The alternative is to make honesty and humility prerequisites for membership in the community of economists. The easy part is to challenge the pretenders. The hard part is to say no when government officials look to economists for an answer to a normative question. Scientific authority never conveys moral authority. No economist has a privileged insight into questions of right and wrong, and none deserves a special say in fundamental decisions about how society should operate. Economists who argue otherwise and exert undue influence in public debates about right and wrong should be exposed for what they are: frauds.
This is the last paragraph of a long article by recent Nobel Prize winning economist Paul Romer. The article is “The Dismal Kingdom,” Foreign Affairs, March/April 2020.
Notice that he doesn’t say simply that economists who don’t share his belief in the role of economists are wrong. If he did, we could have that discussion. No. Romer goes further, claiming that people who disagree with him on this issue are frauds. Robin Hanson challenges Romer on this, I think quite effectively. Robin writes:
Look, people quite often express “moral” opinions that are combinations of simple moral intuitions together with intuitions about how social systems work. If they are mistaken about that second part, and if we can gain separate estimates on their moral intuitions, then economic analysis has the potential to produce superior combinations.
This is exactly what exactly what economists try to do when applying value of life estimates, and this can also be done regarding deregulation. The key point is that when people act on their moral intuitions, then we can use their actions to estimate their morals, and thus include their moral weights in our analysis.
Here’s how I would put it: when you think clearly about tradeoffs, you often do have more insight into normative issues than people who don’t think clearly about tradeoffs.
This is not the first time that Romer has called out people in the economics profession for views that differ from his own. He did it in the 2015 American Economic Review Papers and Proceedings with an article titled “Mathiness in the Theory of Economic Growth.” In that piece, Romer doesn’t call for drumming people out of the profession. But he does dismiss their ideas in an insulting way by claiming that one of them, Joan Robinson, “was engaged in academic politics.”
And what was her sin? “[S]he waged her campaign against capital and the aggregate production function.” Now, you don’t have to work hard to convince me that Joan Robinson’s almost Communistic political views were bad. If you doubt that, read my biography of her in The Concise Encyclopedia of Economics, particularly the part about her views on Mao Zedong’s China and Kim Il Sung’s North Korea. But that’s not what’s at issue here. What’s at issue, or, more accurately, what should be at issue, is whether Robinson had a legitimate point. But Romer doesn’t get to that. He avoids the issue by attributing, without any evidence, her different views to her academic politics.
And it turns out that Joan Robinson was right! Here’s what I wrote on that issue in her bio:
In 1954 Robinson’s article “The Production Function and the Theory of Capital” started what came to be called the Cambridge controversy. Robinson attacked the idea that capital can be measured and aggregated. This became the position in Cambridge, England. Across the Atlantic, Paul Samuelson and Robert Solow defended the by-then traditional neoclassical view that capital can be aggregated. Robinson won the battle. As historian Mark Blaug puts it, Samuelson made a “declaration of unconditional surrender.” Yet most economists still think that aggregating capital is useful and continue to do it anyway.
But you won’t get that impression from reading Romer’s piece.
Indeed, he ends the “Mathiness” piece with the following flourish:
Where would we be now if Robert Solow’s math had been swamped by Joan Robinson’s mathiness?
I’ll tell you where we would likely be: much further along in the the theory of growth.
Let’s go back to the first sentence I quoted from Romer’s piece in Foreign Affairs:
The alternative is to make honesty and humility prerequisites for membership in the community of economists.
I agree with the honesty part. That should be pretty much a prerequisite for membership in any community, not just the community of economists.
I’m not sure about humility. I’ll tell you someone else who doesn’t seem so sure of it: Paul Romer. Read his “Mathiness” piece and his Foreign Affairs piece and see if you think he shows a lot of humility.
Here, by the way, is my bio of Romer.
READER COMMENTS
Phil H
Feb 17 2020 at 11:49pm
I agree with DH’s principle here – academic freedom is very precious, and academics should be free to argue any position they can justify without prejudgment. However, the Robinson example does seem like it might support Romer’s concept of mathiness. If Robinson was mathematically correct, and yet “most economists still think that aggregating capital is useful,” then surely it’s a good example of where overreliance on maths breaks down for economics?
Mark Z
Feb 18 2020 at 4:26am
On the humility point: assuming humility is a good thing, I don’t think humility is what Romer is arguing for. For him, it seems to mean being cautious about straying too far from some presumed neutral position (which for him isn’t even the status quo, but apparently is the 1950s). He sees the proponent of deregulation as rash in assuming tearing down regulations is optimal, and presumptuous in his imposition of his own values on everyone; but the deregulationist can just as easily (IMO, more easily, but I won’t argue that point) accuse whoever imposed the regulations in the first place of being rash and imposing their values on everyone else. Epistemological humility would entail being less certain about the superiority of one’s position relative to all others. It doesn’t entail deference to some specific reference point. In fact, Romer’s exaltation of the supposed pre-deregulation era he favors as a privileged reference point which we ought to defer to absent overwhelming evidence isn’t humble at all.
Alan Goldhammer
Feb 18 2020 at 7:45am
Maybe Romer is engaged in a polemical argument. Is this any different from Krugman’s ‘attack of Zombie ideas?’
Thaomas
Feb 18 2020 at 8:31am
Pace Romer, I can’t think of many cases in which economists (not counting politicians who half remember their Econ 101) have exerted “undue” influence on public policy. And I’m pretty sure governments officials have NEVER “looked to” economists for answers to normative questions. But if economists do claim privileged insight into questions of right and wrong on their basis of their expertise, they are indeed frauds.
The Capital controversy is just the index number problem in other guise. There is not perfect way to aggregate prices and yet economists and politicians continue to do so. So what?
How does Henderson know “we” wold be farther along on a theory of growth without the Solow model?
Jon Murphy
Feb 18 2020 at 8:44am
Is that not what you do when you advocate for a revenue-neutral carbon tax? If you are not claiming privileged insight (in this particular case, the insight that a higher tax, at a certain level, can reduce carbon emissions to a socially optimal point), then on what basis do you make your claims?
There is nothing fraudulent about an expert giving an expert opinion. Fraud comes in when the expert knowingly misrepresents either the precision of his opinion or opposing ideas.
Thaomas
Feb 18 2020 at 12:59pm
No. It’s my personal opinion. And it’s an opinion about how to arrive at a number which could in principle result in the number you favor, zero.
Jon Murphy
Feb 18 2020 at 1:46pm
Right. And what is your opinion based on?
Thaomas
Feb 21 2020 at 8:29am
An absolute right to my own personal equity/efficiency trade off for which I do not claim on the basis of my expertise as an economist. THAT would be fraudulent and on that I agree with Romer. I just don’t see professional economists (as opposed to politicians claiming expertise on the basis of their mis-remembered Econ 101 courses) doing that.
RPLong
Feb 18 2020 at 9:08am
Henderson never claimed that “‘we’ would be farther along on a theory of growth without the Solow model.”
He said that we would likely be further along in the theory of growth if, as Romer stated, “Solow’s math had been swamped by Joan Robinson’s mathiness.”
The way economics works is that old models are developed, and then new work, new theories, and new developments improve on our old understanding. It’s possible for both Solow and Robinson to have had good, important ideas. It’s possible for an old idea to have furthered our understanding of economics even if that idea is eventually rejected in favor of a newer, better one.
Thaomas
Feb 18 2020 at 10:36am
Why does Henderson think that likely?
Jon Murphy
Feb 18 2020 at 11:11am
What’s one car plus one factory plus one computer equal?
Comments are closed.