Falleneconomist: An economist who has forgotten how to do math
I was introduced to this term while attending a lecture by a visiting professor at UC Davis. It struck me that many of the insights that most excited me could not be formulated into an equation, and in a sense economics today can be seen as an attempt to formulate every phenomenon within a mathematical model. An idea that seems almost Quixotic. The danger is that there are many who cheer us on as we tilt at windmills, hoping that we will be able to warn them to run for cover when the weather changes.
There is no substitute for the rigour of mathematics, but there are those instances where it may not be efficient, as when using callipers to measure the coastline. But it is not the mathematics that is the problem, economists would be infinitely poorer and less able without it. It is not that we translate real world phenomena into greek symbols and then translate them back hoping to find that all has not been lost in translation. It is that we choose to find relevant only that which can be thus translated.
The most central tenet is an implicit faith in the institution of the market system. The most dominant belief is that interfering with it spells disaster. And yet the rationale behind this comes from a book written 246 years ago that contains virtually no mathematics, and has been widely misread (or not read at all).
There are some who believe economics is a behavioural study, an interaction between individuals and institutions. The Sveridges Riksbank Prize in Economics for 2009, often referred to as the Economics Nobel was handed to Elinor Ostrom and Oliver E. Williamson, the former a professor of political science, the latter a specialist in institutional economics. In the aftermath of the Global Financial Crisis, students had begun to question whether economics as a discipline was fit for purpose, and a new generation of scholars are injecting a much needed diversity of thought and of methodological approach – though the tendency has been to label these interventions heterodox. Hopefully you will find something to spark your interest whether you consider yourself a mainstream economist or heterodox, or indeed not part of the economics tribe at all. Maybe there is space for a pluralistic faith.
I began this Blog a decade ago, and abandoned it when I found myself posting only sporadically. Welcome, whether you have been here before or are here for the first time.