The Origins: ‘History of Economics’ and History of Economics in Russia

This year marks the 25th anniversary of the Higher School of Economics (HSE) – the university I was affiliated with in 2000-2017, first as a student, then as a faculty member. This is a nice occasion to share some thoughts on this here because I believe this matters for the history of economics at least in two respects – 1) as a fragment in the (still largely unwritten) history of recent economics in Russia and beyond; and 2) as a view on the development of our discipline as such.

One always needs some temporal distance to judge about one’s own involvement in history – however small and insignificant (like mine) it might be. I am writing this because I feel I was given this time and I have a personal perspective to be added to the general historical narrative.

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When I entered the HSE, economics was for me, as well as for most of my fellow-students first and foremost what in German is succinctly called Brotstudium – a discipline that would be associated with something tangible, with the real occupation (unlike, say, philosophy which, as many people around me believed, was not a real ‘profession’). I was very suspicious and at first neglected most of the economics and other disciplines taught to us as simply dull and irrelevant to my ‘higher’ intellectual concerns. At the same time, I regarded my interest in humanities as a guilt, something to be ashamed of in front of my economics peers, perhaps similar to religious beliefs in the age of hard science. But I was wrong in many ways, and it is this feeling of having erred that motivated me to write this recollection.

Apart from those of my course-mates who simply needed a prestigious economics diploma in order to find a good job in industry or government, there were, of course, others who were really interested in economics and occasionally also wanted to become academics. Some of them, as I see now, did embark upon a career of an academic economist[1]. But I did not want to follow this path, I was too critical and too impatient with ‘positivist’ and pragmatic flavor of our curriculum – which was, as I now understand, extremely demanding and included the whole spectrum of applied disciplines (like corporate finance or banking, but, in fact, many more), lots of math and econometrics, several big courses in micro and macro, and many other compulsory courses (in fact, most of the courses were compulsory, this was an atavism of the Soviet educational system) – all packed into 3,5 years of training. But there was still more, and it is this ‘more’ I retrospectively see very differently.

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In the very beginning of the first academic year, the rector of the HSE, Yaroslav Kuzminov, taught us (who were at that time almost all not older than 17) a 2-months introductory course called, enigmatically, [2] ‘Economic institutions’. The starting point was the perceived deficiency of ‘neoclassical’ approach and the need for a more realistic study of economic institutions, very much along the lines of Douglass North’s famous 1990 book. It also took Herbert Simon’s idea of bounded rationality on board. Admittedly, the 2 months course did not bring us much further than clarifying the basic definitions (like the differences between institutions and organizations or the types of transaction costs), and how could it possibly be otherwise? But it did convey at least two important messages: 1. Institutions matter, and standard economics does not pay enough attention to that; 2. Neo-institutionalism, in the versions of both North and Williamson (their work, along with that of Simon, had been by then already translated into Russian), is important to understand what is happening in the Russian economy – and, generally, for making sense of a radical institutional transformation we were witnessing.

Now I understand how special it was. Apart from institutional economics (which we also had in a more advanced form later), we began our studies with a more-than-a-semester course in economic history, which was, however, more descriptive and more inspired by Wallerstein than by North; and in the third year, we had a course in the history of economic thought. This organization of curriculum reflected the way HSE conceived of training its ‘core’ students (at that time, there were few departments). I would reconstruct this implicit understanding roughly like this:

  • you have to be relevant for your country’s economic development (back in 2000, it was still the priority);
  • economic policies designed in the beginning of the 1990s, following the ‘existential’ constraints of transition and simple commandments of the Washington consensus, mostly disregarded deeper institutional and cultural dimension of the Russian economy that is currently in desperate need of ‘good’ institutions;
  • in economics community, there is an increasingly widespread perception that purely market-based, ‘neoclassical’ (or ‘neo-liberal’ – whatever this means, and may all the gods of intellectual history forgive me!) policies are insufficient both on theoretical and on pragmatic terms;
  • thus, we have to make recourse to the best alternative available – not replacing, but complementing the standard economics curriculum; and we have to do it on many levels, in order to make it clear that history and culture matter even for those who, like our economics students, are to be educated mostly ‘technically’ and/or in a very ‘business-oriented’, possibly a-theoretical way.

It took some time for me to recognize behind the diversity of courses the general idea of a) making economics education more open to other disciplines; b) making future economists more sensitive to history; and c) teaching economics (also) as a social/human science. (The last point was, admittedly, only possible at a graduate level and, as far as I know, remained for the most part a mere intention.) Moreover, by the time I myself started teaching at the HSE Kuzminov had convinced the economics department that it should dedicate still more hours to the history of economic thought, so that its share in the curriculum became enormous and comprised nearly 3 semesters (it was subsequently shortened again, but the very approach is telling).

I gradually realized that people who were the founding fathers of the HSE came from the intellectual tradition(s), that valued pluralism in economics, and could see how history and interdisciplinarity matter for economic knowledge. Kuzminov himself began his career at Moscow State University as a lecturer in the history of economic thought and economic history, who then became interested in institutionalism, property rights theory etc. Oleg Ananyin, my supervisor[3], was – and is – a professional economic methodologist and historian of economics. Vladimir Avtonomov, who was for a long time Dean of the economics department, is an historian of economics as well. Vadim Radaev, the Vice-Rector of HSE, who established new economic sociology in Russia; Natalia Makasheva, a scholar working on Keynes and Nikolai Kondratiev; Revold Entov and Rostislav Kapeliushnikov, who worked in applied economics, but considered their broad and productive engagement with the history of economic thought and methodology equally important[4]; the late Andrei Poletayev, an economist-turned-historian, who, with Irina Savelieva, created the first HSE research institute devoted solely to the human sciences; others, like Rustem Nureev, Georgii Gloveli and Leonid Grebnev, who were very sensitive to the philosophy and history of economics – all these individuals played a significant role in shaping the first curricula and generally determining the path of the HSE as an institution. Many of them contributed to a series of books (actually it should have been an annual publication) called Istoki (Origins), publishing lots of translations and original work in economic history, institutional economics, and history of economic thought; translated Schumpeter and Blaug; and co-authored the first comprehensive history of economic thought textbook in Russia. Hence, it should not be surprising that some important faculty from the younger generation, like Maria Yudkevich [5] or Alexis Belianin [6], were equally open-minded; it is also not surprising that one of the key international academics invited to cooperate with the HSE was John Nye, a well-known associate and colleague of North.

But I somehow had not understood these deeper intellectual commitments of the university till the times of my MA, when I found myself following Ananyin’s course in the philosophy of economics and discovering how fascinating economic theory was as an object of historical and methodological analysis, and how helpful my training in economics turned out to be in my philosophical work. So, after all, despite some disappointment with more standard parts of the curriculum, I still could discover opportunities – and find support – to do very inspiring things at the economics department. There was nothing to be ashamed of, there were just things one had to do well, with insight and passion.

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What is the lesson? There is no lesson here, just, perhaps, some final historical remarks. I wonder where did this academic/epistemic culture of interdisciplinary openness and, in particular, respect to the history of economics (still not typical for most economics departments) come from. And I see at least three historical reasons for this.

  1. In part, this culture was inherited from the Soviet past, when Marx and Marxism were key subjects of study and neither economic history nor history of economic thought could possibly be overlooked (after all, Marx himself was an historian of economic ideas!). In 1990s, unlike most other post-Soviet economists, HSE faculty took pains to engage with whatever type of ‘Western’ economics they found productive. The curricula were being reformed and renewed every year, they were quickly becoming very ‘standard,’ but those good scholars who had a background in Marx, could not be satisfied with the standard theoretical frame (and could not, of course, suddenly become mainstream economists).
  2. As I said before, this clearly had a certain pragmatic background. HSE curriculum reflected the dominant ideas about what a good economist must know, and ‘good economist’ mostly referred to a good expert in economic policy, whether industrial, ‘institutional’ or macroeconomic. Now, one did believe that applied disciplines and standard economics courses were not enough, one needed some other ways of conceptualizing the economy, and that is why institutional economics and economic sociology were present in our curriculum as well.
  3. Finally, those beliefs were, I presume, also of a more general kind. History of economic thought mattered for a good education in economics precisely because it demonstrated that – surprise – there was no single economic theory out there and that one could look at economic science from a completely different perspective. That is not so easy to comprehend if you’ve got a background, say, in physics, then become an MA in economics and move on to a PhD without ever taking or caring to take such courses and being sure that there is a straight line from the most recent textbooks to papers to the ‘cutting edge’ science. HSE believed that this is too narrow a vision, to be broadened by the historical engagement with economies and with economic knowledge.

Were these three reasons connected to each other? Of course they were, but I stop here and leave the rest to another occasion.

 

[1] See, e.g., here and here. However, at that time this career almost necessarily involved getting a MA at the New Economic School, the most famous example being MIT’s Andrey Malenko, by far the most successful academic economist among the HSE alumni, who studied a year later than me.

[2] The funny thing is that institut in Russian often refers to something like a college, so the course title (Ekonomicheskiye instituty) could remind us of all those ‘higher education institutions’, commercial or not, offering (mostly bad) economic training.

[3] I did not know at that time about the role Ananyin had played in Russian reforms, for he was among those few who in the early 1980s discussed the ways of radical economic transformation.

[4] Entov edited most of the translations of Western economists published in the Soviet Union, while Kapeliushnikov wrote, among other things, the first exposition of the ‘Western’ property rights economics back in 1990.

[5] Who studied institutional economics with Kuzminov in Moscow and with Olivier Favereau, Laurent Thévenot, and Claude Ménard in Paris.

[6] The student of Poletayev who, as far as I understand, supported the idea that the history of economics be taught at the ICEF – the LSE-affiliated department of the HSE where I was also teaching. I do not know the whole story, but the history of economics seems to be taught only at the LSE department of economic history, and not at the department of economics, with which ICEF was initially associated.

Hisreco 2017: no decreasing returns, yet.

20170420_180853The 11th History of Recent Economics conference (HISRECO) took place at the University of Lucerne on April 21-22, 2017. As a co-organizer of this conference, with my dear friends Pedro Duarte and Verena Halsmayer, I am not well placed to express an opinion on it. Let’s just say that we haven’t entered the period of decreasing returns yet. We had a very nice roster that included historians of economics, historians and STS scholars, and that my impression last year that the distance between those communities was decreasing has not been proven wrong. This is not to say that all the papers that were presented were perfect: they need not be, anyway. But the free-form discussions we had were as enthralling as ever. A quick summary follows.

Harro Maas (University of Lausanne) wrote on forecasting in the Netherlands, from the early postwar years of the Centraal Planbureau (CPB) to the aftermath of the 2008 crisis. He put in contrast the practices of scientific modeling and the idiosyncratic practices of the quacks. The latter were rehabilitated as the only ones who managed to predict the Great Recession.

Marion Ronca (University of Zurich) talked about Eugen Böhler, the Swiss economist, and his influence on the economic policies of his country. Converted to Keynesianism after fighting against it, Böhler was nonetheless an intellectual who did not fit into the mainstream economics of his time. At the end of his year, he used Carl Jung’s concept of mythos to criticize the discipline.

Laetitia Lenel (Humboldt University of Berlin) studied the first years of the NBER, showing that not only the methodologies used there differed from those adopted at the Cowles Commission but the views of the role of policy as well. While Koopmans and his allies’ endeavors aimed at advising the government, Mitchell and Burns were interested more in collecting facts and educating the public at large.

Sarvnaz Lotfi (Virgina Tech) provided an account of Research and Development (R&D) in the postwar period. Her project is to contrast the views of R&D as the main explanation of macroeconomic growth (following Solow’s residual) with its practical value as shown in accounting, management and law. Ultimately, there is more disparity than consensus in the way scholars and policymakers envisage the value of R&D to a nation.

Roger Backhouse (University of Birmingham) attempted to assess MIT economist Paul Samuelson’s role in influencing the economic policies of John Kennedy. Samuelson did not participate directly in policy advising, choosing instead to reflect on policy through his textbook and interventions in the press. This illustrates his cautious, even ambiguous, stance towards politics.

Cleo Chassonnery-Zaigouche (University of Lausanne) provided an alternative account of the role of economists in the courtroom,  focusing more specifically on James Gwartney’s expertise in racial and gender discrimination on the labor market. The way through which truth is assessed in the court is different from the way it is done in an academic setting, affecting the view of economics as a science in the process.

Francesco Sergi (University of Paris-Sorbonne) studied the standard, internalist, history of recent macroeconomics, that is contained in the manuals used in central banks. He argues that these narratives, which are aimed at standardizing practices, also tend to “decontest the contestation” existing in the field. In his view, new neoclassical macroeconomics – needs to be disaggregated and it is the duty of historians to bring more dissent to the discipline.

Steve Medema (University of Colorado at Denver), finally, wrote on the place of non-welfarism in the debates over the Coase theorem. While economists typically tried to exclude non-welfarist – i.e. social justice related – arguments in the postwar period, those were ubiquitous in the pieces that expressed criticism toward Coases’s idea of a market-based solution to environmental issues. Medema argues that non-welfarist arguments can be considered as proxies to ideology.

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Craufurd D. Goodwin (1935-2017)

On a sadder note, we have learnt during the first day of the conference that the great historian of economics and longtime History of Political Economy Editor Craufurd Goodwin had passed away. Goodwin’s vigorous efforts to promote the history of economics did not consist in faint discourses about the vitality of the field but, rather, in his constant allegiance to the highest possible academic standards. The mere possibility of a conference like Hisreco is a testament to the excellent scholarship his endeavor helped to encourage. He was one of the true giants of our discipline and will be greatly missed. Our condolences go to his wife, Nancy, and his friends and colleagues at the Center for the History of Political Economy at Duke University.

 

2016 as a ten-letter word

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Robert N. Proctor (Photo: Linda A. Cicero)

In the end of November, as it is the case every year since 2004, Oxford Dictionaries revealed their choice for the word of the year. For 2016, they settled on “post-truth”. This adjective, defined as “relating to or denoting circumstances in which objective facts are less influential in shaping public opinion than appeals to emotion and personal belief”, echoed a number of events of the past few months, including UK’s vote in favor of Brexit and, most infamously, the election of Donald J. Trump. Following the announcement, a few commenters were quick to observe that “post-truth” could be considered as an emanation of postmodernism, the brain-child of post-1968 French philosophy and critical theory. Whether you buy this or not – I don’t -, there’s no denying that “post-truth” has been everywhere in the press and on social networks. Yet, as a historian of science with little – if any – interest in questions of “truthfulness” and “falsity”, I would like to suggest another ten-letter word for describing more accurately what has been going on over the past few months – and, admittedly, over the past few decades as well, 2016 representing in my opinion some kind of turning point in its development. This word is: “agnotology”.

For those of you who are not familiar with the concept elaborated by Robert N. Proctor in books such as The Cancer Wars: How Politics Shapes What We Know and Don’t Know About Cancer (1995) and Golden Holocaust – Origins of the Cigarette Catastrophe and the Case for Abolition (2012), suffice to say that “agnotology” is the production and dissemination of ignorance – as well as the study of this phenomenon. Proctor’s argument in a nutshell is that knowledge is not created out of a vacuum which we would call “ignorance” but, instead, that both knowledge and ignorance are social constructs, therefore contingent to many social, political and individual factors. The production and dissemination of ignorance, therefore, can be studied using the tools that are traditionally attached to the history of science, making the distinction between science and non-science not so significant in the process. When we look at the history of how the cigarette industry intentionally spread doubts about evidences that linked smoke ingestion to cancer, there were a few scientists to back this claim. At first, I was skeptical about “agnotology” because I had read Naomi Oreskes and Erik Conway’s Merchants of Doubt, which does not use the term “agnotology” but tells a relatively similar story of ignorance dissemination, and was unsatisfied with the way they tried to demarcate between the good, disinterested scientists fighting for truth and those who were paid by big corporations to spread false information – I had expressed my dissatisfaction on the INET version of this blog. However, I do not find the same problem with Proctor’s historical narrative which is not so much interested in questions of demarcation but rather in the cultural and political context in which ignorance is produced and disseminated. Accordingly, agnotology has been used in the history of economics by Phil Mirowski and Edward Nik-Khah in a way that may seem controversial at first  but which I found, after some resistance, increasingly convincing. After all, agnotology deals with producing and distributing something, so economics should not be too far away when we think about it. Two French economists have recently tried to use Proctor’s work, without using the term ‘agnotology’, in order to build a case against the critics of mainstream economics but in my opinion – which I have expressed in a forthcoming review of their book for a French STS journal -, they fell short of understanding the complexity of the concept and, quite ironically, ended up generating a lot of agnotology over the current status of their discipline.

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Donald Trump: the rise of agnotologic governmentality?

But so much for these issues of scientific demarcation – or lack therof. “Agnotology” is an enlightening word to describe 2016 because it is effectively applicable to the political issues of the day. Ignorance production and dissemination is not something which is just relevant to scientific issues. It is actually, a total social fact in the Maussian sense of the term, one that ties together cultural, psychological and political elements. With the election of Donald Trump, I even wonder if it is not possible to assert that we are entering an age of agnotologic governmentality, a way of governing that uses ignorance as a political device. In using the term governmentality, I explicitly refer to Foucault’s Birth of Biopolitics. Governmentality, in Foucault’s conception, should not be confused with “government”. A regime of governmentality is enforced, not just by the State, but at many different levels where knowledge and power are connected. Suffice to replace knowledge by ignorance and then you have some idea of what a Foucaldian version of agnotology could look like. Since his election in November, Donald Trump has been a master in disseminating so much information, both in the press and on social networks, that it is almost impossible to assess what his legislature will yield. But of course, this had not begun with his election: this is the way he had behaved since the very beginning of his campaign at the Republican primaries. At the time, it had been summed up in one fantastically short tweet.

Now that “the comments section” has become the new President of the United States, we can argue that the kind of ignorance that such comments section typify will noy only lead  the most powerful nation, but as a result will preside over the way of the world at large. But ignorance is not a “top-down” phenomenon and that’s what makes it so stealth, yet powerful. Ignorance is cultivated at every level of the society and now, through more or less trustable internet news coverage, it is disseminated at a higher speed. Even academics and self-proclaimed “intelligent” people such as you and I can be subjected to it. If you have been a regular user of social networks in the course of the past few months, I defy you to tell me that you have never fallen into a clic-bait, believing for at least a few minutes a piece of information that has been revealed to be either false or (mis)guided by a non-objective source. The bombing of Aleppo, for instance, has been the subject of so much news coverage that it is impossible be sure that everything we were told was true. While there is no doubt that, on one hand, some information has been manipulated by pro-Syrian and Russian medias, we are not so naive as to believe that there is no propaganda on the other side, too. Increasingly complex conflicts and social issues such as this one are not easy to grasp and we can all be deceived. Effective propaganda knows how to exploit the capacity we all have to doubt. It is no surprise that agnotology is often related to neoliberalism. It is not so much, I think, that there is a mechanical relation between the two but, instead, that both are so squeezed in the recesses of our our everyday life that they are difficult to espace, unless we turn off our computers and start leading a more recluse life – which may not be a bad idea after all.

Anyway, I am afraid I have conveyed that 2016 has been a very bad year and this is similar to a lot of rants you have already read elsewhere. I should apologize for my lack of originality. But there is also a more positive message: as historians of science, we may  be able to apply our critical toolbox to the understanding of how we got there and, hopefully, how we will be able to get away with it.

On Entering the Canon: Who Wins the Nobel Memorial Prize?

Meanwhile, my department – along with some others, I suspect, – created a form for predicting the future Nobel Memorial Prize winner(s) in economics. In fact, it might be a good exercise for a sociologist of the economics profession (although a bit too narrow one).
     Who will get the Nobel? Many think of Olivier Blanchard (as Web of Science does) – and indeed, Blanchard might be easily confused with those who already got the Nobel long ago, leaving us puzzled that he is still not among them. It will be an interesting twist if Paul Romer gets the prize (recall his recent devastating critique of macroeconomics, as well as previous ones). From the older generation people like Martin Feldstein seem to be overlooked. All these scholars are known for their penchant for ‘macroeconomic’ issues  – whatever this means today (and the last ‘macroeconomic’ Prize winner was Thomas Sargent in 2011).
     Anyway, the intrigue is still present, since the result can often be unexpected (as it was the case, say, with Elinor Ostrom or could have been, for some, with Maurice Allais or James Buchanan). Current priorities, despite the fact that one gives the Prize for the work done long ago, still might play a role – thus juxtaposing the past economic science and the ever growing complexity of the present one. Multiple winners are also possible and ubiquitous, and here we might get most striking combinations interweaving times, schools and sub-disciplines. One could, for example, pull together Elhanan Helpman, Avinash Dixit and Marc Melitz as theorists of international trade, Philippe Aghion, Peter Howitt and Robert Barro as economic growth giants (oops, no Romer and too much Harvard here), or William Easterly and Robert Townsend as classics in ‘economic development’. A more  interdisciplinary – but less probable – perspective would involve Harold Demsetz and Richard Posner as ‘institutionalists’ and, of course, people like H. Peyton Young and W. Brian Arthur or Ernst Fehr (to my mind, Fehr should at some point get the Prize by all conceivable standards) or even Samuel Bowles/Herbert Gintis (with Robert Axelrod as another disciplinary counterpart to Ostrom), many of them could be also paired with the  previously nominated William Baumol or Israel Kirzner. I know much less about econometricians, perhaps those who know more could give their suggestions.
    But this is still a game. What would interest me a lot (and what, as far as I know, is only partly touched upon in the new book by Avner Offer and Gabriel Söderberg – which nonetheless should be fascinating) is the internal mechanics and tensions of the selection process, the struggles behind the nominations and their evaluation, and the techniques of compiling Nobel press releases and «scientific backgrounds». We will never learn the ’true’ story, but we have to come closer to it, because this kind of historical/sociological inquiry might be at least as instructive for understanding the dynamics of economic knowledge as the exercise in prediction.

The Tale of Three Universalisms, or How Mainstream Economics Meets Analytical Philosophy, They Both Roll Up Sleeves and Get to Work

Some time ago, in a conversation, a colleague of mine referred to John McCumber’s book «Time in the Ditch» and I saw the reference to the same book in Roy Weintraub’s recent text on McCarthyism and the mathematization of economics. This coincidence – and the fact that I had known McCumber before as an important Hegel scholar – made me look more closely at the topic I’ve been brooding about since quite a while. Yes, we know, after the work of Phil Mirowski and Sonja Amadae, that Cold war mattered for American economics in pushing it closer to the ideal of a ‘hard science.’ Well, somehow, almost simultaneously, in the beginning of the 2000s, McCumber told us that American philosophy had also been made more scientific in response to Cold war challenges. My claim here does not bear directly on Weintraub’s argument (that the influence of McCarthyism on the research practices of economists has been exaggerated and is not really supported by the evidence), but rather invites to reflect on the more general affinities between mainstream economics and analytical philosophy prompted by this historical research.

The analogies (noted once to me by Eric Schliesser and, as far as I know, never really thematized – but I would be most grateful for any references) do matter for me both historically (as parallels in what was happening in – largely Anglo-American – philosophy and economics in the last century) and systematically (in teaching us what kind of knowledge mainstream economics and analytical philosophy were and, to some extent, continue to be).

Meanwhile, along with and after McCumber’s book, a number of important studies emerged – such as Steve Fuller’s portrayal of Thomas Kuhn as a Cold warrior; George Reisch’s analysis of the formalization happening in the postwar American philosophy of science; or Joel Isaac’s detailed and fascinating story of Donald Davidson’s entanglement with Patrick Suppes and other economists and decision theorists. Philosophy, along with behavioral sciences, economics, and operations research, has thus taken its place in the thick historical narratives documenting the shift to a more applied (but not pragmatist!) and, at the same time, more formalized, rule-based, algorithmically oriented kind of knowledge. This shift involved, among many other things, the move away from humanities (broadly conceived) in search for transparent and universally comparable knowledge regime following a ‘tool shock’ (Isaac, again).

Now, is there any sense in juxtaposing analytical philosophy and mainstream economics? Apart from some obvious thematic overlaps – such as, in the case of Davidson and Suppes, value and action theory – there are general aspects worth thinking about. I would tentatively call them three universalisms and I’d abstain, on purpose, from any strict separation between internalist and externalist perspectives. Of course one can find a lot, a lot of counterexamples, but what I sketch here are just general tendencies, to be beaten only by equally general and more plausible ones. It’s not a comprehensive history, it’s a perspective that might help illuminate the history and sociology of the economics and philosophy professions.

The first kind of universalism is fairly obvious: both disciplines value universal knowledge, they clearly prefer generalizations over historical situatedness, abstraction over the entanglement into cultural contexts, and formalized reproducible truths supported by the hard data over the relativisms of interpretation. One could elaborate, but I’d just leave it here.

The second universalism is mostly rhetorical, and perhaps could be found in other disciplines, too. It consists in colonizing the words and continuously reproducing the pars pro toto trope, with certain type of economics suddenly becoming the whole of economics, with certain type of philosophy suddenly representing the whole of philosophy (even Isaac could not avoid this), and with an extremely tough and protective boundary work (see, e.g., Tiago’s important paper on that).

The third universalism consists in a democratic and inclusive nature of both communities. We know it can be a spurious effect, we know that status and prestige play a role everywhere in the academia, and still, in contrast with heterodoxy and continental philosophy very much centered around ‘big’ figures, dead or alive, we cannot ignore the salience of the collective and collaborative nature of the profession on the other side (just think of the increasing population of Daron Acemoglu’s co-authors). In mainstream economics and analytical philosophy, the thinkers and poetic geniuses make way ‘to humble, competent people, on a level with dentists,’ most problems are technical, and the solutions are near at hand. But this makes any exception, any unusual constellation, any identity shift even more interesting, both sociologically and in terms of intellectual history.

 

DARPA, the NSF and the social benefits of economics: a comment on Cowen and Tabarrok

Tyler Cowen and Alex Tabarrok have a new piece in which they ironically note that economists are surprisingly shy when it comes to applying their tools to evaluate the efficiency of the NSF economics grant program. Their target is a companion JEP article in which Robert Moffitt defends the policy-relevance of economics against the last round of attacks on NSF’s social science budget, not least Senator Coburn’s 2011 list of wasteful federal spending. Cowen and Tabarrok criticize Moffitt’s use of the econ relevance poster child, Paul Milgrom’s research, which, legend says, has brought 60 billions $ to the US government through rounds of FCC spectrum auctions. This is a typical case of crowding-out effect, they argue, since private firms like Comcast, who also saved $1,2 billion in the process, had huge incentives in funding that research program anyway. Likewise, they note, the quest to raise revenue in sponsored search auctions led Google engineers to rediscover the Vickrey-Clarke-Groves mechanism. NSF funding should thus be shifted to high social benefits programs, for instance setting up a replication journal, supporting experimental projects with high fixed costs or –here they agree with Moffitt – deploying large publicly available datasets such as the Panel Study of Income Dynamics, which was specifically targeted by Coburn.

NSF grants are also biased toward research programs with high probability of success, already well established and published in top journals, they add. Such “normal science” is hardly groundbreaking. NSF should rather emulate DARPA and fund “high risk, high gain, and far out basic research” (which could include heterodox economics). They also suggest shifting from funding grants ex ante to giving prizes ex post (DARPA’s practice), because this creates competition between ideas. If an heterodox model provides better predictions than mainstream ones, then a NSF prize would signal its superiority.

The paper is challenging and, as always with the authors, unrivalled in its clever applications of economic tools. My problem is with:

1.their romanticized picture of DARPA

2. their lack of discussion of how the public “benefits” of economic research should be defined

 1. Should the NSF emulate DARPA?

department_mad_scientists_paperback-224x300 Cowen and Tabarrok’s suggestions are predicated on the impressive record of the Defense Advanced Research Projects Agency in promoting groundbreaking research, from hypersonic planes, driverless cars and the GPS to ARPANET and onion routing. This success is usually attributed to the philosophy and structure of the secretive defense institution founded in 1958 to “prevent technological surprise like the launch of Sputnik,” and later to “create technological surprise for US enemies.” Michael Belfiore, for instance, has described a “department of mad scientists” who profess to support “high risk, high gain, and far out basic research.” This is achieved through a flexible structure in which bureaucracy and red tape are avoided and the practical objectives of each project are carefully monitored. I have only skimmed Anne Jacobsen’s recent “uncensored” history of DARPA, but so far it does not seem to differ much from Belfiore’s idyllic picture. Yet digging into the history of specific projects yields a different picture. In his account of DARPA’s failed Strategic Computing program, Alex Roland explained that while the high-risk, high-gain tradition served as the default management scheme, the machine intelligence project was supervised by no less than 8 different managers with diverging agenda. Robert Kahn, the project’s godfather, believed that research was contingent and unpredictable and wanted to navigate by technology push, whereas his colleague Robert Cooper insisted on demand pull and imagined an AI development plan oriented toward innovations he could sell. Some viewed expert systems as crucial and other dismissed it, which changed what applications could be drawn from the program.

Roland’s research exemplified the difficulty of DARPA’s officials in agreeing over a representation of the scientific, technological and innovative process that would yield maximum benefits. And benefits were to be evaluated in terms of defense strategy, which the history of Cold War science has shows was far easier than to evaluate the benefits of social programs. From cost-benefit analysis to GDP, hedonic prices, contingent valuation, VSL or public economics, the expertise economists have developed is precisely about defining, quantifying and evaluating “benefits.” But the historical record also shows each of these quantifications have been fraught with controversy, and that when it comes to defining the social benefits of their science as a whole, economists are not even struggling with quantification yet. For the last 70 years, they have been stuck with negotiating a definition of “social,” “public” or “policy” benefits consistent with the specific kind of knowledge they produce with their patrons.

2. Fighting over “policy benefits”

Moffitt’s article is only the last instantiation of a series of attempts to reconcile economists’ peculiar culture of mathematical modeling with external pressures to produce useful research, their quest for independence and their need for relevance. This required a redefinition of the terms “pure,” “applied,” “theoretical,” or “basic,” and Moffit’s prose perfectly illustrates the difficulty and ambiguity of the endeavor:

The NSF Economics program provides support to basic research, although that term differs from its common usage in economics. Economists distinguish between “pure theory” and “applied theory,” between “pure econometrics” and “applied econometrics,” and between “microeconomic theory” and “applied microeconomics,” for example. But all these fields are basic in the sense used in government research funding, for even applied research in economics often does not concern specific programs (think of the vast literature on estimating the rate of return to education, for example, or the estimation of wage elasticities of labor supply). Nevertheless, much of the “basic” research funded by NSF has indeed concerned policy issues, which is not surprising since so much of the research in the discipline in general is policy-oriented and has become more so over time. Although most of that research has been empirical, there have been significant theoretical developments in policy areas like optimal taxation, market structure and antitrust, and school choice designs, to name only three.

 For Moffitt, in other words, the nub of the funding struggle is that both theoretical and applied economics are considered “basic” by funding agencies because they are only indirectly relevant to specific policy programs. Trying to convince patrons to fund “basic” or “theoretical” research was an issue even before the NSF opened its social science division in 1960. At that time, economics’ major patron was the Ford Foundation, whose representatives insisted on funding policy-relevant research. Mathematically-oriented economists like Jacob Marschak, Tjalling Koopmans, or Herbert Simon had a hard time convincing Thomas Carroll, head of the behavioral science division, that their mathematical models were relevant.

NSF’s economic funding remained minimal throughout the 1960s, and it climbed substantialy only after the establishment of the Research Applied to National Needs (RANN) office in the early 1970s. Tiago Mata and Tom Scheiding explain that RANN funded research on social indicators, data and evaluation methods for welfare programs. It however closed in 1977 after Herbert Simon issued a report emphasizing that the applied research funded was “highly variable in quality and, on the average, not impressive.” The NSF continued to fund research in econometric forecasting, game theory, experimentation and development of longitudinal data sets, but in 1981, Reagan made plan to slash the Social Sciences NSF budget by 75%, forcing economists to spell out the social benefits of their work more clearly. Lobbying was intense and difficult. Kyu Sang Lee relates how the market organization working group, led by Stanley Reiter, singled out a recent experiment involving the Walker mechanism for allocation a public good as the most promising example of policy-relevant economic research. Lawrence Klein, Kenneth Arrow and Zvi Griliches were asked to testify before the House of Representatives. The first highlighted the benefits of his macroeconometric models for the information industry, the second explained that economic tools were badly needed at a time when rising inflation and decreasing productivity needed remedy, and the third explained that

…the motivation for such selective cuts [could only be due to] vindictiveness, ignorance and arrogance: Vindictiveness, because many of the more extreme new economic proposals have found little support among established scientists. Because they have not flocked to support them, they are perceived as being captives of liberal left-wing ideologues; Ignorance, because this is just not so. It is ironic and sad that whoever came up with these cuts does not even recognize that most of the recent ‘‘conservative’’ ideas in economics – the importance of ‘‘rational expectations’’ and the impotency of conventional macro-economic policy, the disincentive effects of various income-support programs, the magnitude of the regulatory burden, and the arguments for deregulation – all originated in, or were provided with quantitative backing by NSF supported studies. And arrogance, in the sense that those suggesting these cuts do not seem to want to know what good economic policy can or should be. They do not need more research, they know the answers.

 31r2hG8wtzL._SY344_BO1,204,203,200_Sounds familiar? The ubiquity of Al Roth’s research on kidney matching in economists’ media statements, the proliferation of books such as Better Living Through Economics, Angus Deaton’s 2011 Letter from America, the 53 proposals by economists to rethink NSF future funding, and Moffitt’s article can all be interpreted as attempts to redefine the relationship between basic, applied and policy-relevant research and to provide a framework to assess the public benefits of economic research. They all exhibit tensions between publicizing benefits, and maintaining objectivity, independence and prestige. Reconciling these contradictory goals underwrite centuries of terminological chicanery. In 1883, physicist Henry Rowland delivered a “Peal for Pure Science” in an attempt to divorce his research from the corrupting influence of money and materialism on “applied” physics. In an effort to promote both scientists’ autonomy and their ability to foster profitable industries and strategic military applications, Vannevar Bush introduced the term “basic science” into his 1945 Endless Frontier report. And this is how Moffitt ended up straddling pure, applied, basic, practical, theoretical and empirical science. Economists nevertheless might be able to cut through these debates over the “policy benefits” of their science by turning it into a battle of indicators, as they successfully did with the concepts of growth and inequality.

Bonus question that no paper on NSF econ funding addresses. How has the NBER succeeded in monitoring 15% of NSF econ grants, and what are the consequences on the shape of econ research?

CFP – HISRECO 2017 in Lucerne

city-scapeHistory of Recent Economics Conference University of Lucerne – April, 21-22 2017

The eleventh History of Recent Economics Conference (HISRECO) will be held at the University of Lucerne on April 21-22, 2017. Since 2007 HISRECO has brought together researchers from various backgrounds to study the history of economics in the postwar period. It is the organizers’ belief that this period, during which economics became one of the dominant discourses in contemporary society, is worth studying for its own sake. The increasing availability of archival materials, along with the development of new perspectives inherited from the larger history and sociology of knowledge, has helped to provide insightful histories of the development of recent economic practices, ideas, and techniques. In particular, this area of research offers good opportunities to young scholars who are interested in interdisciplinary approaches to the history of economics.

We invite researchers in all related fields to submit a paper proposal of no more than 500 words. Even though the organizers are open to a wide range of approaches to the history of economics, paper proposals that address the interface between this field and the history and sociology of science, or cultural and science studies will be particularly appreciated. Proposals should be sent electronically (as a pdf file) to Verena Halsmayer (verena [DOT] halsmayer [AT] unilu [DOT] ch) by October 14 2016. Successful applicants will be informed by November 15 2016.

Thanks to financial support from the University of Lucerne, FIPE (The Institute of Economic Research Foundation, Brazil), the European Scientific Coordination Network (GDRI, CNRS) and the KWI (Kulturwissenschaftliches Institut) Luzern, HISRECO has limited funds to partially cover travel and accommodation for up to four young scholars (PhD students or researchers who have obtained their PhD over the past two years, from July 2014 to October 2016). Young scholars should include in their proposal their current affiliation and the university and year of their PhD, if this is the case. Those needing more information about funding are welcome to approach the organizers.

For those who want to know more about HISRECO, a list of past conferences and contributors can be found at http://www.hisreco.org.

The organizers, Verena Halsmayer (University of Lucerne), Pedro Duarte (University of São Paulo), Yann Giraud (University of Cergy-Pontoise), and Joel Isaac (University of Cambridge).

How to soundtrack your perfect failed grant application?

Well, call me. I am a specialist.

There are many ways to do it. Generally your first reaction is a bit extreme, and no one does extreme like Converge.

Then, self-pity comes next. I would advise you to season it with a bit of British wit.

(Of course, if you know some pal who succeeded, you can still hum this, too!)

Then, you must find who’s responsible for your failure and that’s when you try to guess who your referees are.

But the real answer is much too obvious.

Of course, you were not alone on this grant application, so you should let your partners know about the outcome before they ask you.

So there are two possibilities, either you decide to pull yourself together, because, well, you’re a scientist, right?

Or you just let it go and move forward.

The regulation of public numbers

On the night of the Brexit referendum the “Economics in the Public Sphere” project at University College London hosted a panel discussion on the regulation of public numbers. We heard about lying with numbers, and how to choose numbers that move people. We heard about independent statisticians and shy regulators. We heard about the politics of numbers and measurement.

The speakers came from government, advocacy groups, and academia and were Mike Hughes (Royal Statistical Society); Ed Humpherson (Director General for Regulation, UK Statistics Authority); Diane Coyle (University of Manchester, author of GDP: A brief but affectionate history); Saamah Abdallah (New Economics Foundation, Programme manager on Wellbeing); Mary Morgan (London School of Economics, author of The World in the Model); Sheila Jasanoff (Harvard Kennedy School of Government, author (with Sang-Hyun Kim) of Dreamscapes of Modernity).

You can watch the whole event on youtube, here. But as a teaser I post Mary’s terrific contribution. 

Dr. Phil – or how I stopped worrying about economists and embraced neoliberalism.

mirowski_397x267At the latest History of Economics Society Meeting, I, with a number of friends and colleagues (co-bloggers Béatrice Cherrier, Till Duppe and Floris Heukelom), participated in a roundtable devoted to “the practical challenges of writing recent history”, organized and chaired by E. Roy Weintraub. On this occasion, we all gave speeches – mostly drawn from personal experiences – that addressed how writing the history of recent economics is different from doing the history of older economics and the kind of practical issues it required us to consider. Most of our talks addressed at some point or another the relation to current economics: on the one hand, writing the history of recent economics resonates with current research in the field, but on the other hand, economists can disagree – sometimes in print – with the kind of accounts that historians construct about them. So, in sum, writing on recent economics can help you being noticed by economists, but sometimes there is attention you may just want to avoid. Then, at the end of what was an interesting, if somewhat polite, discussion, Philip Mirowski intervened, saying that our talks were, in his opinion, too focused on our relation with economists, that we have no reason to fear them, that they have no interest in history whatsoever, whereas, at the same time, science studies scholars are mostly concerned with economics as a subject, because they feel that the prevalence of economic imperatives on the academia is a threat to the humanities departments in which they are located.

My feeling is that, even though Phil expressed his opinion in his own distinctively provocative way, he was right and that, on the other hand, by focusing too much on the relation between history of economics and economics, we may not be fully wrong, buJHETt still, at the very least, mistaken. For at least one part of the argument is true: economists, on the whole, are not interested in the history of their field and are not likely to be interested in it anytime soon. A bibliographic research I have undertaken over the past few years with my friend and fellow Pedro Duarte – forthcoming in the Journal of the History of Economic Thought -, focusing on the historical pieces published in major economics journal, led us to reach quite clear conclusions:

The trends we observe … seem to illustrate … [the] increasing estrangement between economists, when writing to the profession at large in their general top journals, and HET. Not only have we shown that, in contrast to the 1970s, fewer HET papers have been published recently in most of the top journals we studied, but we also demonstrated that the papers that have been published are so diverse in the methods they use and the issues they address that it is very hard to see them as a coherent whole—not to mention as part of a unified subfield. In particular, the fact that most of these articles rely not on specific tools and methodologies, but, rather, on surveys and quite general statements may have contributed to the conflation of historical investigations and literature surveys. Therefore, practicing economists themselves have become the main narrators of their past, whereas historians are less and less seen as the expert community to be properly consulted when accounts of past economics are needed. … As a result, the issues that are central to the latest developments of the history of economics … and the new tools that historians are using to address them … have yet to make their way into the mainstream literature.

51l-3HtHuvL._SX331_BO1,204,203,200_On the other hand, sociologists, historians, political scientists, and even management scholars are increasingly drawn to the history of recent economics. They do so because they feel that economics is an important part of today’s social, political and cultural environment and they want to understand it. Of course, there’s nothing new about this. Another friend and colleague of mine, Loïc Charles, has done work on 18th century economics with practicing historians, showing how economic thinking was intertwined with a lot of things happening at the time: international trade (including, most notoriously, slave trade), the colonization of the Americas, the French revolution, etc. But what is specific to the recent – postwar – period, is that economic thinking is not just mixed with other types of knowledge and practices, but increasingly,  is THE knowledge which is used as a way to ground, to legitimize all knowledge and practices. This recent move toward the economization of every aspect of our society is what researchers have come to designate as “neoliberalism”, and this is the one of the main concepts that makes the study of postwar economics a possibly interdisciplinary venture, one that has a lot of chance to attract readers and create scholarship.

For years, I have resisted this “neoliberal” narrative. I thought that neoliberalism was a complotist construction, that it was hard to pretend that a small group of Austrian economists, even helped by some well-organized think tanks, could influence society at large so as to create a culture so ubiquitous that we are all influenced by it, whether we like it or not. But now the literature on neoliberalism has attained a critical mass, and I must say that, altogether, it provides a good analysis grid of what’s happening in the world, even though we think that there is much to criticize in all of these contributions. There’s of course, Foucault’s 1979 course at the College de France, which falls short of details, but sets up the big picture, but in recent years, many other books have helped developed the neoclassical narrative: Wendy Brown’s philosophical account of how neoliberalism is detrimental to democracy, Bernard Harcourt’s assertion that neoliberalism is transforming all citizens into punishable subjects, Sonia Amadae’s claim that the neoliberal citizen and consumer is the strategic rational actor, described in non-cooperative game theory, Elizabeth Popp Berman depiction of the economization of academic science, etc. And of course there are all of Phil Miroswki’s contributions to the subject: see here, there, and everywhere.*

CSISo, is it convincing? Well, let’s take for instance Béatrice’s latest post. She talks about Paul Romer being appointed as chief economist of the World Bank. First, why should we be concerned about this? Why is it so special that there is a new chief economist whereas we do not seem to have much to say about Dr. Jim Yong Kim, who is an American (Korean-born) physician, and is the actual President of this institution? Well, maybe, it is because we feel that economic knowledge is going to be more important than medical knowledge when it comes to decide how countries need to be helped financially. That is something that the neoliberal narratives tries to explain. And what was Romer doing before he got this new position? I quote Béatrice, here: “Romer left academia to engineer a teaching and grading plateform called Aplia.” Some neoliberalism scholars have argued that this kind of platforms offer instances of the neoliberal transformation of education. And what about Béatrice’s last point on how “the replacement of McNamara and Chenery by Alden
Clausen and Anne Krueger in 1982 shifted the Bank’s philosophy toward a ‘Washington Consensus‘ consistent with Reagan’s program”? That is also the subject of many contributions to the history of neoliberalism. In fact, we now have a neoliberal narrative for everything: even TV series are subjected to it.

So, should we embrace all of it? Of course, not necessarily. These accounts are often partial and in need of qualification. Also, I am not claiming that every history about modern economics is underwritten by this neoliberal narrative. There are many other narratives to draw. But this is one strong reading of the current situation, and as such it needs to be addressed. This is also a fascinating laboratory for possible discussions between historians and sociologists of all social sciences, as well as with cultural theorists and political scientists. This is why I expect that when Pedro, Joel Isaac, Verena Halsmayer and I do the next HISRECO conference in Lucerne on April, 21-22 2017 (call for papers coming soon!!), the term “neoliberal” is going to pop up once again on several occasions.

*Not to mention the fact that even notorious neoliberal institutions have ended up acknowledging themselves.

A few reads on (and for) Paul Romer, next World Bank chief economist

A few years ago, the World Bank sounded Paul Romer to fill its chief economist position, and he was not interested. It seems that, after several lives as academic, entrepreneur and urban thinker, he is now ready to become a “global intellectual leader.”

Capture d’écran 2016-07-24 à 19.10.22As a growth economist, Romer has earned fame by making the production of knowledge endogenous. This story has been masterfully narrated by David Warsh, though commentators disagree on what exactly made Romer’s 1990 paper a tour de force. For Warsh, it was that solving the 200 year-old Adam Smith paradox. The Scottish economist had emphasized both the importance of specialization and associated increasing returns to scale (the Pin Factory) and the importance of competition to produce wealth (the Invisible Hand). Yet, increasing returns to scale act toward concentration and the gradual suppression of competition. Romer’s contribution was not merely solving the puzzle, Warsh argues, but doing so formally. The notion that knowledge was not a standard private good and could yield increasing returns to scale had been around since Arrow, Johnson or Griliches at least. But models with increasing returns were technically difficult to solve, and, Warsh points out, the internal dynamics of the discipline requires that new intuitions be formally incorporated into economic models. Romer’s idea was to model knowledge as non-rival and non-excludable. Yet, according to Joshua Gans, Romer’s pathbreaking advance wasn’t so much how he put knowledge in the production function, but rather how he closed the model with a market for intellectual property derived through demand for new goods, and markets for skilled and unskilled labor.

Romer then left academia to engineer a teaching and grading plateform called Aplia. Around 2008, he thought more deeply about ways to foster development and came up with the idea to set up charter cities : wherever existing institutions and vested interests prevented the development of economic activities, he argued, new cities should be erected on land leased to foreign powers. The governance, institutions and sets of rules of those cities are thus imported.  As Sebastian Mallaby explains, his idea stem from the study of Hong-Kong and was unsuccessfully applied to Madagascar. Charter cities were met with considerable resistance in intellectual circles (see his debate with Chris Blattman or Mallaby’s characterization of the idea as “neo-medieval and neo-colonial”), but this did not deter Romer from setting up an urban institute at NYU. Last year, frustrated that economic scholarship on growth had not converged toward a consensus, he called his former PhD advisor Robert Lucas out for using mathematics to smuggle ideological assumption in his analysis (a sin he called ‘mathiness’).

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Lauchlin Currie, Paul Romer

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flc00605
Le Corbusier’s plan for Bogota

In the post explaining his new career move, Romer writes about his attempts to build “a new academic field of inquiry based on ‘the city as a unit of analysis’” at NYU. In an interesting twist, he is joining an institution whose history shows that bringing together development and urban scholarship is nothing new.  Back in the 1940s, neither promoting growth nor managing cities were understood in terms of non-rival goods, scales, spillovers, etc. Yet both lines of thought laid at the heart of economists’ original reflection on the Bank’s strategy, as shown by the extensive research Michele Alacevich has conducted on the early years of the World Bank. In 1949, lacking the data to define a loan policy, the Bank sent Lauchlin Currie, former economic advisor to Roosevelt, to Colombia. Currie wanted a development plan that would stimulate the latent potential of specific sectors while simultaneously achieving social aims. This, he believed, could be achieved by supporting the labor-intensive housing sector in the sprawling city of Bogota. Developing a capital city district and reorganizing basic public services such as water and electricity delivery therefore laid at the heart of the Plan para Bogota he framed with Enrique Penalosa. In an attempt to gather data and expertise, Currie soon found himself working in close association with architects José Luis Sert and Paul Wiener. The latter had produced a distinct urban plan, blending Sert’s ‘organic city’ approach with the functional guidelines previously defined by Le Corbusier. The collaboration was abruptly interrupted by a coup, but at the Bank, the idea that investing in urban planning and in particular housing would foster economic and social development stuck around.

 

lecorbusierconpaulwienneryjoseplluissertenbogotfebrerode1950

 

Le Corbusier, Sert and Weiner in Bogota (1950)

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In these early years, though, being a bank lending money to individual profitable projects and being a development institution seemed irreconcilable. In the fight over the accurate way to define creditworthiness – through debt service ratio or through the ability to productively use loans to boost growth in the long term, a perspective favored by economist Paul Rosenstein-Rodan, Wall Street-trained top managers sided with the Loan Department. The project of giving social loans to improve housing conditions and city infrastructures was rejected, and the Economic Department was disbanded in 1952. A few economic advisors to the president remained, but the position had no operational responsibility and was staffed with figures who left little imprint, such as Irving Friedman. For more than a decade, Alacevich relates, the World Bank was thus estranged from development economics, which was developed in a few university bodies such as MIT’s Center for International Studies. Another hothouse for development ideas was the central and regional offices associated with the United Nations, where the likes of Gunnar Myrdal in Europe, or Raul Prebish is South America, forged theories centered on capital, investment, big push and path dependency (with a concern for institutions, learning-by-doing, already).

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Robert MacNamara and Hollis Chenery

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The Bank’s isolation ended in the mid-1960s. Faced with a stream of criticisms on the Bank’s results, newly-appointed president George Woods stated that “Gene Black [the previous president] is afraid of economists. I am not.” He reopened the Economic Department with the hope of turning the Bank into a “development agency” and of funding wider social projects. Woods’ reorientation was met with resistance, but by 1969 the department was staffed with 120 researchers and had launched projects involving, notably, Albert Hirschman. His vision was fulfilled by his successor, Robert McNamara, who dramatically increased the number and variety of loans. A cornerstone of McNamara’s  overhaul was the recrutment of development economist Hollis Chenery as advisor. Chenery adopted a long-term strategy based on the reduction of poverty, strengthened longstanding ties with the International Labor Organization and borrowed the basic needs approach from Paul Streeten’s group. Essential to McNamara’s reorientation, Alacevich notes, was also the establishment of an Urban Development Department and an Urban Poverty task group, again focused on housing. Within academia, some urban economists were also concerned with the tied between cities and development.

Capture d’écran 2016-07-24 à 19.43.07.png

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As documented by Sarah Babb, the strategy of development banks has often been aligned with the US government’s ideology. Therefore, the replacement of McNamara and Chenery by Alden Clausen and Anne Krueger in 1982 shifted the Bank’s philosophy toward a “Washington Consensus” consistent with Reagan’s program. But Chenery’s long and influential term had created some intellectual and institutional space for economists at the Bank. It  stabilized the reliance upon economic and urban approaches to development, though it is not clear to me how much cross-fertilization between the two programs there was in the 70s. It was eventually two World-Bank researchers that Romer recruited in the 2000s to build his Marron Institute of Urban Management, and Alain Bertaud and Schlomo Angel‘s résumés illustrate how differently economics and urban planning insights are waved together by economists and urbanists.  Though Bertaud explicitly intends to bridge “the gap between urban economics and operational urban planning,” both researchers were trained as architects and define themselves as urban planners. The effects of Romer’s leadership on the Bank’s strategy and on the fields of development, urban economics, and urban planning will thus be interesting to see.

@HETSA: stay classic!

I am in Australia. I traveled here as invited speaker to the 29th annual conference of the History of Economic Society of Australia. HETSA (pronounced like you can wear it on your head) was founded in 1991. Today it has about 250 paying members, half of these based in Australia. The society publishes the journal History of Economics Review and has been indispensable in leading campaigns to protect the teaching of the history of economics in this country – for a revealing account of these efforts, pick up the recently published book Reclaiming Pluralism in Economics and have a look at part II.

The society’s conference is a two/three day event and this year was in Melbourne. The attendance was varied in disciplinary background, with economists in the majority but also philosophers and historians of politics and ideas. As in every conference, anywhere in the world, Japanese scholars were represented. Japan is certainly the most international of the history of economics communities, even if not always so acknowledged.

The highlight of the first day was a paper Rogerio Arthmar from Brazil with Michael McClure from Western Australia on the Soderstrom Gold Medal of 1961, awarded to Piero Sraffa. As Fourcade, Ollion and Algan recently reminded us, economics is an elitist discipline self-aware of its own packing order of departments and individuals. The role that prizes and other honors play in the regulation of that symbolic economy could be far better understood. Avner Offer and Phil Mirowski are writing on the Nobel prizes. Before the Nobels there was the Soderstrom Medal.

One of my most cherished prejudices was shattered on the second day. One of the not-so-quiet assumptions of this blog is that the most interesting work in the history of economics takes one to the 20th century, perhaps even post-1945. The opening session of the second day of HETSA was on “the classicals” and the speakers were not only young and bright but shamed my narrow mindedness. We heard of the make up of Nassau Senior’s social policy (by Satoshi Fujiumura), compared Smith and Mill’s principles of good taxation (Sean Kimpton), delved into the philological structure of Smith’s thought (Ryan Walter) and discovered how Malthus was claimed for the sake of scandal and legitimation by birth control advocates (Maxine Montaigne). The tour over the long 19th century was aided by the deeply knowledgeable and unfailingly humble Greg Moore.

The conference had the theme of “economic journalism,” which is why I was invited, and a panel discussion between two of Australia’s most distinguished economic journalists, Ross Gittins and Gerard Noonan, was fascinating, but besides, no other papers spoke to that topic. It reminded me that the history of economics and their publics, and of economic journalism, remains a hard sell. The energy, as shown by the two days, rests on more familiar territory traveled in renewed ways.

 

 

 

 

There ain’t no such thing as a free journal (or lunch)?

The History of Economics Review is the journal of the History of Economic Thought Society of Australia (HETSA). The journal started in 1981, first as a news bulletin of the society, and within half a decade also publishing original research. As of this Thursday the journal is published by Taylor Francis. The move brings a new editorial team and a desire to make the journal an obligatory read for the global history of economics committee, as the editors pledge in their brief opening statement. (My  humble suggestion to them is to encourage a review of the gender balance of their editorial board.)

To commemorate the occasion, the first T&F issue is open access, and can be accessed here, for ever and ever…free, gratis, no money … for real!

You will find original papers on A.W.H. Phillips by Selwyn Cornish and Alex Millmow, T. R. Malthus by John Pullen, and John Rae by David Reiss. You can read a polemic between James Forder and Thomas E. Hall and William R. Hart, and on the book review section you will find a critique of, Playground writer, Floris Heukelom’s book Behavioral Economics: A History, which nearly deserves its own polemic.

(For back issues contact HETSA, with a membership to the Society you get unlimited access to the trove, which is interesting for original research but also as documents to the history of our community.)

Notes on HES roundtable “Teaching the Next Generation”

At the annual meeting of the History of Economics Society, Sunday 19 June 2016, Fuqua Rand Classroom, Harro Maas organized a roundtable to discuss the “Teaching the Next Generation.” The panelists were: Annie Cot (Université Paris 1), Pedro G. Duarte (University of São Paulo), Edward Nik-Khah (Roanoke College), Sandra Peart (University of Richmond), and Ivan Moscati (University of Insubria). Below are notes taken by Harro. We encourage anyone who attended the event to extend, correct or comment on these notes.

  • Annie gave an account of French teaching, a bit of its history and different ways of doing history. She told us also about job opportunities in France that range from high schools to university positions.

 

  • Pedro pictured the state of history of economics in Brazil as growing but fragile. He emphasized the importance of institutional backing. A very concrete example of such backing was ESHET’s sustained, also financial, support for history of economics in Latin America. Its funds were crucial in bringing together Latin American scholars (now resulting in a new Latin American society). Young scholars in Latin America are less associated with heterodox economics as the older generation. Challenges he saw were: Quantitative history; Blogs; Macro-economists willing to talk; New kinds of materials for doing history of economics that should be taken serious.

 

  • Eddy noted that the contemporary economics profession has given up on history; no Schumpeters, Blaugs or Heilbroners any more. What kind of people might be interested in history of econ, or even are so: STS, economic sociologists, or an unexpected office-mate as in Yann Giraud’s case. He saw it as the task (or part of the task) of historians of economics to give some context to what is currently going on; to contribute to the larger world of contemporary ideas, and economics is part of that. i.e. historians of economics should reach out to a more general public and to other communities. He (with Phil) have tried to do so with their history of information and market design that started as a course taught with INET (note again that funds help such projects).

 

  • Ivan told about the new PhD program (methods and models for economic decisions) at his university that includes the possibility of a thesis in history and methodology of economics. His colleagues are open to Ivan’s work but have no further interest in it.

 

  • Sandy: gives a twist to the question: not what to teach them, but what to do to make the next generation flourish; how to support their scholarship. Young scholar program was intended for that purpose. Instrumental in its establishment: Neil Niman (treasurer), John Davis, Dan Hammond and Mary Morgan. Free banquet tickets for the young scholars so that they don’t feel inhibited to participate and have the opportunity to mix with the older scholars.
    • Help young scholars to present their work (HM – HISRECO was and is important for that).
    • Help to professionalize them (HM – a session/workshop on how to submit to journals, how to present a paper, how to approach institutions/economists for interviews or otherwise)
    • Celebrate what young people are doing.

Summer institute served different function. People presenting there: first jobs, no institutional context, lonely existence, possibility to present unfinished work in friendly and supportive atmosphere. Wisdom transferred to someone who is only starting by speaking on the same level. Funding was never a problem so that young scholars could be paid, without strings attached. Editors invited; discussions about what it is like to write a book.

A virtual summer camp for historians with deadlines

The blog History of Economics Playground began in November 2007.  We were brought together as the youth of the history of economics. In a field that honors the discrete and collected elder, we wanted to brave new ground. We wanted to be serious about being playful. For 4 years, we debated, gossiped and expressed our feelings about life in scholarship. In 2011, we left the playground and went blogging @INET.

billwattersonNine years after, we’re hopefully still good-looking and enthusiastic, yet also swamped with deadlines. Some of us are writing habilitation theses, others are finishing a book,  revising some articles, preparing talks and lectures or applying for grants. This summer, we will be reading the same books and papers, and our topics will often intersect. We will research various protagonists embedded in similar contexts, yet we will disagree a good deal about what shaped economics as we know it today. We are therefore reopening our old playground for a couple of months, turning it into a summer bootcamp for historians with deadlines.

Pooling together for 2016 summer camp are Ivan BoldyrevBeatrice CherrierYann Giraud and Tiago Mata. Others will meet us by the beach at some point. If you’re interested in joining, just send an email to any of us.

Time to get a tan.

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