Disrupting Economics?

economicsIt has become fashionable to attack and dismiss economics. In an age where the likes of Piketty can become an “authority” in the eyes of the public by writing a tome of scientifically questionable content but that says what people want to hear, it may seem like we are heading for a disruption in the study of economics. Perhaps this is a good thing, considering how economics professors at renowned institutions can get away with - and even be praised for – saying really dumb things like

Economics is a political argument. It is not – and can never be – a science; there are no objective truths in economics that can be established independently of political, and frequently moral, judgments. Therefore,… you should never believe any economist who claims to offer ‘scientific’, value-free analysis.

As Austrians, we have long claimed economics needs to do away with its ridiculous “physics envy” and study the market and economy for what they are. In this sense, we’re both ready for and welcome a disruption. But only if it entails a revolution in the right direction – toward a sound study of the real world. But tis is hardly what progressive unthinkers have in mind; they would rather replace the economic analysis of the world with empty slogans and policy.

As they often remind us, economics is but ideology – it is not science – and therefore cannot be trusted. How can they say this? Because the “Scientific Marxists” claim so. (The contradiction obviously escapes them.)

Economics can be both scientific and different from the statistical “mathturbation” it has often degenerated to. I try to summarize how and why in a recent text, The Fundamental Importance of the Trade-Off.

Comments

  1. Great piece! Certainly an important part of modern economic illiteracy is a misunderstanding of “science” as merely experimentation and empirical observation.

    One quibble with the last link: You say “If there are constants here, and one could (should?) from a non-religious point of view argue that we’re biological machines ultimately determined by the structure of the universe, we are nowhere near being able to understand them – or even measure them.”

    Strictly speaking, this is a materialist worldview, not a “non-religious” one. Religion has nothing to do with it, per se.

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