only understand the method of neoclassical economics by contrasting it with a dialectical approach, and (b) we can explore the potential for common ground between the various heterodox currents by examining their attitude, both implicit and explicit, to dialectics. (shrink)
Contemporary Austrian?school economists reject neoclassical welfare theory for being founded on the benchmark of a perfectly competitive general equilibrium, and instead favor a formal theory deemed consistent with the notions of radical subjectivism and disequilibrium analysis. Roy Cordato advances a bold free?market benchmark by which to formally assess social welfare, economic efficiency, and externalities issues. Like all formalist, a priori theory, however, Cordato's reformulation cannot meet its own standards, being theoretically and empirically flawed, and perhaps ideologically suspect.
Fifty years ago, the Argentinean economist Raúl Prebisch published a paper called Estúdio Económico de América Latina. The Estúdio was one of the first texts that set up what was later termed the ?Prebisch-Singer thesis? or, more widely, the Latin American School of Economics. According to this document, Latin American countries should undergo an industrialization program under the direct supervision of the national state. The rationale for this thesis was the deterioration of the terms of trade for countries (...) exporting primary commodities and importing manufactured goods. The focus here is on the argumentative structure of the document, which targets two different audiences, a lay and a specialized one. Relying on a center-periphery metaphor, Prebisch stresses the shortcomings of conventional economic theory when applied to distinct historical circumstances, i.e., to the peculiar conditions experienced by peripheral countries. A rhetorical approach to the Estúdio also shows that it represents a deliberate effort to assemble a large volume of empirical data about Latin America and its foreign trade. This was not a widespread procedure at the time. As is usually the case in well-built argumentative discourses, both inclusion and omission of certain sets of data look strategically contrived. (shrink)
Why would anyone want there to be natural foundations for the social sciences? In a provocative essay exploring precisely that question, historian Chris Renwick uses an interwar debate featuring William Beveridge, Lancelot Hogben, and Friedrich Hayek to begin to imagine what might have been had such a program calling for biological knowledge to form the natural bases of the social sciences been realized at the London School of Economics. Yet perhaps Renwick grants too much attention to differences and (...) “what-ifs” and not enough to the historical question of “what happened” afterward. “Chickens and Eggs” offers an alternative view of this rather vexed question—one grounded in what happened, which suggests that Renwick’s concerns may be somewhat misplaced. (shrink)
Much has been written about the relationship between biology and social science during the early twentieth century. However, discussion is often drawn toward a particular conception of eugenics, which tends to obscure our understanding of not only the wide range of intersections between biology and social science during the period but also their impact on subsequent developments. This paper draws attention to one of those intersections: the British economist and social reformer William Beveridge’s controversial efforts to establish a Department of (...) Social Biology at London School of Economics during the 1920s and 1930s. Featuring a fully equipped laboratory headed by a leading geneticist, the Department of Social Biology was Beveridge’s attempt to “cross-fertilise” biology and social science and, in so doing, take the ideological heat out of social scientific, in particular economic, methods of investigation. Exploring why Beveridge’s project failed and throwing light on its long-term legacies, this paper considers what we can learn from the short-lived Department of Social Biology. (shrink)
The name "School of Salamanca" refers to a group of theologians and natural law philosophers who taught in the University of Salamanca, following the inspiration of the great Thomist Francisco de Vitoria. It turns out that the Scholastics were not simply medieval, but began in the 13th century and expanded through the 16th and 17th centuries; and they developed some original theories about economics and international law.Why should a few men mainly interested in theology and ethics apply themselves (...) in analyzing issues so far from their worries? The answer leads us to a revision of the morality rules, due to the new problems in business ethics. Thus, for example, the appearance of inflation made them have doubts about the merchant's morality. In order to solve this and other problems, they began to analyze the new and suspicious economic activity. As a result of their observations about ethical issues they discovered some advanced theories for the history of economic thought, such as the early formulation of the quantity theory of money. (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 Austrianeconomics as the only viable alternative to mainstream economics, he incorrectly awards victory to Austrianeconomics. While Austrianeconomics has some valuable ideas to contribute to mainstream economics, (...) it has serious deficiencies of its own. (shrink)
This paper sustains that reappraising Austrianeconomics in the light of Aristotelian ideas is not only possible but also fruitful. First, the paper draws a sketch of the essential features of Austrianeconomics. Next, it argues about the necessity for a thorough analysis of the notion of freedom, and it analyzes Mises's conception. Next, the paper exposes Aristotle's social, epistemological and economic thought related to Austrian main traits. An account of how the exercise of Aristotelian (...) virtues may be synergic with economic coordination and a sketch of the consequences of the proposal on the teaching of economics are then provided. Finally, the conclusion shortly sums up the content and relevance of Aristotle's contribution. (shrink)
Much recent work on the intellectual background of Austrianeconomics reveals an unfortunate lack of awareness of the distinct nature of the Austrian contribution to philosophy, from which the Austrian economists drew many of their ideas. The present essay offers a sketch of this contribution, contrasting Austrian philosophy especially with the modes of philosophy dominant in Germany. This makes it possible to throw new light on the relations on Mises, Kant and the Vienna circle, and (...) it allows us also to establish the extent to which Austrianeconomics might properly be seen as being allied to the German hermeneutic tradition of Dilthey, Gadamer, et al. The essay concludes with a criticism of the hermeneutic relativism recently canvassed by some Austrian economists, concentrating especially on the work of Don Lavoie, whose writing are treated as symptomatic of a wider and somewhat regrettable trend. (shrink)
Ludwig von Mises,2 who originated the view, and his students Friedrich Hayek and Murray Rothbard, who developed and extended it. On their view, the laws of economics are conceptual truths, and economic truth is grounded in an a priori science they call praxeology,3 or the “logic of action.”4 Essentially, praxeology is the study of those propositions concerning human action that can be grasped and recognized as true simply in virtue of an inspection of their constituent concepts.
THE ECONOMICS OF TIME AND IGNORANCE by Gerald P. O'Driscoll, Jr. and Mario J. Rizzo New York: Basil Blackwell, 1985. 261pp., $34.95 O'Driscoll and Rizzo, two leading exponents of the Austrian subjectivist school of economics, claim to provide an original and powerful challenge to mainstream neoclassical economics. They also argue that there is much common ground between the Austrian approach and the recent development of Post Keynesian analysis. In this essay, the validity of such (...) claims is analyzed, and the shortcomings of the Austrianschool's approach vis?à?vis Post Keynesian and neoclassical analysis is developed. (shrink)
Does the concept of “race” find support in contemporary science, particularly in biology? No, says Naomi Zack, together with so many others who nowadays argue that human races lack biological reality. This claim is widely accepted in a number of fields (philosophy, biology, anthropology, and psychology), and Zack’s book represents only the latest defense of social constructivism in this context. There are several reasons why she fails to make a convincing case. Zack starts by arbitrarily ascribing an anachronistically essentialist connotation (...) to the concept of race. After having made that everyday notion semantically so crude and outdated there is no wonder that she finds it quite easy to conclude that such an awkward category has no place in science. Her main rationale for seeing our race distinctions as being poorly matched to biological characteristics (e.g., population differences in gene frequencies) is that these biological characteristics do not fall into discrete and mutually exclusive categories as “required” by the common-sense taxonomy. This opposition between the continuity of variation found in biology and the alleged discreteness of common-sense “races” is repeated throughout the book, and it is presented as creating an unbridgeable gap between biology and the colloquial concept of race. Contrary to what Zack says, however, today’s common-sense ideas about race are not so radically disconnected from contemporary science. Rather, “race” in ordinary usage is informed by biological knowledge to a considerable extent. Most people no longer think about race in terms of pre-Darwinian racial “essences” and “mutually exclusive” ideal types. In fact, as pointed out by Anthony Appiah (whom Zack quotes on this matter but without taking him seriously enough), the discourse on race has long been characterized by a practice of “semantic deference,” according to which people tend to use the word “race” assuming that the biologists could say more precisely than they could what it meant.. (shrink)
There is no doubt that Carl Menger and Ludwig von Mises can be considered as two of the most representative and influential members of the Austrianschool of economics. However, given the fact that this school is well known for being a methodological school, it might be surprizing to note how far these two prominent economists apparently stand on methodological questions. While Menger frequently insisted that "no essential differences between the ethical and the natural sciences (...) exists, but at most only one of degree"1, Mises emphasizes the alleged gulf between social and natural sciences to the point of adopting what he called a "methodological dualism". As a consequence of this dualism, Mises did not hesitate when it comes to the analysis of human action to refer to laws "derived a priori" that "permit of no exception" because they belong to "an aprioristic and universally valid theory" 2. Such an uncompromising apriorism was so contrary to the empiricist mood of.. (shrink)
SUBJECTIVISM, INTELLIGIBILITY AND ECONOMIC UNDERSTANDING: ESSAYS IN HONOR OF LUDWIG M. LACHMANN ON HIS EIGHTIETH BIRTHDAY Edited by Israel M. Kirzner New York: New York University Press, 1986. 319 pp., $35.00.
This essay analyzes the relations between Austrian Praxeology and sociology. It argues that Praxeology is not only a codification and ramification of pure market economics but also to some degree the Austrianschool's variant or proxy of sociology. This argument particularly applies to Mises' Praxeology as the general theory of human action, with Weber's sociology understood as the science of social action, taken as Mises' acknowledged sociological source, inspiration or anticipation. The essay develops and substantiates the (...) argument by identifying certain sociological premises, concepts and observations in Mises' Praxeology, which are classified into the fields of general sociology, economic sociology and political sociology. The essay builds on and contributes to the growing economics and sociological literature on the relationship between Austrianeconomics and Weberian (and other) sociology. (shrink)
A deep theme of Austrianeconomics has been that of spontaneous order or selforganization of the economy. The origin of this theme dates to the putative founder of the AustrianSchool, Carl Menger, with his theory of the spontaneous emergence of money for transactions purposes in primitive economies being archetypal example (Menger, 1892). Menger drew this approach from the Scottish Enlightenment figures David Hume, Adam Ferguson, and Adam Smith, with the latter’s Wealth of Nations (1776) particularly (...) important. The most important developer of this idea within the tradition after Menger was F.A. Hayek (1948), who would identify this self-organization phenomenon with emergence, later expanding upon this into the broader concept of complexity (Hayek, 1952, 1967). Caldwell (2004) argues that this became an increasingly important focus of Hayek’s thought in the later years of his life. Among those examining this development in more detail besides Caldwell have been Koppl (2006, 2009), Rosser (2010a),1 and Lewis (2010). This essay will consider more thoroughly the relationship between the concepts of emergence and complexity and the roles that they have played in Austrianeconomics as well as more broadly in philosophy and science. An important point is that both of these concepts do not possess precise meanings; they are “terms of art” within philosophy. However, while closely linked through the general idea of a whole being “greater than.. (shrink)
This article presents a skeleton of a potential paradigm of human flourishing and happiness in a free society. It is an exploratory attempt to construct an understanding from various disciplines and to integrate them into a clear, consistent, coherent, and systematic whole. Holding that there are essential interconnections among objective [...].
The primary aim of the text is to introduce the reader to the relationship between economics and ethics and to the application of economic ethics in the evaluation of the market. The reader will gain insight into: * The ethical and methodological strategy of economics and criticism of the core assumptions that underpin the economic defense of free market operation. * The characteristics of different ethical theories (utilitarianism, duty and rights ethics, justice and virtue ethics) that can be (...) used to evaluate the free market. * How to apply economics in conjunction with ethical theories to evaluate economic trends and policies that promote the free operation of the market and are subject to public debate. These insights will help to develop the reasoning and analytical skills needed to criticize economic analysis as well as to apply ethical concepts to moral issues in economic policy. (shrink)
Abstract Murray Rothbard's Austrian Perspective on the History of Economic Thought demonstrates his mastery of the literature. But his interpretation of the development of economics reflects, and is therefore severely limited by, his Austrian?libertarian perspective. Indeed, Rothbard appropriates the history of economic thought principally to advance his perspective, as seen in his neglect of social control, his identification of his desired economic system with the natural order of things, and especially in his denigratory treatment of Adam (...) Smith?at bottom for not being an Austrian economist and a true libertarian. A partly informed, partly myopic and sometimes useful interpretation, this is the work of an ideologue. (shrink)
This article reports the results of an exploratory investigation of a particular area of moral tension experienced by MBA students in a graduate school of business. During the first phase of the study, MBA students'' own perceptions about the moral climate and culture of the business school were examined. The data gathered in this first part of the study indicate that the students recognize that a central part of this culture is constituted by a shared familiarity with a (...) set of institutionally reinforced premises about human behavior and motivation including the ideas that: 1) people are self-interested utility-maximizers, 2) individuals should be unimpeded in their pursuit of their own self-interest through economic transactions, and 3) virtually all human interactionsare economic transactions. The data further indicated that the business students experience a degree of tension between this ethic of self-maximizing and the everyday ethics prevalent in our broader culture, in which altruism and selflessness are central elements. The final section of the study was an effort to see whether and how these institutionally sanctioned premises were integrated into the students'' arguments about the relationship between self-interest and social responsibility. (shrink)
Research in the social sciences received generous patronage in the late 1960s and early 1970s. Research was widely perceived as providing solutions to emerging social problems. That generosity came under increased contest in the late 1970s. Although these trends held true for all of the social sciences, this essay explores the various ways by which economists in particular reacted to and resisted the patronage cuts that were proposed in the first budgets of the Reagan administration. Economists’ response was three fold: (...) to engage in joint lobbying with other social scientists, to tap into their authority as a respected policy player, and to influence the types of research financed by the patron. With interviews of the former lobbyist for the social scientists, the former director of the Economics program for the National Science Foundation, and a review of the archival records of economists and their scholarly society, we discuss how economists have claimed entitlement to patronage in the closing decades of the twentieth century. We observe a dynamic and productive relationship between politicians and researchers mediated by the National Science Foundation, where civil servants, lobbyist and public minded scientists, and self-serving grantees trade roles. (shrink)
Which schools of thought are favored by German economists? What makes a good economist and which economists have been most influential? These questions were addressed in a survey, conducted in the summer of 2006 among the members of the ?Verein für Socialpolitik?. An econometric analysis is used to identify to what extent ideological preferences or personal factors determine the respondents' answers. Our results suggest that German economists favor neoclassical economic theory as a school of thought and appreciate the contributions (...) of their Anglo-Saxon colleagues much more than their fellow compatriots' contributions. Furthermore, a ?good? economist should have expertise in a certain field, as well as a broader knowledge of general economics. Some of the results can be compared to Colander (2008). The results indicate that graduate programs noted for their American style greatly influence a student's opinion as to what attributes a good economist must have. (shrink)
Global Economy, Global Justice explores a vital question that is suppressed in most economics texts: "what makes for a good economic outcome?" Neoclassical theory embraces the normative perspective of "welfarism" to assess economic outcomes. This volume demonstrates the fatal flaws of this perspective--flaws that stem from objectionable assumptions about human nature, society and science. Exposing these failures, the book obliterates the ethical foundations of global neoliberalism. George DeMartino probes heterodox economic traditions and philosophy in search of an ethically viable (...) alternative to welfarism. Drawing on the work of Amartya Sen, DeMartino proposes the egalitarian principle of the "global harmonization of capabilities" to guide economics. This principle provides a basis for resisting oppression the world over while nevertheless demanding respect for cultural diversity. DeMartino puts this principle to work adjudicating contemporary debates over global policy regimes, and completes thebook with a set of deeply egalitarian global policies for the year 2025. Global Economy, Global Justice 's engaging prose will appeal to those seeking to understand the intersection between economics and political philosophy. Its focus on the normative foundations of contemporary policy disputes makes it unique in the literature on globalization. (shrink)
This paper attempts to assess the recent literature on feminist economics from the perspective of modern Austrianeconomics. Feminists and Austrians share many epistemological and methodological criticisms of neoclassical theory, although Austrians have never linked those criticisms to gender. Both groups argue that the attempt to mimic the methods of the natural sciences has been a particular source of trouble for neoclassicism. The paper suggests that these common points of criticism can serve as a starting point for (...) dialogue between the two groups. Despite their similar criticisms, the groups do have divergent views on what economic theory should look like, as well as the policy conclusions that likely flow from those theories. The paper explores two examples of theoretical differences (the concept of utility and the relationship between competition and cooperation) and suggests ways that feminists and Austrians might begin to sort out their differences. (shrink)
This book is a survey of the most important developments in Austrian philosophy in its classical period from the 1870s to the Anschluss in 1938. But I hope that the volume will be seen also as a contribution to philosophy in its own right as an attempt to philosophize in the spirit of those, above all Roderick Chisholm, Rudolf Haller, Kevin Mulligan and Peter Simons, who have done so much to demonstrate the continued fertility of the ideas and methods (...) of the Austrian philosophers in our own day. For some time now, historians of philosophy have been gradually coming to terms with the idea that post-Kantian philosophy in the German-speaking world ought properly to be divided into two distinct traditions which we might refer to as the German and Austrian traditions, respectively. The main line of the first consists in a list of personages beginning with Kant, Fichte, Hegel and Schelling and ending with Heidegger, Adorno and Bloch. The main line of the second may be picked out similarly by means of a list beginning with Bolzano, Mach and Meinong, and ending with Wittgenstein, Neurath and Popper. As should be clear, it is the Austrian tradition that has contributed most to the contemporary mainstream of philosophical thinking in the Anglo-Saxon world. For while there are of course German thinkers who have made crucial contributions to the development of exact or analytic philosophy, such thinkers were outsiders when seen from the perspective of native German philosophical culture, and in fact a number of them, as we shall see, found their philosophical home precisely in Vienna. When, in contrast, we examine the influence of the Austrian line, we encounter a whole series of familiar and unfamiliar links to the characteristic concerns of more recent philosophy of the analytic sort. As Michael Dummett points out in his Origins of Analytic Philosophy, the newly fashionable habit of referring to analytic philosophy as "Anglo-American" is in this light a "grave historical distortion". If, he says, we take into account the historical context in which analytic philosophy developed, then such philosophy "could at least as well be called "Anglo-Austrianâ€" (1988, p. 7). Much valuable scholarly work has been done on the thinking of Husserl and Wittgenstein, Mach and the Vienna Circle. The central axis of Austrian philosophy, however, which as I hope to show in what follows is constituted by the work of Brentano and his school, is still rather poorly understood. Work on Meinong or Twardowski by contemporary philosophers still standardly rests upon simplified and often confused renderings of a few favoured theses taken out of context. Little attention is paid to original sources, and little effort is devoted to establishing what the problems were by which the Austrian philosophers in general were exercised B in spite of the fact that many of these same problems have once more become important as a result of the contemporary burgeoning of interest on the part of philosophers in problems in the field of cognitive science. (shrink)
This article provides an Austrian overview of the inflation versus deflation debate which has captured the attention of the economics profession in the years following the US housing bust. Much of the Austrian analysis of this debate has focused on the massive expansion of the Federal Reserve’s balance sheet and attendant [...].
This is a comprehensive anthology of works concerning the nature of economics as a science, including classic texts and essays exploring specific branches and schools of economics. Apart from the classics, most of the selections in the third edition are new, as are the introduction and bibliography. No other anthology spans the whole field and offers a comprehensive introduction to questions about economic methodology.
In a recent paper (Denis, 2004b) I argued that the neoclassical use of the concept of equilibrium was guilty of a hypostatisation: an equilibrium which is only an abstraction and extrapolation, the logical terminus of a component process taken in isolation, is extracted and one-sidedly substituted for the whole. The temporary is made permanent, and process subordinated to stasis, with clearly apologetic results. I concluded by suggesting that this hypostatisation exemplified the contrast between formal and dialectical modes of thought, and (...) that it may be in the application of a dialectical notion of equilibrium that the heterodoxy can make its most telling contribution. This paper develops the line of thought that, while heterodox currents may superficially appear as divided amongst themselves as they are from the orthodoxy, there is truly something profound uniting the apparently disparate heterodox trends: the adoption of a dialectical method. I draw on the work of Sciabarra (1995, 2000), who argues that making process primary, which we might expect of Austrian economists, is the essence of dialectics, which we might (wrongly, in his view) identify with Marxism. If this view is, as I believe, fundamentally correct, perhaps (a) we can only understand the method of neoclassical economics by contrasting it with a dialectical approach, and (b) we can explore the potential for common ground between the various heterodox currents by examining their attitude, both implicit and explicit, to dialectics. (shrink)
A spate of recent attacks on the rationality assumption in economic theory is noticed. Some of these attacks are fresh and, in many ways, original, but the central ideas underlying them are not new. They appear to have been provoked by the direction in which much of mainstream economics has been moving in recent years. On the other hand, it is suggested here, certain developments in contemporary economics, associated particularly with the revival of interest in the Austrian (...) paradigm, offer afresh understanding of the way in which the rationality assumption, its role in economics properly understood, is able to meet these old?new attacks. (shrink)
Machine generated contents note: Introduction; 1. Coming of age in Wilhelmine Germany; 2. Student years in Frankfurt; 3. A materialist interpretation of the history of modern philosophy; 4. The beginnings of a critical theory of contemporary society; 5. Horkheimer's integration of psychoanalysis into his theory of contemporary society; 6. Horkheimer's concept of materialism in the early 1930s; 7. The anthropology of the bourgeois epoch; 8. Reflections on dialectical logic in the mid-1930s; Excursus I. The theoretical foundations of Horkheimer's split with (...) Erich Fromm in the late 1930s: Fromm's critique of Freud's drive theory; Excursus II. Divergence, estrangement, and gradual rapprochement: the evolution of Horkheimer and Adorno's theoretical relationship in the 1930s; 9. State capitalism - the end of Horkheimer's early critical theory; Epilogue: toward a historicization of Dialectic of Enlightenment and a reconsideration of Horkheimer's early critical theory. (shrink)
Abstract Ethics education should aim to promote students? maturity across a broad spectrum of moral functioning, including moral reasoning, moral affect and moral behaviour. To identify the most effective strategy for promoting the comprehensive moral maturity of high school students, we enrolled students in one of four groups: an introductory ethics class, a blended economics??ethics class, a role?model ethics class taught by graduate students and a non?ethics comparison class. Pretest and post?test instruments measured the ways students (a) reason, (...) (b) feel and (c) act with regard to ethical?normative issues. The results indicated that the approaches to teaching ethics varied considerably in terms of their ability to promote significant positive changes in students? moral reasoning, empathy and behaviour. (shrink)
This is a comprehensive anthology of works concerning the nature of economics as a science, including classic texts and essays exploring specific branches and schools of economics. Apart from the classics, most of the selections in the third edition are new, as are the introduction and bibliography. No other anthology spans the whole field and offers a comprehensive introduction to questions about economic methodology.
Hermeneutics has become a major topic of debate throughout the scholarly community. What has been called the "interpretive turn" has led to interesting new approaches in both the human and social sciences, and has helped to transform divided disciplines by bringing them closer together. Yet one of the largest and most important social sciences economics has so far been almost completely left out of the transformation. Economics and Hermeneutics takes a significant step towards filling this gap by introducing (...) scholars on both sides of the divide to ways that hermeneutics might help economists address some of their most important problems. Among the topics addressed are entrepreneurship, price theory, rational expectations, monetary theory, welfare economics, and economic policy. The approaches to economics represented include the Austrianschool, McCloskey's "rhetoric" approach, Marxian critical theory and institutionalism. (shrink)
Frédéric Bastiat was a member of the French liberal school, which thoroughly dominated economics in France from the beginning of the nineteenth century until the 1880’s and continued to exert a strong intellectual influence right up to the eve of World War One. He was neither the school’s founder, nor its most profound theorist, nor even the most consistent defender of the laissez-faire implications of its economic theories. He was however the most gifted expositor of its politico-economic (...) doctrines, and as such, is the economist associated with this school whose name evokes greatest recognition among contemporary Anglo-American economists. Thus I refer to “Bastiat’s school” In an earlier article, I detailed the profound influence that the French liberal school had on the development of nineteenth-century economic theory not only in France and other Continental countries, particularly Italy, Germany and Austria, but also in the United States, Great Britain and Australia. (Salerno 1988, pp. 113-56). In this article, I also criticized the attempts of a number of economists who were conversant with, if not sympathetic to, the French liberal school, including Joseph Schumpeter, Karl Pribram, and Peter Groenewegen, to explain its almost complete neglect by Anglo-American economists and historians of thought after World War One. Their explanations boiled down to three main claims. First, the leaders of the school succeeding its founder J.-B. (shrink)
The image of economics got somewhat puzzling after the crisis of 2008. Many economists now doubt that economics is able to provide answers to some of its core questions. The crisis was not so fun for economics. However, this not so fun image of economics is not the only image in the eyes of the general public. When one looks at economics-made-fun (EMF) books (e.g. Freakonomics, The Undercover Economist, etc.), economics seems to be an (...) explanatory science which is able to provide interesting, unconventional, entertaining and enlightening explanations for almost every aspect of our lives. Isn't there a great contradiction between these two images of economics? Not necessarily. The present paper explicates why. Nevertheless, the paper also shows that EMF books run the risk of creating a false sense of understanding and explains how one should read the basic insights provided by EMF books to remove this risk. The paper contrasts the EMF version of the explanation of the effects of mandatory seat belt laws with actual research concerning the subject to illustrate its arguments. (shrink)
This is an assessment of two recent philosophical accounts of the nature of economics, those given in Alexander Rosenberg's Economics - Mathematical Politics or the Science of Diminishing Returns? (1992) and in Daniel Hausman's The Inexact and Separate Science of Economics (1992). The focus is on how they portray the predictive capabilities of economics and the links between economic theory and empirical evidence. Some major suggestions of the two books are found wanting in interesting ways. Examples (...) are Rosenberg's explanation of the predictive weakness of economics in terms of its folk psychological roots and his depiction of economics as a branch of political philosophy and applied mathematics; and Hausman's claim that the ?economists? deductive method? is appropriate while ?economics as a separate science? is not. (shrink)
The influence of economics, the most imperialistic of the social science disciplines, is widely thought to have been felt more decisively in political science than in any other discipline. After briefly reviewing some evidence that this alleged influence is not transmitted through the use of specific economics concepts, this paper explores the possibility that the influence instead stems from the importation of formal rational choice modeling techniques from economics into political science. This is carried out using a (...) case study of an important political science literature on voting behavior and the voter turnout puzzle. The analysis produces what seems compelling evidence for the importation of economics-oriented analytical methods into the political science literature on voting. (shrink)
While acknowledging the successes of modern economics, this paper concentrates on some shortcomings. Many are traced to a single source: the great insights of economics are all qualitative. Economics does not have a theoretical structure that is tightly related to a rich body of data and those seeking to contribute to its ideas operate on widely divergent levels of theoretical and empirical sophistication with little communication between those who operate at different levels. One consequence is that anomalies (...) are tolerated on a scale that would be scandalous in any natural science. Another is that theories tend to be developed in unconstrained ways that are empirically relevant only by accident. Elegant error is often preferred to messy truth. Theoretical tractability is often preferred to empirical relevance. Economists often prefer theories that produce unambiguous policy results over theories that do not, irrespective of their relative evidential bases. (shrink)
In 1964, Buchanan wrote an article in which he criticized the definition of economics given by Robbins in his Essay on the Nature and Significance of Economic Science. This article is remarkable because it represents Buchanan's attempts to redefine economics, that is, not only to propose his own definition but also to attack the standard, Robbins, definition of the discipline. More precisely, Buchanan thus offers a catallactic criticism of Robbins' definition. The purpose of this paper is to present (...) and discuss Buchanan's criticism and to show how he organizes the presentation of his own definition. (shrink)
In a series of articles later collected in his book The Lost Art of Economics, David Colander argues that the dichotomous distinction of positive and normative economics has misled economists into treating applied policy economics as part of positive economics and hence adopting the methodology of positive economics for applied policy analysis. Colander therefore urges a reintroduction of the art of economics and calls for a serious discussion on the appropriate methodology for applied policy (...) work. This paper first explores some points not thoroughly examined by Colander in his arguments regarding the art of economics, in particular on its scope and the nature of judgements in the art of economics. It then examines the potential challenges to the tripartite division of economics, the presupposition of Colander's arguments for the art of economics, by examining, respectively, Tony Lawson's and Daniel Hausman's discussion on positive economics as a separate body of knowledge. (shrink)
Many economic problems are also ethical problems: should we value economic equality? how much should we care about preserving the environment? how should medical resources be divided between saving life and enhancing life? This book examines some of the practical issues that lie between economics and ethics, and shows how utility theory can contribute to ethics. John Broome's work has, unusually, combined sophisticated economic and philosophical expertise, and Ethics Out of Economics brings together some of his most important (...) essays, augmented with a new introduction. The first group of essays deals with the relation between preference and value, the second with various questions about the formal structure of good, and the concluding section with the value of life. This work is of interest and importance for both economists and philosophers, and shows powerfully how economic methods can contribute to moral philosophy. (shrink)
The Oxford Handbook of Philosophy of Economics is a cutting-edge reference work to philosophical issues in the practice of economics. It is motivated by the view that there is more to economics than general equilibrium theory, and that the philosophy of economics should reflect the diversity of activities and topics that currently occupy economists. Contributions in the Handbook are thus closely tied to ongoing theoretical and empirical concerns in economics. Contributors include both philosophers of science (...) and economists. Chapters fall into three general categories: received views in philosophy of economics, ongoing controversies in microeconomics, and issues in modeling, macroeconomics, and development. Specific topics include methodology, game theory, experimental economics, behavioral economics, neuroeconomics, computational economics, data mining, interpersonal comparisons of utility, measurement of welfare and well being, growth theory and development, and microfoundations of macroeconomics. The Oxford Handbook of Philosophy of Economics is a groundbreaking reference like no other in its field. It is a central resource for those wishing to learn about the philosophy of economics, and for those who actively engage in the discipline, from advanced undergraduates to professional philosophers, economists, and historians. (shrink)
Feminist economists have demonstrated that interrogating hierarchies based on gender, ethnicity, class and nation results in an economics that is biased and more faithful to empirical evidence than are mainstream accounts. This rigorous and comprehensive book examines many of the central philosophical questions and themes in feminist economics including: · History of economics · Feminist science studies · Identity and agency · Caring labor · Postcolonialism and postmodernism With contributions from such leading figures as Nancy Folbre, Julie (...) Nelson and Sandra Harding, Toward a Feminist Theory of Economics looks set to become the book on feminist economics for some time to come and will be greatly appreciated by all those interested in gender studies, economic methodology and social theory. (shrink)
In launching modern economics, Adam Smith paved the way for laissez-faire capitalism, Marxism, and contemporary social science. This book scrutinizes Smith's disparagement of politics and religion to illuminate the subtlety of his rhetoric, the depth of his thought, and the ultimate shortcomings of his project. The author analyzes Smith's ideas on government, justice, human psychology, and international relations, stressing Smith's efforts to elevate wealth at the expense of citizenship and to replace normative political philosophy with historical theorizing and empirical (...) modeling that emphasize economic causes. The book also provides the most comprehensive interpretation available of Smith's views on religion, examining the discrepancies between The Wealth of Nations and The Theory of Moral Sentiments. The concluding chapter appraises the demise of communism in light of the Marxian emancipation of economics from politics and religion. (shrink)
The Philosophy of Economics is the first work to seriously and successfully bridge twentieth-century economics and twentieth-century philosophy. Subroto Roy draws these two disciplines together and examines the basic intellectual roots of economics. This is also the first work by an economist to employ the writings of Wittgenstein and to tackle seriously the import of modern philosophy for economic thought. Unlike others in the field, Roy discusses not only the contributions of Popper, Kuhn, and Lakatos but also (...) those of Frege, Moore, and Wittgenstein, as well as Plato and Aristotle. (shrink)
The beliefs of economists are not solely determined by empirical evidence in direct relation to the theories and models they hold. Economists hold 'ontological presuppositions', fundamental ideas about the nature of being which direct their thinking about economic behaviour. In this volume, leading philosophers and economists examine these hidden presuppositions, searching for a 'world view' of economics. What properties are attributed to human individuals in economic theories, and which are excluded? Does economic man exist? Do markets have an essence? (...) Do macroeconomic aggregates exist? Is the economy a mechanism, the functioning of which is governed by a limited set of distinct causes? What are the methodological implications of different ontological starting points? This collection, which establishes economic ontology as a coordinated field of study, will be of great value to economists and philosophers of social sciences. (shrink)
This paper adds a moral angle to the pluralist approach to development economics, exploring the normative assumptions found in all the five main schools of thought that have analysed India's rural labour markets (neoclassical, new institutionalist, Marxist political economy, formalized political economy and feminist). The theorizations that are used by each have normative overtones, which are distinguished here from normative undertones (i.e. elements of meaning that have an affect component). Regression analysis in this literature is used to illustrate the (...) types of undertones that are present. The undertones tend to cause performative contradictions for authors who claim value neutrality. The various moral reasoning strategies available for meta?normative economic research do not offer easy solutions. However they convincingly support the case for openness to a plurality of approaches to research in development economics. Further research on normative overtones is warranted. JEL Classifications: B5, O17, O12, O53. (shrink)
Economics and culture are in a complex, developing relation to each other. Yet, to introduce ?culture? into economic theory requires, first of all, an appropriate understanding of culture itself. The crucial point of this paper is that culture in its development and structure is only understandable if one considers it in connection with the autonomous structural development of the forms with which the subjects experience and construct their world. In recognition of the socio?cultural organization of human society, there is (...) no absolute autonomy of individuals in comparison to society and economics, while together with this interdependency the development of rationality exceeds mere instrumentality. Through ontogenesis, every individual is located ?within the boundaries of society?. What are consequences for economic theory? First of all: Economics is a cultural science in a double sense. Its object is the changing world of economic phenomena that are bound in a very specific cultural context. However, culture is not only relevant for the phenomena of socio?economic life, but also for the phenomena of economic science, i.e. for the development of economic thought. (shrink)
The main arguments currently held for and against the use of self-reports in economics are presented in their relation to well-known events in the history of the discipline: the ?measurement without theory?, the ?full-cost?, and the ?economic expectations? controversies. Doing so, the paper highlights the so far neglected role of George Katona's behavioral economics in these methodological discussions.
The serious side of the Economics Made Fun genre stems from its mantra that people respond to incentives. As Levitt and Dubner put it, economists typically believe they can solve virtually all problems by designing a proper incentive scheme. What is not always sufficiently appreciated is that Levitt and Dubner argue that economists nowadays grant the existence of social and moral incentives, besides the standard economic ones. A glance at the relevant literature in academic economics confirms this. Although (...) there is an ongoing debate in academic economics about the necessity and desirability of introducing social preferences in utility functions and also about the relative strengths of various sorts of preferences, economists increasingly take the existence of various sorts of incentives and motivations into account. The recognition of non-monetary incentives and of non-economic motivation makes the economic approach to policy making more comprehensive and flexible. But since there might be various kinds of interaction effects between different sorts of incentives and different sorts of motivations, it also vastly complicates devising optimal policy schemes. What Levitt and Dubner say almost in passing about the ?strange nature? of incentives also reflects the present state of art in academic economics: while it is increasingly acknowledged that different sorts of incentives and different sorts of motivations might interact in various ways, little is still known about when, under what conditions, the one or the other interaction effect obtains. Yet knowledge of the latter is required to devise optimal incentive schemes. Thus even though Levitt and Dubner might be right that economists are quite confident that they can solve virtually all problems by devising optimal incentive schemes, it seems the limited understanding of incentives, motivations and their various interaction effects in present-day academic economics falls short of bolstering this confidence. (shrink)
Austrianeconomics - the school of thought associated with Carl Menger, Frederick von Weiser, Eugen von Bohm-Bawerk, and in this century, Ludwig von Mises, Friedrich Hayek, Murray N. Rothbard, and Israel Kirzner - is based on a framework of methodological principles and assumptions much at variance with those of traditional or 'orthodox' economists. Robert Nozick, in his 'On Austrian Methodology', focuses attention on the most fundamental features of this framework, and subjects them to a thoroughgoing and (...) scathing analysis. Singled out for detailed and critical review are: (1) the praxeological concepts of methodological individualism; (2) the claim that economics is an a priori science of human action; (3) the nature of preference and its relation to choice and action; and (4) the assumptions of time-preference theory. Although Nozick does not consider Austrian views on business cycles, market process analysis, the coordinative and informational effects of the price system, competition, and several other fundamental aspects of praxeology, his criticism strikes at the very root of the praxeological school. This paper attempts to refute each criticism made of the praxeological school by Nozick on a point-by-point basis. It thus follows the same pattern as the original paper, and scrutinizes in detail the arguments made by its author. (shrink)
Over the years, a number of interpreters with an interest in economics have given some attention the work of Alfred Schutz. As intimated in this literature, the orientation of his delimited thought on economics stemmed from contacts with the Austrianschool during his Vienna years. Probably because of this connection, there exists among these interpreters an inclination uncritically to align Schutz with the Austrians' thought. What will be argued in this paper is that in adopting such (...) an uncritical position, each of these readings fails adequately to situate Schutz's critique of economic analyses within the framework of his own social theory. It will become apparent that his treatment of economics turned out to be a mixture of defence and critique, and that his interpretation of the subject and the intellectual status he ascribed to it were considerably more ambivalent and ambiguous than has been noticed. In particular, Schutz expressed significant reservations about the highly circumscribed and artificial depictions of the world of human action that some economists espoused, especially within the confines of marginalist theory. When arraigned against the phenomenology of the life-world that he had developed, and against the "postulates" around which he had constructed his social theory, much of extant economics did not meet the requirements of a properly grounded social science. (shrink)
The paper discusses the sense in which the changes undergone by normative economics in the twentieth century can be said to be progressive. A simple criterion is proposed to decide whether a sequence of normative theories is progressive. This criterion is put to use on the historical transition from the new welfare economics to social choice theory. The paper reconstructs this classic case, and eventually concludes that the latter theory was progressive compared with the former. It also briefly (...) comments on the recent developments in normative economics and their connection with the previous two stages. (Published Online April 18 2006) Footnotes1 This paper suspersedes an earlier one entitled “Is There Progress in Normative Economics?” (Mongin 2002). I thank the organizers of the Fourth ESHET Conference (Graz 2000) for the opportunity they gave me to lecture on this topic. Thanks are also due to J. Alexander, K. Arrow, A. Bird, R. Bradley, M. Dascal, W. Gaertner, N. Gravel, D. Hausman, B. Hill, C. Howson, N. McClennen, A. Trannoy, J. Weymark, J. Worrall, two annonymous referees of this journal, and especially the editor M. Fleurbaey, for helpful comments. The editor's suggestions contributed to determine the final orientation of the paper. The author is grateful to the LSE and the Lachmann Foundation for their support at the time when he was writing the initial version. (shrink)
This paper presents the history of the Frankfurt School’s inclusion of normative concerns in social science research programs during the period 1930-1955. After examining the relevant methodology, I present a model of how such a program could look today. I argue that such an approach is both valuable to contemporary social science programs and overlooked by current philosophers and social scientists.
This article aims at showing the need for a sound ethical and anthropological foundation of economics and business, and argues the importance of a correct understanding of human values and human nature for the sake of economics and of businesses themselves. It is suggested that the ethical-anthropological side of economics and business can be grasped by taking Aristotle’s virtue ethics and Amartya Sen’s capability approach (CA) as major reference points. We hold that an “Aristotelian economics of (...) virtues”, connected with the CA’s notion of human richness, can promote the shift to the concept of personhood, and can lead to a more “humanized” business, by fostering human flourishing, the enhancement of human capabilities, and the pursuit of a more humane development for each and every person. (shrink)
Abstract This paper argues that history of economics has a fruitful, underappreciated role to play in the development of economics, especially when understood as a policy science. This goes against the grain of the last half century during which economics, which has undergone a formal revolution, has distanced itself from its `literary' past and practices precisely with the aim to be a more successful policy science. The paper motivates the thesis by identifying and distinguishing four kinds of (...) reflexivity in economics. The main thesis of this paper is that because these forms of reflexivity are not eliminable, the history of economics must play a constitutive role in economics (and graduate education within economics). An assumption that I clarify in this paper is that the history of economics ought to be part of the subject matter studied by economics when they are interested in policy science. Even if one does not accept the conclusion, the fourfold classification of reflexivity might hold independent interest. The paper is divided in two parts. First, by reflecting on the writings of George Stigler, Paul Samuelson, George and Milton Friedman, I offer a stylized historical introduction to and conceptualization of the themes of this paper. In particular, I identify various historically influential arguments and strategies that reduced the role of history of economics within the economics discipline. In it I also canvass six arguments that try to capture the cost to economics (understood as a science) for sidelining the history of economics from within the discipline. A sub-text of the introduction is that for contingent reasons, post World War II economics evolved into a policy science. Second, by drawing on the work of Kenneth Boulding, in particular, George Soros, Thomas Merton, Gordon Tullock, I distinguish between four species of reflexivity. These are used to then strengthen the argument for the constitutive role of the history of economics within the economics profession. In particular, I argue that so-called Kuhn-losses are especially pernicious when faced with policy choices under so-called Knightian uncertainty. (shrink)
The “School of Names” ming jia ) is the traditional Chinese label for a diverse group of Warring States (479-221 B.C.) thinkers who shared an interest in language, disputation, and metaphysics. They were notorious for logic-chopping, purportedly idle conceptual puzzles, and paradoxes such as “Today go to Yue but arrive yesterday” and “A white horse is not a horse.” Because reflection on language in ancient China centered on “names”.
Dreams were a topic of study even in ancient times, and they are a special spiritual phenomenon. Generations of literati have defined the meaning of dreams in their own way, while Zhu Xi was perhaps the most outstanding one among them. He made profound explanations of dreams from aspects such as the relationship between dreams and the principles li and qi , the relationship between dreams and the state of the heart, and the relationship (...) between dreams and an individual’s moral improvement. He summarized previous generations’ understanding of dreams and infused a new dimension from the School of Principles, pointing out a direction for individuals’ moral cultivation and spiritual pursuit. Zhu Xi also examined the opinions of Zhang Zai, Cheng Yi, Hu Hong and other thinkers on Confucius not dreaming of Duke Zhou in his later years, revealing differences between thinkers in the School of Principles. An analysis of Zhu Xi’s thoughts on dreams will provide deeper insight into the research on the School of Principles. (shrink)
This paper sketches the contemporary turn in philosophy of science and discusses its practical implications for doing philosophy of economics. This turn consists basically of regarding philosophy of science as itself an empirical (social) science. It thus embodies a naturalized epistemology. Some of the circularities inherent in such an epistemology are examined, and it is argued that they are not vicious. Although an empirical approach to the philosophy of science is defended, it is pointed out that there are practical (...) difficulties employing it when studying a discipline like economics in which dispute and controversy are so pervasive. It is argued that the implications of the empirical approach to philosophy of science for day-to-day philosophical practice are undramatic. (shrink)
Now that complex Agent-Based Models and computer simulations spread over economics and social sciences - as in most sciences of complex systems -, epistemological puzzles (re)emerge. We introduce new epistemological concepts so as to show to what extent authors are right when they focus on some empirical, instrumental or conceptual significance of their model or simulation. By distinguishing between models and simulations, between types of models, between types of computer simulations and between types of empiricity obtained through a simulation, (...) section 2 gives the possibility to understand more precisely - and then to justify - the diversity of the epistemological positions presented in section 1. Our final claim is that careful attention to the multiplicity of the denotational powers of symbols at stake in complex models and computer simulations is necessary to determine, in each case, their proper epistemic status and credibility. (shrink)
Economists are still very much in the grip of both operationalism and a reverence for classical mechanics as the science to emulate. Those who have exposed the weaknesses of this approach tend also to dismiss neo-classical economics as devoid of empirical and/or ideological-free content, a move which seems to have been counter-productive. This paper attempts to follow up on the more modest assessment of economics put forth by Allan Gibbard and Hal Varian. Their perspective on economic models suggests (...) that economists might better establish the scientific status of their discipline by adopting the Hempelian case for history. (shrink)
The best representatives of the self-reflection of xinxue 心学 (the School of Mind) and its development during the Ming and Qing Dynasties are the three masters from the late Ming Dynasty. The overall tendency is to shake off the internal constraints of the School of Mind by studying the Confucian classics and history. During the Qing Dynasty, Dai Zhen had attempted to set up a theoretical system based on Confucian classics and history, offering a theoretical foundation for a (...) new academic movement that gradually suspended issues studied by the School of Mind. But the suspension of these issues does not mean they were resolved. For Peng Shaosheng, xinzong 心宗 (the Doctrine of Mind) has emerged from a bottleneck in the development of the Confucian yi li zhi xue 义理之学 (doctrine of meanings and principles): The only way to find the transcendent connection between the doctrine of meanings and principles and the Dao was through the internality of belief. In this case, the Lay Buddhists, represented by Peng Shaosheng, Wang Dashen and Luo Yougao, as lixue biepai 理学别派 (Alternative School of Principles), played the role that the School of Mind had undertaken in the late Ming Dynasty, thus becoming a shelter for the Confucian doctrine of meanings and principles. To a certain extent, the revival of weishixue 唯识学 (the Consciousness-Only School) during modern times was simply a continuance of the “Alternative School of Principles”. It took over the Lay Buddhist theme of the doctrine of meanings and principles of the Qing Dynasty and tried to construct a new pattern of learning for Confucian classics that matched up with the doctrine of meanings and principles, offering a model of integration for the reconstruction of the Confucian tradition. (shrink)
Hausman has argued that Mill in the Logic demands verification of qualified, inexact statements if they are to be considered lawlike. This puts Mill in line with a reasonable interpretation of what modern microeconomists are about, but requires the additional hypothesis that Mill abandoned his earlier stress on modal truth in his 1836 essay on the method of economics. The paper maintains that neither textual nor contextual evidence supports this hypothesis. Moreover, it is superfluous if one attends carefully (...) to how Mill conceived economic science, which occupied a peculiar, somewhat isolated place in his own views on the deductive method and on verification. (shrink)
The concept of equilibrium has long been a focus for dissent between orthodox and heterodox schools of thought in economics. The paper explores the meanings of ‘equilibrium’ and attempts to tease apart salient appropriate and inappropriate modes of deployment of the concept. Under far-from-equilibrium conditions, equilibrium is not even an approximate description of the condition of the system, but an abstraction – a state of affairs which might obtain should a process under consideration run to its conclusion. The order (...) of the system is viewed from this standpoint, not as an equilibrium, but as a temporary and ephemeral balance of forces, destined to be disturbed by the passage of time. A specific instance of the deployment of the concept of equilibrium by a neoclassical writer – Robert Lucas – is examined and the conclusion drawn that the concept has been hypostatised: an aspect of a process has been one-sidedly emphasised and substituted for the whole. The temporary is made permanent, and process subordinated to stasis, with clear apologetic results. The paper concludes by suggesting that this hypostatisation exemplifies the contrast between formal and dialectical modes of thought, and that it is in the application of a dialectical notion of equilibrium that the heterodoxy can make its most telling contribution. (shrink)
Summary Methodological disputes in economics have been with us since Mill and Senior fought over the nature of economic science in the first half of the 19th Century. Progress has been extremely slow, and there is good reason for this as the present essay hopes to show.
This special issue collects papers presented at the EIPE Conference ?Economics Made Fun in the Face of the Economic Crisis? held on 10?11 December 2010 in Rotterdam. The central theme of the conference was the tension between the bold claim in Economics Made Fun books that economics can explain the hidden side of everything and the apparent failure of economics to foresee, let alone prevent the financial crisis. Economics is understandably unpopular as a subject because (...) of the financial crisis, and yet the popular appetite for economics seems only to have increased in recent years. In this Introduction to the special issue I want to explore some reasons that might explain this paradox. (shrink)
Business and Marketing ethics have come to the forefront in recent years. While consumers have been surveyed regarding their perceptions of ethical business and marketing practices, research has been minimal with regard to their ethical beliefs and ideologies. In addition, no study has examined the ethical beliefs of Austrian consumers even though Austria maintains a unique status of political neutrality, nonalignment, stability, economic prosperity and geographical proximity to the East- and West-European countries. This research investigates the relationship between Machiavellianism, (...) ethical ideology and ethical beliefs of Austrian consumers. The results indicate that Austrian consumers are mostly situationists who, while rejecting moral rules, judge the ethics of a behavior by the consequences and outcomes of the situation. (shrink)
This paper aims to show that, throughout the history of economics, an increasingly wide gap has developed between the rationality principle, usually considered as the fundamental principle of economic science, and the notion of rationality that progressively became a standard component of any model of modern microeconomics. This claim is illustrated through an analysis of the various ways in which ?rationality? was understood from classical economics to contemporary debates where axioms such as transitivity and independence, which contemporary economists (...) associate with the notion of rationality, are subjected to a number of devastating critiques. Another claim of this paper is that, while these critiques put the modern notion of rationality seriously into question, they leave the rationality principle undamaged since they were typically made in the name of that principle. It concludes with an argument emphasising the underestimated importance of the rationality principle for economics. (shrink)
This paper compares two aspects of the use of ?fun? within the economics profession. It analyzes the way in which a recently emerged genre of economics-made-fun uses fun and surprising insights to reach new audiences. And it also analyzes the way in which humor is used within and from outside the economics profession to criticize certain practices and characteristics of economists. It argues that the economics-made-fun genre, ?Freakonomics? being the prime example, not only redefines the domain (...) of economics, as is widely acknowledged, but also changes the identity of economists. In a similar way, humor is used by both insiders and outsiders to (re)define the appropriate identity and domain of economists. It draws on recent work in the history of science which distinguishes between various professional identities of scientists, such as the quirky genius and the intuitive and playful amateur. We argue that Levitt and other authors within this new genre redefine the identity of economists toward this latter type. On the other hand, humor is often used by critics of this economistic outlook on life to show the limitations of this perspective and to delineate its appropriate domain. (shrink)
The methodological debate between Frank Knight and Terence Hutchison is usually framed in terms of the philosophical debates between positivism and intuitionism, or between empirical knowledge and theoretical knowledge. Hutchison's argument was, after all, a defense of the need for empirically-based economic knowledge, using the justificatory framework provided by logical positivism, and Knight was widely known for his defense of the understanding of economic theory often associated with Lionel Robbins. But the dispute between Knight and Hutchison was much more than (...) a battle over the epistemological status of economics' basic postulates. For Knight, Hutchison's positivism posed risks for the discussion at the heart of liberal democracy. Hutchison, also, aimed his methodological criticism of economic theory at a similar target: the economic objectives of all societies would be achieved sooner if planners were guided by an empirical economic science. (shrink)
The literature of an economics of science exists in a dismal no-(wo)man's-land located somewhere between economics, history, philosophy, policy, sociology and science. Perhaps it would have continued in this tenuous quasi-existence indefinitely, were it not for a series of trends that now seem to be encouraging the institution of a subfield within the profession of economics devoted to the topic. However, many of the economists who have begun to proclaim the existence of the new subfield have generally (...) done so by starting from scratch, striving to think through the relevant problem settings and proposed solutions with little attention paid to the alternative communities mentioned above, building ?models? of science generally unrecognizable to those outside of mainstream economics. The goal of this paper is to provide the requisite materials for advancing the emerging field of economics of science by discussing the various approaches in a systematic, comparative and integrative manner. (shrink)
Abstract The study focused on investigating how Nigerian adolescents respond to Bronfenbrenner's and Kohlberg's moral dilemmas. Ninety Hausa Muslim adolescents (60 boys and 30 girls), studying in a day and two boarding secondary schools in Kano City took part in the inquiry. It was found that the subjects tended to resolve Bronfenbrenner's dilemmas in an adult?approved direction. The results also showed that day school pupils? moral reasoning was more advanced than that of boarding school pupils, and subjects? socio?economic (...) background and sex did not relate to the ways they resolved the moral dilemmas. (shrink)
The article suggests a list of principles that guide this new genre of popular writing in and on economics: the new kiosk economics of everything. These well-selling books seek to show how the simple ideas of economics are able to reveal hidden mechanisms that unify a surprising variety of everyday phenomena and by doing so entertain their readers and improve the public image of economics. It is also argued that there is a special limited sense in (...) which this qualifies as scientific imperialism. (shrink)
Recent work such as Steven Levitt's Freakonomics has prompted economic methodologists to reevaluate the state of relations between economics and its neighboring disciplines. Although this emerging literature on ?economics imperialism? has its merits, the positions advanced within it have been remarkably divergent: some have argued that economics imperialism is a fiction; others that it is a fact attributable to the triumph of neoclassical economics; and yet others that the era of economics imperialism is over. We (...) believe the confusion results in part from a lack of historical understanding about the nature and aims of economics imperialists. We seek to improve historical understanding by focusing on the activities of a cadre of economists at the epicenter of economics imperialism, the University of Chicago. These activities ? led, in the first instance, by Aaron Director and, in the second, by George Stigler ? stemmed from the effort to forge a new liberalism or a ?neoliberalism.? We then consider Steven Levitt's Freakonomics in light of the insights gained from our historical study. Our analysis leads us to question each of the three positions on economics imperialism held by economic methodologists. (shrink)
Do economists accept absurd and unsupported claims about reality, and if so, why? We define four types of claims commonly made in economics that require different types of evidence, and show examples of each from the rational addiction literature. Claims about real world causal mechanisms and welfare effects seem poorly supported. A survey mailed to all researchers with peer-reviewed work on rational addiction theory provides some evidence that criteria for evaluating claims of pure theory and statistical prediction are (...) better understood than those needed for claims of causality or welfare analysis. We suggest that unsupported claims about real world causality or welfare may be accepted in parts of economics provided they derive from a formally correct model consistent with certain types of (often aggregate) data. The rational addiction literature illustrates that this can lead to absurd and unjustified claims being made and accepted in even highly-ranked journals. (shrink)
In the natural sciences there is a general consensus on the epistemic value conferred by the participation of the ?material world? in the experimental process of knowledge production. This is no different in experimental economics. However, an inquiry into the epistemic role of the ?materials? of economics is still underdeveloped. The present paper is meant as a contribution to this inquiry. Two categories of experiments are identified according to the differentiated role of the ?materials? of economics. It (...) is argued that the crucial ?material? of technological experiments is the market institution that is tailored in the laboratory to accomplish specific purposes. The crucial ?material? of behavioral experiments is instead the participation of the experimental subjects in the production of knowledge of individual and collective behavior. FCC spectrum auctions and ultimatum game experiments illustrate technological and behavioral experiments, respectively. General policy implications are also drawn from each kind of experiment. (shrink)
Economic development and growth are driven by the emergence of new technologies, new products and services, new institutions, new policies, and so on. Important though it is, the emergence of novelty is not well understood. Epistemological and methodological problems make it a difficult research topic. They imply a ?bound of unknowledge? (Shackle) for economic theorizing wherever novelty occurs in economic life. To make progress, this paper takes stock of the problems. The methodological consequences for causal explanations and the modelling of (...)economics dynamics are discussed, and some possibilities for positively theorizing about novelty are outlined. (shrink)
Economics today cannot predict the likely outcome of specific events any better than it could in the time of Adam Smith. This is Alexander Rosenberg's controversial challenge to the scientific status of economics. Rosenberg explains that the defining characteristic of any science is predictive improvability--the capacity to create more precise forecasts by evaluating the success of earlier predictions--and he forcefully argues that because economics has not been able to increase its predictive power for over two centuries, it (...) is not a science. (shrink)
John Stuart Mill regards economics as an inexact and separate science which employs a deductive method. This paper analyzes and restates Mill's views and considers whether they help one to understand philosophical peculiarities of contemporary microeconomic theory. The author concludes that it is philosophically enlightening to interpret microeconomics as an inexact and separate science, but that Mill's notion of a deductive method has only a little to contribute.
PART ONE The Evolutionary Metaphors in the Reconstruction of Economics The indiscriminate application of the term 'evolution' however, has led to some ...
Notwithstanding the question of whether abortion is generally or exceptionally a legitimate means of family planning, it is basically agreed that abortion is not justifiable without free and informed consent of the pregnant woman. However, if abortion is held by the legislature to be a ground of justification (i.e., a far-reaching exception to criminal liability), is it true that abortion may also be carried out for the benefit of a pregnant woman who is not able to give free and informed (...) consent? Should a substituted-judgment approach be applied in cases where the woman is incompetent to decide? Or should the pregnant womans relatives interests be taken into account exclusively? The author tries to answer these questions, which were tackled by the Austrian Supreme Court in a recent case. (shrink)
