The First International Symposium on the History of Economic Thought (ISHET) took place in the Department of Economics at the University of São Paulo from August 3rd to the 5th. The theme of this event was “The Integration of Micro and Macroeconomics from a Historical Perspective” and it brought together a group of renowned historians of economics from abroad as well as local members of this community. In the audience, besides the local discussants and the presenters, there were many students and professors from other Brazilian universities who all basically stayed throughout the symposium.
The symposium was opened by Robert Gordon (Northwestern University), a macroeconomist who has contributed to important discussions in this field since the 1970s–he obtained his BA from Harvard in 1962 and his Ph.D. from the MIT in 1967. The title of Gordon’s lecture was “American Debates on the Sources of Business Cycle” and in it he made an overview of developments in macroeconomics and the problems brought up by the current crisis–he criticized the current macro models for failing to incorporate many elements that are central to understanding the current crisis (echoing criticisms of other economists that the current synthesis in macroeconomics is simply useless).
The first historians to present, in the first day, were Kevin Hoover (Duke University) and Robert Leonard (Université du Québec à Montréal). Kevin discussed that there are different programs of microfoundations, instead of just the one associated with Robert Lucas and his critique of macroeconometric models used for policy analysis. He argues that the distinction between micro and macroeconomics—and the questions of how one relates to the other—dates from the 1930s and that besides the microfoundations of Lucas (within a representative-agent framework), there are two other programs: one Marshallian, rooted in Keynes’s General Theory, and a fixed-price general disequilibrium theory associated with economists like Patinkin, Clower, and Barro and Grossman. He paid special attention to the relationship of such programs to those of general equilibrium and econometrics that date both from the 1930s. Leonard discussed the questions of foundational critique in economics through Oskar Morgenstern’s life and transformations (questions about the role of mathematics in economics, how to model time, among others): from his Austrian breeding to his Princeton years and work with John von Neumann in the 1940s.
In the second day, the presenters were Wade Hands (University of Puget Sound) and Philip Mirowski (University of Notre Dame) in the morning, and Michel De Vroey (Université Catholique de Louvain) and myself in the afternoon. Wade made a very interesting parallel between the rise and fall of Keynesian macroeconomics and the kind of (Walrasian) general equilibrium in microeconomics that emerged during and after World War II. He used the idea of co-evolution to explore the mutual stabilization of Keynesian macro and Walrasian micro. Phil, in his usual enchanting way of a showman, showed the anti-Keynesianism that characterized the three main schools in economics, in the period 1943-1954: Chicago, the MIT and the Cowles Commission, with a focus on the latter two. By doing so, he pondered the recurrent need several economists have of calling themselves Keynesians (he talked about a “zombie Keynes” and compared the neoclassical economists to the Wile E. Coyote, trying to catch Road Runner always with a new technology, but ending up just with the “Beep beep” sound… Wait to watch the video online!).
In the afternoon, Michel discussed to what extent the new classical and real business cycle (RBC) “revolution” in macroeconomics was a matter of microfoundations: he first appraised the “strictness” of Lucas’s microfoundations, then characterized the new classical/RBC movement as a Kuhnian revolution in two stages, and even discussed the possible political agenda of their members. Finally, I closed the day with a discussion on how macroeconomists now perceive the new synthesis in their field (what are its main elements) and how such perception is linked to their understanding of how macroeconomics evolves over time (with a widespread notion of knowledge accumulation). I then discussed how a particular set of elements, mainly the assumption of a representative agent and a particular call for microfoundations (à la Lucas), delimited an area in which the new classicals, RBC theorists and new Keynesians could trade and construct the current consensus.
In the last day, in the morning, there was a round table with the participation of all presenters: each had 10 minutes to ponder the general theme of the symposium, before we opened the floor to questions. The discussion was lively and interesting. In the end, several participants saw that many questions and future points of research emerged during the event, which is indeed a very positive thing.