History of Economics Playground

A blog by young and restless (and good looking) historians of economics

Archive for the ‘Our profession’ Category

We are moving the playground – come join us

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Some time ago we got an e-mail from the guys at the Institute for New Economic Thinking (INET) asking if we were interested in shifting our playground in their direction?  Well, as of Sunday we have moved our swings and slides to the brand new ineteconomics.org/blog/playground.

New shiny home, same Kids

So what does that mean? First off we intend to continue in the same vein and in keeping content control we think not much is changing… As usual, new young and restless (and good looking) historians will join as others move on, so the only change is if you are using RSS feeds, then you will need to update it. Other than that, it’s the same playground – only shinier.

OK, so it’s a lot shinier. In April – as you’ll know – they agreed to ship us to the INET conference, and our shiny badges means we  get interviews with people who we would not otherwise bump into. We’ve also been given a video editor who is working on the interview films which will be ready soon! Then they asked if we would be interested in covering the history related INET grants and presentations, meaning travel money and hopefully interesting blog posts. Reality is that we’d be reading this stuff anyway, but somehow INET agreed to fund our trips – I fear they missed our reservation price of zero. That said, we may have missed their reservation price too, as part of the deal includes a $25,000 grant to pay for research, travel and other work related to the blog and history, so expect more archival stories and maybe even a comic. All-in-all, we think this is a great opportunity, and if it all goes haywire, we’ll always have this spot.

So on behalf of everyone, I hope you like where we are taking this, and that you’ll join us. I noticed that Pedro and Yann have already started posting over on ineteconomics.org/blog/playground, so please, come over and play.

Written by Benjamin

21 June 2011 at 10:09 pm

These things take time

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Last week, I spent a few days in the Dalton-Brand Research Room, at Duke University, skimming through the Samuelson papers. They make everybody excited there, and for good reasons. Samuelson was all over the place for about 70 years: in the academia, in the medias, in the arcane secrets of governmental policies. As a result, some of his papers read as mystery novels. There are many different plots intertwined there and you just want to read the end of the story – okay, I might be exaggerating a bit, but you get the idea. Of course, when one sees this kind of materials, he has many ideas for future papers and want to have them written – and published – as soon as possible. Accordingly, the Samuelson papers seem to generate a very competitive market. There will be a roundtable on “the prospects of writing on Paul Samuelson” at the next HES meeting, (at least) two biographical projects are being undertaken at the moment, and of course, there is also the perspective of the 2013 HOPE conference on MIT, which will hopefully result in a lot of new fascinating contributions, not only on Samuelson but on the many other important economists who interacted in this place where a lot of what constitutes the economists’ workaday toolbox has allegedly originated. There is this sensation that things will come out rather quickly but also an uneasy feeling of misplaced haste and pressure. Of course, I am not blaming anyone: that feeling has gotten all over me as well!

Yet, it is not without an afterthought that, soon after my return to Paris, I grabbed the copy of Robert Leonard’s Von Neumann, Morgenstern, and the Creation of Game Theory: From Chess to Social Science, 1900-1960 that I had ordered from my university’s library and which had finally arrived on shelf during my absence. Leonard’s book has been expected  for over a decade and it fully delivers on its promises. It does not rely on a forced grand narrative or on an overly repeated thesis. Instead, it is constructed  like an impressionistic picture, where individual paths and the larger context are subtly intertwined until they finally make sense to the reader. Robert Leonard is never where you expect him to be. When one anticipates pages on abstract formalism, Leonard depicts Chess games and the politics of Red Vienna, when one sees a critique of neoclassical economics, he describes a theory of social interaction and when one thinks of wartime reorganization of science and its aftermath, he tells the ending of a very personal journey. It is meticulously crafted, with an economy of words that makes every sentence necessary. Obviously, these things take time.

Written by Yann

5 May 2011 at 8:12 pm

Inside Economics

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Charles Ferguson’s Inside Job forces us to fundamentally rethink the connections between economics and policy making. This entangled relation runs along a number of dimension. First there is the performativity of economics: in which ways do economic theories shape the ideas of policy makers and hence the policies they enact (i.e. the Donald MacKenzie story)? Are economists and their rational market hypothesis, CAPM models and what have you responsible for the deregulation that led to the recent financial turmoil? If so, how should economics and its relation to policy making be reorganized institutionally? Second, is it at all possible to be politically and ideologically value-free as an economist? If so, how do we distinguish a value-free economist or economic theory from value-laden ones? If not, should economists always state their ideological points of view in the first disclaimer-footnote of their papers? Are there other ways to sufficiently disentangle ideology from science? Third, should economists be allowed to be paid by the private sector for their academic work? Do we need an economic code of ethics or some other kind of formal arrangement to distinguish more clearly between academic credibility and financial gain?


Luckily, we economists need not figure this out all by ourselves. In fact, the last few years have seen a surge of books discussing the role of science in the contemporary for-profit world. Gaye Tuchman’s Wannabe U (2009) tells the story of the middle ranked university that aspires to become an elite university in an age of auditing and ranking in which universities are run by business men in business suits.  Yet, although the undertone is clearly critical, Wannabe U first of all is a careful and engaging ethnographic reconstruction of the archetypical Western university that had to transform itself in the 1990s from a public institution to a private enterprise. Moreover, it reads like a novel. 

The different contributions to Harold Kincaid, John Dupré and Alison Wylie’s Value-Free Science? (2007) discuss the topic from a philosophical and theoretical point of view. The basic message is that the old fact-value distinction cannot be maintained. To some extent, that is an almost trivial point. The more important argument, therefore, is that although at some level we all know that the fact-value distinction cannot be maintained, we constantly act as if it does. That, the authors argue, is a fault of contemporary society that needs to be cured. Scientists should make clear how facts and values mingle in their work, politicians should not be allowed to rely on “objective facts,” and moral convictions should never be argued to be based on values alone. Yet, convincing as the book is, it is somewhat unfortunate that the authors do not translate their calls for action into concrete measures.     

Theodore Brown’s Imperfect Oracle (2009) is the book of a distinguished chemist, successful university administrator, and well-informed reader of sociology and philosophy who towards the end of a long career reflects on the waning authority of science. The key premise is that with all the problems the world currently faces, there is so much science could offer. Yet public opinion accepts less and less of science and scientists. Thus, the central question Brown addresses is how to restore the authority of science. This book should perhaps be read not so much as a deep or new account of the place of science in contemporary society, but rather as a well-written intellectual autobiography of one of those scientists who ruled the universities in the post war decades.  

In contrast to these three general accounts, the different contributions to Hans Radder’s The Commodification of Academic Research (2010) seek to investigate the topic from the bottom up. The book provides detailed accounts of the politics and economics of patents on academic research, the management of data , and the different sources and consequences of financial interests in academic research. Sometimes, the authors force themselves somewhat unnecessarily to infer more general claims about science, private enterprise, or autonomy. But the chapters offer enough in simply describing the different elements of corporate science.  

To save the economic discipline it would certainly help when all economists would read Kincaid’s Value-Free Science?. But before answering the bigger questions of whether economics should have a code of ethics, and how universities and research should be funded and organized, we would perhaps do good to first understand the system itself. What would most help the discussion now are detailed sociological, economic and historical accounts of how the economic discipline, economic departments, and economists function and have functioned. Both in the bygone days of the public university and authoritative science, and in the contemporary era of auditing, ranking, financial interests and business suits. Much like Tuchman’s Wannabe U or Radder’s Commodification perhaps. By chance, that happens to be what I’m doing and I’m willing to offer my expertise. Who gives me grant? I’m (still) quite cheap.

Written by Floris

20 April 2011 at 5:41 pm

INET and reforming economic education: can history help?

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One INET project is to “reconnect the teaching of economics with the working of the actual economy,” which is to begin with a reform of the undergraduate curriculum. For this purpose, a two-legged task force was established, with Robert Skidelsky chairing the British committee and Perry Mehrling the American one. Both committees reported on their progress at the Bretton Woods conference (see the videos of the sessions)

The purpose here is not to discuss the task force’s proposals. Nor is it to argue for the reintegration of history of economics to the curriculum. Some historians and economists alike have repeatedly advocated such reform since the current crisis broke out. The only problem being that the “history” economists have in mind doesn’t seem to be the “history” historians are writing. But I shall elaborate on this in future posts.

My concern is that, while I have something to say about reforming economic education as a former student and a teacher, I’m not sure what my contribution could be as a historian – assuming that economists need historical insights to devise their reforms.

Perry Mehrling began his Bretton Woods talk with the idea that “things (e.g. economic education) are the way they are for a historical reason and they stay the way they are for an institutional reason.” He then proceeded to a one-slide account of the development of american economic education as a methodological shift from the “T Ely” way of doing and teaching economics to the “Samuelson” way, before jumping to the present state of affairs and possible reforms. The task force seems to have a documented view of where we are (in the US, as well as in the UK), but very little notion of how we got there, and why. There are a few elements though that historians are – or rather, I’m afraid, should be – able to throw into the discussion.

On the idea of helping undergraduates grasp reality (with both hands, ten tentacles or a prehensile tail). What are the similarities and differences between our present situation (social and economic context, students’ demands, criticisms against the economic profession) and the crises economics have experienced over the past decades? In the seventies, for instance, introductory courses were substantially reformed in response to a demand for greater relevance emanating from students who, as it happened, remained worryingly illiterate at the end of their curriculum. This is what Jean-Baptiste Fleury relates in a recent paper on the origins of the “economics-made-fun” movement. “Relevant” meaning relevant for the then burning real world issues such as racial discrimination, the energy crisis, etc. He details economists’ reactions, from the institutionalization of the emerging field of economic education, through the creation of the Journal for Economic Education in 1969, to the decision to focus introductory courses on the application of a limited set of economic principles to relevant issues. Several textbooks illustrating this “issue-oriented approach” were published. In the eighties and nineties, professionals continued to complain that economics lacked relevance, e.g. lacked connection to observation and empiricism, and for students, lacked reference to situations of the everyday life. As the concentration of the publishing industry entailed a standardization of introductory textbook, pedagogical innovations flourished in the kind of popularization books which had already proved successful in other fields such as physics or biology. This “economics-made-fun” movement, which culminated with the publication of Freakonomics, was an inspiration for those economists who worried about the apparent decrease in the enrollment in economic major and who, by the end of the nineties, attempted to reform the curriculum again (rather unsuccessfully).

Today’s reformers may find some interest in a clear identification of what past challenges to undergraduate education and past responses have been. Though I’m not familiar with the JEE literature, I wonder whether a review of the knowledge produced in its issues would provide a sense of what the forces driving the evolution of economic education have been in the past thirty years. Finally, there’s no explicit mention of these pop-economics books in the current discussion. Is it because this literature is considered already integrated to undergraduate education? Or irrelevant?

→ One way to think about economic education is to identify the questions we want our students to answer at the end of our courses. In other words, what the appropriate exams and assignments should be like. Hence this question to historians: how did the form of econ exams evolve over time (and if you’re in a cynical mood, is economists’ claim that their science is progressive warranted, are today’s students able to answer an exam given by Marschak in the twenties, one given by Samuelson in the forties, or the tricky and much reality-based questions Friedman was used to asking in the fifties ad sixties.) A parallel set of questions deals with the practices of past education leaders, from Friedman to Solow. How did those famous economists teach? What made their success? During the INET session, Axel Leijonhufvud pointed to those economists who could not do or teach theory without history of thought, such as Jacob Viner. If there are any lectures notes in the archives, they might be worth studying.

→ Another important issue is that of textbooks/ teaching material. Some proposals have been made for the development of online material, videos, reading lists and text anthologies. And when Merhling mentions Samuelson as the one who changed the way economics was not only made but also taught, Economics pops up in our mind. Except that, as explained by Samuelson and contextualized by Yann Giraud, Economics was not written for an economic audience. In the late forties at MIT, most engineering and science students had Ec11 and Ec12 (introductory econ) on their curriculum. Made compulsory. They hated it, and Ralph Freeman, then chairman of the department of economics, asked Samuelson to write a textbook to correct this. Yann and Loïc Charles are currently investigating how, during the Great Depression, visuals such as Neurath pictorial statistics were used as a major vehicle to spread information and opinion on economics in textbooks, professional periodicals and by US administrations. Much more narratives of that kind is needed on how and why influential textbooks were written, and how they spread.

→ Finally, econ education everywhere in the Western world seems nowadays modeled on the curricula proposed by leading American econ departments, in particular MIT, Chicago and Harvard (unless you have an alternative narrative). Have historians anything to say about how economic education was developed at these leading institutions?

On Chicago, a quick search brought a much more meager harvest than I expected. A few reminiscences (for instance Deidre McCloskey’s remark that the undergraduate and graduate curricula were strictly separated), vague statements on the large number of students accepted in both programs, and on the thus large number of students failing exams. The importance of the graduate price theory course taught by Friedman, then Becker, then Friedman again, to socialize the Chicago graduate into the proper way of doing economics. Friedman as a teacher. And thanks to Ross Emmett, the role of the workshop system in ensuring that the right tools were used the right way in thesis writing and research. Fragments.

On MIT, I know a few stories. Some of which make sense to understand the current state of affairs.

At MIT, before 1965, there was no economic major. No undergraduate students in economics. Undergraduate students took 80% scientific or engineering courses, and 20% humanities courses, with a core humanities sequence during the first two years, and a major sequence in economics (or psychology, or political science, or literature or else) in the subsequent two years. A few dozens students enrolled in a course XIV, a sort of double major which allowed students to pursue a standard science or engineering curriculum AND an economic undergraduate major. 50%-50%. Three options were offered: general economics, labor relations, and quantitative economics (from statistics to Operation Research). According to the faculty reports, none of these students subsequently chose to specialize in economics. They either became engineers, OR specialists or worked for a trade union. Therefore, the curriculum economics undergraduates were presented with in the next decades, the lectures Lawrence Summers attended as an MIT student in 1973 or 1974 were designed to introduce physicists and engineers to social issues. The tools, the methods and the approach were designed for them.

The best way to get greater exposure to economics at MIT in the fifties an sixties may have been to go to the business school, where economists and business scientists were working hand in hand (they were located in the same building at the far end of the campus, away from other hard and social sciences): people at the Sloan business school were applying new methods for quality control and transportation optimization. They were obsessed with trading and they developed models to account for stock behavior. They also recruited Franco Modigliani.

At MIT in the sixties, elementary macro was taught before elementary micro. The order was reversed in 1974 when, in the context described above by Jean-Baptiste and in response to repeated students’ protests and petitions, introductory economics courses were reformed under the leadership of Peter Temin. It was decided that “micro will precede macro..so as to introduce economics through problems that are most apparent to the non economist and to the engineer in particular.”

At MIT, in the late sixties, the use of problem sets was developed. In 1968, the “Committee on the undergraduate economics program” chaired by Duncan Foley reported that :

“Students at the Institute seem to prefer subjects in which homework assignments are required to be turned in at frequent intervals. There is also some evidence that they work more consistently under such arrangement. Therefore, it seems desirable that “problem sets” be required frequently – probably every other week. Student reaction to the workbook has been negative for the most part.

It is important that these problem sets do not degenerate into routine mechanical algrebraic exercises. Some of the problem sets may well be manipulation of models, but others should be short essays on the sort of questions which are used for examination.”

Six years later, in his revision of introductory courses, Temin suggested that:

“The use of problem sets will be increased. While problems are used currently in 14.01 and 14.02, there are only a few problems sets given during each term. In the revised courses, there will be problem sets every week or two weeks. These problems will provide practice in the use of economics to analyze particular questions and an opportunity for the student to think about some of the problems raised in the readings outside of class time. They are the beginning of independent thought on economic problems.

….In general, 14.01 and 14.02 aim to introduce to the student a new way of looking at some aspects of his environment. The traditional way of accomplishing this end is through the examination of historical ideas. Considering the needs of MIT students, a different approach is suggested here. Through a sophisticated look at current economic concepts and problems, the student’s appreciation of his surroundings should be enhanced.”

I have been unable to decide how this evolution relates to Jean-Baptiste’s account of the implementation of the “issue-oriented approach.” Possibly because I don’t have the cultural background. Or because we don’t have enough material to understand exactly what these two pedagogical practices covered in the seventies.

 I don’t know any articulated account of the development of curricula at Harvard and other relevant places.

Thoughtful reforms of undergraduate education requires a knowledge of how economic education was shaped at least in the XXth century. It’s thus a pity (and a shame) that we, historians of economics, are unable to provide at least fragments of such history. Oh, but wait…. We’re busy debating -again- on “Adam Smith, the ‘Founding Father’ of Modern Economics?

Cartoon borrowed from techno converging zone blog.

Written by Beatrice

15 April 2011 at 10:39 am

When my heart skipped a beat

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I am writing a paper about an economist that was at the Treasury in the second half of the 1950s and 1960s. In 1965 a new Labour government changed the status of the economist in British policy making by creating the “Government Economic Service”, from two dozen economists working in the Treasury there were soon two hundred in all branches of government. [Alec Cairncross writing to the Lloyds Bank Review in 1970 offers an insider's and compact exposition of this change] The Public Record Office listed in its online finding aid two items by this person. Although the items would not be essential for my argument they could provide some clues and color to a formative part of his life that was less documented than his later academic career. I asked the Public Record Office for estimates of digital scans of the two documents.

A week ago I got a reply, the total: a chest constricting 2,051.20 pounds (but it includes the first DVD, not the second, that’s 5 more). In their defense, each of the documents runs over 355 pages, which I had failed to notice when I made the request. Still that is 2.80 pounds a page, in my currency: two espressos a page. The median wage in UK public sector is £554 per week, does that mean my request is a four week job? Probably it isn’t, even if you take really zealous care in the digitalization and you have a scanner running on coal. Archive and record offices are now taking digital requests but I am sure they look upon them with concern for the future. Even if it pays well it does not pay up. And it is a self-fulfilling prophecy because at these prices, I can’t afford it, no one can afford it, and it doesn’t get done.

It goes to show that doing history is an expensive business. The conventional imagination has the historian in slippers sinking in an armchair under rising piles of books. Sometimes it’s like that, if your library is wealthy enough to carry the books, or has a decent inter library loan service. Google books is great, but has so far not greatly helped the historian of the past 50 years, because of copyright laws and Google’s business model won’t have it for free. Google books most of the time compounds the problem, because it is effective at revealing additional sources that I don’t have access to. And then there are archives. They will promise you scans and copies but often asking prohibitively expensive sums. The outcome is that the historian is a nomadic species, having to bid for travel funds to visit the archives and do her work on physical copies, often with the outcome that the archive holds nothing of real interest, except the stuff for a couple of meaty footnotes. Who could have guessed history was a high-adrenaline, high-risk job?

Written by Tiago

12 April 2011 at 3:02 pm

@INET-BW: Upon leaving Mount Washington

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Who goes with Fergus?

Who will go drive with Fergus now,
And pierce the deep wood’s woven shade,                    
And dance upon the level shore?                                         
Young man, lift up your russet brow,                                            
And lift your tender eyelids, maid,                      
And brood on hopes and fear no more.
 
And no more turn aside and brood,
Upon love’s bitter mystery;                                                        
for Fergus rules the brazen cars,                   
And rules the shadows of the wood,                 
And the white breast of the dim sea                         
And all the dishevelled wandering stars. 

The place invites poetry. By the way, all sessions can be viewed from the webiste – check out in particular the last session featuring Gillian Tett of the Financial Times moderating a disucssion between Paul Volcker and George Soros.

Here’s what it all looked like through an amateur lens.

Written by Floris

11 April 2011 at 2:24 pm

@INET-BW: Who’s the iNETiest of them all?

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There are a lot of universities represented here, but who are the most likely candidates for participation and who might one expect INET to be interested in? I don’t have anything to do with INET monetas, but know that so far they have partnered with the LSE in London and Oxford University and I presume they are looking for other friends and partners in crime. Using the participant list and some nimble excel sheets, it turns out that the American North East is well represented (to be expected), and there are definetly a top ten (well, nine) coming out for new thinking:

  TOTAL Student Attendee Grantee inet board
Harvard 7 2 5 0 0
Boston 6 2 3 1 0
Columbia 6 1 3 2 0
New School 5 1 2 1 1
Balsilie int’l affairs 5 4 1 0 0
Berkeley 4 1 2 0 1
U. Mass (Amherst) 4 1 2 1 0
Central European U. 3 0 3 0 0
McGill 3 2 1 0 0

 

So it’s the local schools first, with Harvard and Boston topping, but Columbia, New School and Balsilie have a very strong presence here, with students and faculty showing up. So perhaps some potential partners are to be found in this list, it seems full of good candidates both for new economic thinking and new ideas. As for INET’s current partners, they find themselves in the ‘also rans’ with 2 representatives each. Although, you can’t say they aren’t in good company: Bard, Cambridge, Carleton, Duke, Freie (Berlin), LSE, MIT, New South Wales (Sydney), NYU, Oxford, Roosevelt, Santa Fe Inst, Stanford, UCL & UCLA.

Written by Benjamin

10 April 2011 at 8:46 pm

@INET-BW: Interview with Barry Eichengreen, any requests?

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We have been talking and video interviewing people at the conference, and we’ve narrowed down a small list of questions which we try to build on and have so far talked to Kenneth Rogoff, Brad DeLong, Ha-Joon Chang, Stephen Ziliak, Philippe Aghion, Jean-Paul Fitoussi, Barry Eichengreen and tomorrow we start with James Galbraith. Barry was really good about giving us 10 minutes after four solid hours of interviews, so we skipped the camera and did it old school while stretching our legs in direction of the drinks reception. In that spirit I thought I would share the team questions and an initial draft (hey, it’s late) of Barry’s answers. Any suggestions for whom we need to grab tomorrow or Monday?

How has your teaching changed following the 2008 crisis – have you used history more?
“I don’t so much teach history, as I do history. History has a certain utility for economists and as such it is a long existing discipline! But I teach it differently to undergraduates and postgraduates. For the former I try to give an integrated picture of the ‘world economy in the 20th century’ (which is also the title of the course). For the graduate students it is more methodology and exposing them to empirical controversies.

Which work in economics the most impressed you?”
“I would have to be less sleep deprived than I am to fully answer that question [he came in from the west coast 24 hours ago –Ben], but as I can see O’Rourke there, I would point to his book with Findlay,  Power and Plenty as a fine piece of work. Its overview and synthesis is real progress in Economic History.

How do you define progress in Economics?
“There is no single answer to this, but I worry that while we have been good at exporting our models to other social sciences, we have not been very successful on the imports front. So I think inter-disciplinarity is a key, which is why I have taken a masters degree in History and acquired a Political Science appointment.

How do you change economics?
The key is in training the next generation. There has been a disappointment I think due to the lack of radicalism after what happened in 2008, but I am not that surprised because for these things to change you need a generational change. While institutions and history may be of interest to students, senior staff members are unlikely to change what they have been doing for a very long time. But you need to train people, encourage top departments to take them and then they will be this new generation.

Written by Benjamin

10 April 2011 at 6:52 am

@INET-BW: Name Dropping and communists before INET starts

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The INET conference is not intimidating at all. It’s 8.20am, the conference has not started, we are getting on a bus to Bretton Woods from Boston, and next to me are Ha-Joon Chang and Robert Skidelsky discussing structural deficits, while Fitoussi is in front of me after we finished a quick chat about welfare measurement. Bad morning to miss coffee. Two and a half hour later we’ve not only reached Bretton Woods but I’ve reached some new ideas and debates.

Lunch got even better, at the table with Skidelsky, Christian Wigstrom (on the INET curriculum board), Richard Brock, John Kay and Duncan Foley… And the name dropping has become silly by the time we’d made it to dinner. Haven’t made an ass of myself, which is always nice. At this point the conference is yet to start. From that I have a host of things, but for now, the best quote of the day about the 1944 US Treasury chief negotiator at Bretton Woods in 1944: “This is an overstatement, but, Harry Dexter White was a communist.”  –Larry Summers, 8 April 2011. That followed a very warm recollection of Mr. White by the IMF Historian… Lovely

Written by Benjamin

9 April 2011 at 3:06 am

Posted in Economics, Our profession

Tagged with ,

Tensions

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Historians of economics and economists have a tense relationship. For various reasons. We have already seen this tension showing up in this blog, in different ways: issues of building halls of fame, the art of making interviews and using it in historical accounts, issues on the veracity of stories told, discussions about strategies of publishing,  and more recently the matter of using the past by economists and their refusal to be very informed by historical work.

We also know that the recent economic and financial crisis has resuscitated some economists like Keynes, Marx, Smith, Schumpeter, Minsky, Hayek, and others. Confidence in modern economics was shaken and criticisms were raised by prominent figures such as Krugman, among others. This made us wonder, as Beatrice wrote, whether history of economics would be seen as providing “useful knowledge for economists in a time of crisis”. Teaching of the history of economics became somewhat fashionable (mainly given the low interest it had previously). High hopes in our field, deservedly.

However, there is still a very tough issue that I am not sure how much the current crisis can change: the fact that historians of economics usually are affiliated to economics departments and are evaluated according to unfavorable rankings of journals. Recently, Daniela Parisi posted a message on the SHOE List (Feb. 24, 2011) announcing an assistant professor position at the Faculty of Economics of Università Cattolica del Sacro Cuore di Milano, Italy. When people went to check requirements and additonal information, they learned that that professorship would be assigned based on outstanding research according to a list of journals that had no history of economics journal in it. Some historians were offended and later Daniela explained that she posted that message:

Thinking of all the Italian economists working in the history of economic thought and of the historians of economic thought that have long taught economic subjects in Italy and abroad. In sending in the invitation, I thought of all those that, in reading it, would feel discriminated against. I sent it in to see the reactions the invitation would trigger…

More recently, the president of the History of Economic Thought Society of Australia (HETSA), Alex Millmow, posted a message on SHOE with a call for trying to save their journal, the History of Economics Review, from a downgrade, which would jeopardize the jobs of many historians and substantially limit the youngsters to have a chance of a decent academic life. A similar dreadful situation like this is happening elsewhere in Europe and in North-America.

Brazil is an odd country in this sense because the official ranking used by an agency of the Ministry of Education to evaluate graduate programs in different areas, including economics, has in its first category journals like AER, QJE, JPE, Econometrica, and top field journals such as HOPE and the Journal of Economic Methodology, among others. This is the product of a resistance work and it is not permanent: every three years the ranking is discussed among economists and it may change.

But the real question remains, how effective will be the crisis and the lack of confidence it brought to economics in having a permanent effect to the history of economics beyond generating demand for teachers of this subject: will it make economists more sensitive to issues of academic standards and ranking of historical work? (Of course, this question is important to the extent which historians of economics keep fighting to have positions in economics departments.)

Written by Pedro

6 April 2011 at 6:04 pm

The octopus

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The debate that began in the comment box has now moved to Brad DeLong’s Grasping Reality with All Ten Tentacles. I confess that I misjudged this affair. I thought I could jest with DeLong and I now get my comeupings, a good post by him but prefaced by a sort of character assassination that extracts the first two items of our discussion but forgets to pick up the other two (where in my humble opinion I look a bit better… and make clear my motivation is not “protecting my turf” it is calling for better scholarship). And now a lot of angry folks coming over to visit this blog ready to trash at our poor academic ethics.

I think DeLong has been very thoughtful and I relish the chance to answer him. This is not the first time that I read him on the topic. In 2008, I had noted his retelling of formative experiences with the history of economics, and the new post echoes the earlier one.

DeLong’s critique is that an historian should never dismiss the possibility that Adam Smith was offering a composite of economics, psychology and philosophy, and take a priori the alternative claim that Smith’s writings are part of that much broader unity Foucault called Episteme. I don’t see in DeLong’s post a fleshed out the argument about why one should opt for the Janus faced reading. There are a few clues, he rejects my reading as “fastpaced” (and we know “fast is bad”) and the double reading is well, twice a “fastpaced” one. On recall of his earlier 2005 post on the Episteme, I imagine that DeLong is suggesting a test on the episteme thesis. Or perhaps he is just setting up a more layered, plural set of readings, “let a thousand flowers bloom”. I think this is all reasonable.

But what if I don’t want to test the episteme? What if the history of economics is not even about “reading” and nailing down an interpretation?

DeLong’s emphasis is on “reading”, but historians of economics can do about other things too, with other records, with other questions. (As Vivienne Brown has long noted, there is an abuse of the canon in projecting upon Smith the problems of today’s social science. To no other author in economics does this happen as much as for Smith, the poor guy is cited for all kinds of conflicting purposes.) I am no Smithisian scholar, I write on the history of economics post-1945, but I have been privileged to teach the topic. In that setting I have come across some of the Smith literature, extensive as it is. Given that the subject of the working paper that started this all was the place of the economist in society (the worldly philosopher) I would have thought that a more fruitful approach would be to escape the tired debate about where Smith fits in the disciplinary grid. Is he a psychologist? A philosopher? An economist? What a tangle that is, particularly if the authors that argue that moral philosophy was then understood as part and parcel of natural philosophy are right (vide Schabas, vide New Voices), in that sense he would be a physicist too…

And does it get one anywhere? I think an historian of economics approaching this topic might do better by asking what work Smith’s text did in his society. What contexts nurtured its production and what debates it fortified and participated in? Why then not recognize that there is a whole school of political thought, the Cambridge School, Quentin Skinner, Emma Rothschild, and others that have approached Smith from the perspective of political history and seen how this work fits the pre-revolutionary debates of the Enlightenment. (This work, to which Tribe is somewhat associated too, runs into the 19th century in the work of Donald Winch, into the 20th century (this time without economists) with Stephan Collini). What made me cringe is that to look at the disciplinary grid is so far away from the issues and from an understanding of what history can contribute to the question posed.

The same is true of my other complaint that is missing from the re-posting. A reference in the Shiller’s text to the Baltimore Sun as record of the professionalization of economics. This seems to trivialize how momentous the academicization or professionalization of economics was… I would suggest the work of Mary Furner, Robert (Bob) Coats, Dorothy Ross, Ted Porter, Tim Leonard among others that have written about the Progressive Era and its formative influence on the American social sciences? And on the general topic of the profession how about reading the work of the Berkeley sociologist Marion Fourcade.

I don’t want to be writing down a reading list here, it seems inappropriate for this medium. The Shillers’ intuition that history matters for the subjects they raise is absolutely correct. Maybe they can write this history, but in the working paper they are far from it.

Written by Tiago

26 March 2011 at 1:08 am

Bad job

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Imagine I write a paper on Behavioral Macroeconomics making off the cuff observations about the latest financial products and how my bank manager frames that information, and noting my friends and neighbors’ flight to safety or to risk on the flimsiest of whims. Imagine I make no reference to secondary literature, or to methodology as I approach the questions.

Were I then to submit this piece to general appreciation, say get Robert Shiller to referee it. How do you think he would assess my effort?

I am sure we would be fast and dirty in telling me to do something else with my time.

I have not written a paper on Behavioral Macroeconomics and have no intention of doing so. But Shiller has written a working paper, kind of on the history of economics (Cowles Foundation Discussion Paper No. 1788 – Economists as Worldly Philosophers). There is no thread to the argument, no understanding of context, and zero references to the vast body of work by historians on his subject. The working paper, I am sure, will get plenty of readers, downloads and comments. But were I ever to referee it, I would be fast and dirty in telling him to do something else with his time.

Written by Tiago

21 March 2011 at 10:15 pm

Inspiration from the past

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Wandering the streets of New York I found myself at a street-side book vendor, and in picking up the Letters of the Younger Pliny I found a wonderful sentiment in the introductory quotation:

Familiar letters written by eye-witnesses, and that, without design, disclose circumstances that let us more intimately into important events, are genuine history; and as far as they go, more satisfactory than formal premeditated narratives.
-Horace Walpole to Sir John Fenn on 29 June 1784

I add to that, two definitions  from Ambrose Bierce’s Devil’s Dictionary (1906), which constitute my second purchase of the day:

History, n. An account mostly false, of events mostly unimportant, which are brought about by rulers mostly knaves, and soldiers mostly fools.

Historian, n. A broad-gauge gossip.

The wrong SHOE

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From PJ O'Rourke, Eat The Rich, p. 110

A few weeks ago, one contributor to the SHOE (Societies for the History of Economics) list asked a seemingly simple question: “Why did Marshall reverse the axes?”. In economics, indeed, supply and demand curves for a given commodity are usually drawn with prices on the vertical axis and quantities on the horizontal one. It may seem quite puzzling to undergraduate students who cannot understand why they do so, whereas prices are generally considered the independent variable and thus, according to standard practices in graphical representation at least, should be drawn on the abscissa. As another contributor quickly pointed out, the more common answer to this question is given in Mark Blaug and Peter John Lloyd’s Famous Figures and Diagrams in Economics: Marshall used to draw his demand and supply schedules this way because he considered price to be the dependent variable. As most early 20th century English-speaking economists got their economics from Marshall’s Principles, they followed this tradition, even though they rather took prices as the independent variable.

The answer, as Roger Backhouse cleverly notes, is not completely satisfying from a historical point of view, even though it may hold as a methodological explanation. A historical understanding of why Marshall reversed the axes should explore the way he and his contemporary fellow economists considered the place of geometry in mathematics, the way markets operated and more generally how they regarded the status of economics as a field. Though there might not be simple and direct answers to all these questions, one can find useful elements in the existing literature on Marshall, such as Peter Groenewegen‘s or Simon Cook‘s books.

Other contributors to the SHOE list do not seem more satisfied with Blaug and Lloyd’s answer than Roger but their reasons are diametrically opposed. One scholar, for instance, complains that common explanations refer to “tradition” or “precedent” and think there should be a more “penetrating” answer. But what is history about if it is not about the construction and persistence of  “traditions”? What is a historical explanation if it does not deal with “precedent”? Instead, most SHOE list members who contributed to the topic pursued, message after message, a non-historical line of inquiry. For them, there should be an ontological explanation to Marshall’s reversing of the axes: in other words, the answer should lie in the ‘very nature’ of supply and demand itself and of the mathematical equations that underlie their graphical representation. This is of course wrong from a historical point of view but it is also misleading because it offers a poor view of how visual representations operate. Sociologist of science Bruno Latour has argued, for instance, that two-dimensional representations are useful because they are both immutable and recombinable. We can manipulate them, superimpose them, even though they have different origins and scales. We can even merge them with geometry and use tools upon them – though we cannot measure the sun, we can measure a picture of the sun. The consequence of this is that we cannot reduce graphs to mathematical equations. Supply and demand graphs are not only visual representations of preexisting mathematical equations, they are artifacts that can be used subsequently to produce or spread economic knowledge. This is what economists do when they construct Edgeworth boxes or multiple quadrant diagrams – who complains about “axes reversing” in that case?

Furthermore, in the particular case of Marshall and his contemporaries, the idea that graphical analysis is separate from mathematics is obvious. As Judy Klein correctly pointed out:

According to Marshall, the method of diagrams should be seen as separate from the method of mathematical analysis. By the 1870s, graphs were not substitutes of equations or tables pegged, with apology at the end of a work for the mathematically illiterate; they were tools for exploring and describing phenomena that could not easily be captured by algebra, calculus or words.*

Therefore, it is an anachronism to want to explain Marshall’s use of supply and demand graphs by referring to the equations of supply and demand functions which we are used to think of as premises of these visual representations but which in fact were not viewed as such by Marshall and the likes at that time.

It is quite puzzling – and even saddening – to observe that people who deem themselves ‘historians’ of economics and as such contribute to a ‘history’ of economics list systematically choose to bypass the historian’s toolbox in their discussions.

* Klein, Judy L. (1995) The method of diagrams and the black arts of inductive economics. In Rima Ingrid (ed.) Measurement, Quantification and Economic Analysis. London, UK : Routledge, p. 113.

What would Ysidro do?

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In a 1950 paper, Paul Samuelson wrote:

The most rational man I ever met, whom I shall call Ysidro [when] told that he did not satisfy all of the v. Neumann-Morgenstern axioms, [..] replied that he thought it more rational to satisfy his preferences and let the axioms satisfy themselves.

This introduced in the extensive correspondence between Samuelson, Savage, Marschak, Baumol, and Friedman the idea of the “Ysidro Man” or “Ysidro functions.” In the letters (but not in published print) Samuelson also introduced his mother – as the non-economist acting on her  common sense. Thus, for instance, Marschak would discuss with Baumol how best to axiomatize the behavior of Samuelson’s mother.

These archetypes are more commonly labelled homo economicus and homo sapiens – very dull terms indeed (and why the Latin anyway?). So, from now on, when we talk about the homo economicus let’s instead ask: What would Ysidro do? And when criticizing that economic conception as unrealistic, let’s do that by referring to what Samuelson’s mother would do.

Written by Floris

27 February 2011 at 4:00 pm

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