How economists argue

15 September, 2015 at 17:17 | Posted in Economics | 2 Comments

Reality-Check-1024x682To a mainstream economist, theory means model, and model means ideas expressed in mathematical form. In learning how to “think like an economist,” students learn certain critical concepts and models, ideas which typically are taught initially through simple mathematical analyses. These models, students learn, are theory. In more advanced courses, economic theories are presented in more mathematically elaborate models. Mainstream economists believe proper models – good models – take a recognizable form: presentation in equations, with mathematically expressed definitions, assumptions, and theoretical developments clearly laid out. Students also learn how economists argue. They learn that the legitimate way to argue is with models and econometrically constructed forms of evidence …

Because all models are incomplete, students also learn that no model is perfect. Indeed, students learn that it is bad manners to engage in excessive questioning of simplifying assumptions. Claiming that a model is deficient is a minor feat – presumably anyone can do that. What is really valued is coming up with a better model, a better theory. And so, goes the accumulated wisdom of properly taught economists, those who criticize without coming up with better models are only pedestrian snipers.



  1. It’s bizarre. I think though a lot of people a long time ago gave up on mainstream economists. Too many people feel they are banging their heads against a wall. How do you deal with this type of mentality? These are basically people who hate philosophy, critical reasoning or anything remotely literate. I once attended one of Skidelsky’s lectures in London, and he said that Keynes was the only economist who really challenged the orthodoxy, but even he, ultimately failed. That was after a major event – the Great Depression. 2008 should have also been the end of this stuff. Sargent et al should have been asked to resign their positions. Yet these guys with their tenured positions remain in place (and of course they themselves don’t have to worry about involuntary unemployment).

  2. Beat me! An invitation nobody can refuse
    Comment on Nanikore on ‘How economists argue’
    In the intro Diana Strassman gives a correct self-description of what Feynman called cargo cult science: “They’re doing everything right. The form is perfect. … But it doesn’t work.”*
    Frankly, everybody knows now that orthodox model bricolage is simply a ridiculous exercise. It is a waste of time even to criticize this stuff. “The moral of the story is simply this: it takes a new theory, and not just the destructive exposure of assumptions or the collection of new facts, to beat an old theory.” (Blaug, 1998, p. 703)
    So, simply replace, or help to replace, the defective orthodox models with a superior paradigm (2014) and, for heaven’s sake, let all these sitcom arguers and losers stay behind the curve.
    What more do you need? Here is your personal invitation: “What is really valued is coming up with a better model, a better theory.” (See intro)
    Egmont Kakarot-Handtke
    Blaug, M. (1998). Economic Theory in Retrospect. Cambridge: Cambridge University Press, 5th edition.
    Kakarot-Handtke, E. (2014). Economics for Economists. SSRN Working Paper
    Series, 2517242: 1–29. URL
    *See Wikipedia

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