“I sent the club a wire stating, PLEASE ACCEPT MY RESIGNATION. I DON’T WANT TO BELONG TO ANY CLUB THAT WILL ACCEPT ME AS A MEMBER” – Groucho Marx

I think that a lot of us are uncomfortable with the tag ‘social science’. The word ‘social’ seems to qualify our particular form of study, as if to say it is a lesser science, a runner-up, almost like a consolation prize. Unlike the physical sciences we are not a ‘science’. But we try to be.

It could be this very desire to be classified and perceived as a true science that causes us to mistake ‘beauty for truth’ as Paul Krugman put it. What defines a science is not its subject but its method. We use Calculus and the Hamilton-Jacobi-Bellman equation, is that not scientific enough, one might ask? And yet in profession we have most in common with the coroner, performing post mortems with speed and agility, but floundering when it comes to diagnostics. One could argue that while science began with Thales and Pythagoras 2700 years ago, economics is a much newer form of enquiry, and it will take some time before our analytical tools are as precise. But we stand on the shoulders of giants, as Newton did. In fact Newton is one such colossus upon whose shoulders we stand. Are we facing in the right direction?

The Arthashastra, a text on statecraft, economic policy and military strategy dates back to the 4th century BCE, but economic theory or what was called ‘political economy’ may be said to have arrived with the Physiocrats. Francois Quesnay’s ‘Tableau economique’ predates Smith’s magnum opus, and had a huge impact on his thinking. And we see in Quesnay and Smith, through Malthus, Ricardo and Marx, a sense of history and an attempt to view human economic behavior within the context of socio-political realities. They were confounded in an attempt to construct a ‘theory of value’ that defined human labour as the basic unit. Some would say Marx’s greatest failure was the inability to solve the transformation problem, which would have allowed us to transform value into prices.

While engineers can sleep peacefully knowing that the platinum-iridium bar which defines our conception of a standard meter lies safe and immutable at the Bureau International des Poids et Mesures in Sevres, and chemists knowing that one mole of a substance will always contain 6.0221415 times 10 raised to the power of 23 atoms, economists have no standard unit. Piero Sraffa addressed this while refuting the neoclassical school. He pointed out the flaws in our conception of capital, and introduced a new definition that was based on the classical theory of labour value. The Cambridge controversy was the most compelling debate of the time, but it has become an interesting footnote rather than a point of departure.

William Stanley Jevons’ eponymous revolution also referred to as the ‘marginalist’ revolution whisked us away from supply side theory and delivered us to a magical world of intersecting curves and equilibria three decades before the onset of the 20th century. The price we paid was a loss of texture. The marginal became mainstream.