Economics-Haters

I have been picking over a friend's economics textbook this summer in preparation for a course I might have to take and I find most of your conclusions true. Economics is about making practical decisions using some scientific method. It is useful to me and also to businesses and the government. One might consider the economically sound actions of a business morally reprehensible. This I cannot argue with. Decisions that are good for business aren't always good (or tolerable) for everyone.

I am sure your communist friend harbors a strong dislike for capitalism and by extension free market economics. I am willing to give her some points in criticisms of capitalism but economics still ought to be considered.

I simply don't understand your communist friend's beliefs. How could anyone dislike the fabulous system of capitalism? After all, it's only in a capitalist marketplace that I could buy an iPhone and resell it on eBay (which I actually did) to make $55 profit (also known as arbitrage). Capitalism is the utmost exemplar of freedom? How could freedom be evil?

Economics rules.

"economics is the one social science that actually works!" is a bit closed minded.

Perhaps I am being marginally closed-minded. But have you ever looked at the state of much quantitative political science and sociology literature? In most articles, "empirical evidence" equates to a bunch of multiple linear regressions on vaguely relevant survey data, which may fail horribly to fulfill the assumptions of linear regressions. Authors also misinterpret regression frequently. That's their idea of high-tech. Some of their theory is good, to be sure, but economics is light-years ahead and it actually does generate some solid, verifiable, and true results.

I agree with Adam that economics is at a qualitative remove from other social sciences. It has a useful predictive power, which makes all the difference in the world. Anthropology, for example, does not. One could maybe cite linguistics as another well-advanced social science, but its potential utility doesn't scratch that of economics.

I think that the reason that most people dislike economics is twofold.

Firstly, as Adam points out, Economics has, in adapting empirical methods and numerical tools, taken on some of the mien of a real science. Many people dislike science, fearing it, and this is easily transferred to anything carrying its methods.

Secondly, Economics carries an irremovable connection to politics. We, from our compartmentalized 21st century vantage, like to call them separate subjects, but the dissolution of Econ from Political Science is a startlingly recent phenomenon. For most of their history, they were one: Political Economy. This is in some sense appropriate, because economic facts tend, for rational voters with reasonable goals, to direct one to specific political views.

That effect is partly about people confirming their views by seeking an appropriate economic formulation, a motivation which could realistically be ascribed to many communists, and also to the formation of views to match economic observations.

For the latter, we need only observe Mr. Neben. He observes an economic fact (Empirically, economic freedom leads to the efficient distribution of desirable goods and services to the population, and provides prosperity to clever people) and deduces a corresponding political view (Economic freedom is desirable and should be implimented).

This is all very well and good, but the linkage of political views to empirical reasoning is anathema to many people, since it again links them to scientific reasoning [i] in politics [/i]. This provides a motivation to [i] hate [/i] economics by giving disagreements there the forse of politcal debates.

A discipline whose methods I don't like (sociology, for instance) but which has no bearing on me inspires no hatred; I merely avoid it. But if people started shooting down my political views with sociologic arguments, it would be frustrating. I might easily grow to resent it. I would like to think that I personally would adopt the practice, if a rational connection existed, but many people, in the real case of economics, do not.

Look, I like economics as much as the next guy, but your arguement is that economics is better than other social sciences because of the quantitative literature is also misguided. Economics is mathematical by nature, giving individuals and firms objective "functions" (read:math). Because of this, the literature in economics is naturally quantitative. Other social sciences (sociology, anthro, psych) are not based on mathematics, so empirical studies will be of a different nature. To claim that economics is the most "well-advanced" (Ari's words) based on this flawed metric is ridiculous.

However, if we were to claim that mathematics is the ultimate discipline, which it certainly is, then yeah, economics rules.

Jon, I think you may have misread my comments. If you'll refer back to them now, you'll see that the key difference I cited in calling Economics "well-advanced" was its empirical predictive power. The mathematical methods used were not the "qualitative remove" I cited, and this should have been clear from my enumeration of Linguistics as a second example.

I know that the specific kind of predictions to be made are not of the same nature, a numerical nature, as in physics. But still, if I tell you that the government has placed a price floor on shrimp at $1 a pound, you wouldn't blink before making a firm prediction. "Run on supply. Permanent shortage." Any of us would say the same thing, and we'd be right. When Oregon passed a "price floor" on payday lending, the prediction of shortage ran loud and clear, and it was correct. Economics is predictive.

Now PoliSci is not. Say a republican candidate for runs a slightly racist ad in Virginia (just for instance). Just tell me what will happen. If it's 1988 and it's willie horton, it will work. If it's 2006 and it's [I forget who], it will not. Why? We can guess, we can argue, but we don't know. We couldn't predict it.

You can say that those kinds of knowledge, coming from a mass of often irrational human decisions, are chaotic, wild, not subject to prediction. And surely, in the cavernous expanses of time past, the stars and planets seemed the same way. Chaotic motions which exhibited some vague patterns and tantalizing uniformities, but defied description. Economic data must have once seemed the same, but we codified them. Linguistics to a much lesser degree.

I hate to cite BF Skinner, but he made an excellent point. Why do we still cite Aristotle and [nod to Adam] Plato on psychology and social science issues? Surely their knowledge is outdated, and their works are of interest for historical reasons only, as in Physics, Math, Cartology? We cite them still today, with interest and reverence, not because they touched on some eternal verities beyond which we will never probe in a discipline which is impossible to formalize, but because we have not yet advanced sufficiently. Skinner hoped to, but I contend that he failed.

I don't think the metric is flawed; predictive power is the best metric here. If you don't have it, the best you can hope to do is inspire and entertain. Worthy goals, but hardly the province for what claim to be "social sciences."

I'm sorry for being so long-winded and pompous. These kind of discussions do that to me, and combined with a medium where I can go off and write at length and consider first, I get out of hand.

While I like predictive power, and I was thinking along the same lines as Ari, Jon may have a point here. Ethnography, a method in sociology, in which the investigator lives in and intensively studies a community, has essentially no predictive power. The ethnographer basically just writes his observations and strives to explain patterns from his experience and personal interaction. By definition, this can't really generate predictions because the case studied is an entirely special one. The ethnographer isn't trying to generalize it, since he is only examining a single example.

So is ethnography less developed and useful than economics? I think it probably is, personally. It is hampered by problems of bias, lack of falsifiability of its claims, etc. But there two other considerations. First, the complexity of human interactions that ethnography studies is so complex, that it is essentially impossible to generalize. Economics just happened to pick the easier thing to study. And second, since each case is essentially unique, there is no way to falsify observations and conclusions. Again, ethnographers just happen to study something that is a lot harder than what the economists study.

So, while it may be reasonable to say that economics is more "developed" than ethnographic sociology, it does not follow that economics is better, more fruitful, or more insightful. Even if economics generates loads of predictions and ethnography gives none, it may be the case that all of economics is trivial and banal, while ethnography produces deep insights. If that were the case, ethnography would probably be "better". This is the subtly that I missed in my original post.

I like adam's analysis. We probably all like economics because it does have this very simple predictive power that can make us look smart when we talk about economic at parties. However, economics is becoming increasingly reliant on psychology and neurology research to answer questions about irrational behavior. There are many things that economics cannot predict (or rather, can predict, but predicts incorrectly) and emerging research in other sciences is helping to answer these questions. Ari, how does your analysis reconcile this?

As Adam says, I don't think you can say economics works better than other social sciences, or even make comparisons between the social sciences. Yeah, economics research gives you "answers" to important "questions", but maybe that is just because we aren't asking the right questions. Many social sciences don't even attempt to make quantitative predictions. I think we are too narrow minded about what a prediction can be. Psychology is pretty good at taking a patient with certain symptons and making a diagnosis. Some social sciences attempt to make qualitative instead of quantitative predictions.

The point is, just because economics can tell you that there is going to be a shrimp shortage, and in most cases it would be right (but in some cases it would be wrong) doesn't mean it has the best predictive power. The prediction is "trivial and banal".

All this conversation about shrimp being $1 a pound is making me hungry. Now if I could only find some of these parties Jon talks about where people care about economics...

Look, I'm not denigrating other fields; believe me, I'm not. Nowhere in my prior comments did I say Economics (Or even the real sciences!) was "better" than another subject. I don't think "better" is even defined. You could say more predictive, more useful, more amusing. I believe I said what I mean, which is that Economics is more developed, and that its predictive power puts it in a different position, and that this difference (and the connection to politics) makes people hate it.

I think that the connections of economics to Neurology and Psychology don't weaken the divide between it and, to use the trendy example, ethnography. On the contrary, Economics is rapidly becoming part of the interconnected web of predictive methods that make up our most useful and powerful tools. It's using findings from other fields to enhance its own results. Isn't that good? Botany "relies" on Biochemistry, pharmacology on kinetics, Chemistry on quantum phyisics. Does that weaken them?

You've got me with Psychology, sort of. I mean, you cite diagnosis, and how nice and consistent it is, but what do you have aside from diagnosis? Say that Mischa is diagnosed with ADHD. We say he "has ADHD" because he exhibits a series of topical symptoms, the precise same symptoms which are used to diagnose the Disorder. All we really have so far is a loose correlation between sets of symptoms.

Do we really know what causes it? No; it's like medicine before germ theory and genetics. Do we know how to really get rid of it? No; the chemical imbalance methods we use now are dangerous and impermanent. Psychology pales in comparison to real medicine, let alone the hard sciences.

I totally get what you're saying, that you don't have to be numerical to be predictive. But in many fields, they're just not at that stage. As Adam says, the findings are basically subjective judgements, either ill-defined or undisprovable. That doesn't make them bad, or even less fun, it just makes them different from economics in a way that makes the latter inspire hatred.

I'm not sure what you mean about asking the right questions. People ask all sorts of questions, but most social sciences don't help to answer them. Maybe I'm misunderstanding; can you tell me what your broader definition of "prediction" would include?

The shrimp prediction is not trivial or banal, nor are these kind of predictions as shaky as you assume. I invite you to cite counterexamples. You're faced with a diverse market of multitudinous people doing what they please for all sorts of rational and irrational reasons, buying and selling products. That I can tell you with comfortable certainty that those independent decisions will have a predictable outcome over the large scale whenever the conditions change in a certain way is not trivial.

Think about it; I can sit back and say "when all these people all independently make their own decisions with free will (maybe) and for their own reasons, all the shrimp will be gone and people will still be standing around wanting to buy some." Supply < demand. Many people would (and still do) disagree, but the prediciton I make is verifiable, and we have both a body of observation and an experimental framework to represent it.

Is it hot in Chicago and Portland? Bend is killing me.