Krugman on math and economics

22 Nov, 2018 at 00:26 | Posted in Economics | 3 Comments

Yours truly have no problem with Krugman’s views on the use of math in this video in his recent tweet. I have said similar things myself for decades.

But there is a BUT here …

At other times Krugman — although admitting that economists have a tendency to use ”excessive math” and “equate hard math with quality” — has however vehemently defended the mathematization of economics:

I’ve seen quite a lot of what economics without math and models looks like — and it’s not good.

And when it comes to modeling philosophy, Krugman has more than once defended a ‘the model is the message’ position (my italics):

I don’t mean that setting up and working out microfounded models is a waste of time. On the contrary, trying to embed your ideas in a microfounded model can be a very useful exercise — not because the microfounded model is right, or even better than an ad hoc model, but because it forces you to think harder about your assumptions, and sometimes leads to clearer thinking. In fact, I’ve had that experience several times.

For years Krugman has in more than one article criticized mainstream economics for using too much (bad) mathematics and axiomatics in their model-building endeavours. But when it comes to defending his own position on various issues he usually himself ultimately falls back on the same kind of models. In his End This Depression Now — just to take one example — Krugman maintains that although he doesn’t buy “the assumptions about rationality and markets that are embodied in many modern theoretical models, my own included,” he still find them useful “as a way of thinking through some issues carefully.” When it comes to methodology and assumptions, Krugman obviously has a lot in common with the kind of model-building he otherwise — sometimes — criticizes.

My advice to Krugman: stick with Marshall and ‘burn the math’!

3 Comments

  1. What we see in modern economics, dating back to at least Samuelson, and which includes Krugman, is a lot maths, but very little real content.

    This is no way to understand the world around us.

    Comment by Nanikore— 23 Nov, 2018 #

  2. People should skip Krugman with or without math and his models and read for exampel this one instead: Monetary Economics. An Integrated Approach to Credit,
    Money, Income, Production and Wealth
    Wynne Godley and Marc Lavoie

    Click to access Monetary%2BEconomics%2B-%2BLavoie%2BGodley.pdf

    Comment by Jan Milch— 22 Nov, 2018 #

    • Right, we should start with balance sheet models.
      .
      ” post-Keynesian economics could only offer the Sraffian
      model as a formal tool to tackle production interdependencies and relative
      prices, but which, ironically, did not and could not deal with the crucial
      Keynesian issues of output, unemployment, inflation, financial flows and
      debts.”
      .
      Output is statistically imputed and a fetish figure. Unemployment is irrelevant and fixed with basic income. Inflation is neutralized by printing money at least as fast as prices rise and distributing it equally. Financial flows are unregulatable. Debts can be forgiven by the central bank at the top of the hierarchy (the Fed). In my humble opinion 🙂

      Comment by Robert Mitchell— 24 Nov, 2018 #


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