A Reflection on Economic Monism

Swiftly approaching the end of my economics degree, I find myself -much like many of my more critical colleagues- questioning what it is that this great university institution has made of us. For we are now technically ‘economists’, even If we are a little wet behind the ears. It is said that we have entered an elite group of individuals, capable of wielding a unique economic insight; understanding the fundamental human condition through the lens of economics. It is exactly that last sentence where the issue lies. In this short reflection I shall make the case that rather than being agents capable of doing economic analysis, interpreting the basic economic question and applying critical economic thinking to problems we may be faced with, the modern-day economics course is one which gives its students hammers, to whom all economic issues swiftly become nails. In doing so I shall employ Kuhns paradigm shift.

 

The origins of the methodological monism that has come to define economics has its origins in the general glut controversy of the post Napoleonic depression: out of which two competing thinkers emerged, Malthus and Ricardo. Here we are not concerned with the actual economic arguments that were made concerning Say’s law or full employment, instead, it is the ontological implications of the two methodologies. It was the seeming victory of Ricardo’s axiomatic deductive approach which went on to fundamentally influence the way in which economics is done today. The question is then, how is it that such an axiomatic approach employed by Ricardo has morphed in to the economics of today. The very economics that failed to see the blatant oncoming of the greatest financial crisis in human history.

 

Kuhn defines a paradigm as the following: ‘Paradigms I take to be universally recognised scientific achievements that for a time provide model problems and solutions to a community of practitioners’ (Kuhn, 1970, p. viii). In our case the paradigm is neoclassical economics and its practitioners are individuals like me. However, as practitioners we live within our paradigm. Neoclassical economics does not ‘for a time provide model problems and solutions’, instead, it is the only way in which we are able to problematise the world. It is not that we’re all ideologues who laugh out of the room anyone who dares to question the prevailing system (although that is exactly what we do), It is that economics today is understood and taught as a science. Here, science is the unquestionable, infallible method employed to understand the world, and for whom no competitors exist, as it is the only a priori reasonable way of doing things. In seeing itself as a science, orthodox economics doesn’t only quash all dissent, it also believes in ‘development by accumulation’ (Kuhn, 1970, p. 2). Economics therefore has a preconception that economic understanding today is clearly superior to that of the past. It does not only presuppose Andrew Gillespie’s ‘Foundations of Economics’ (2016) is superior to the thinking of Keynes, Marx or Mill. Such a world view also sees their understandings as debunked and flawed, and therefore unnecessary to study or understand.

 

Such an economics paradigm has no capacity to solve problems outside of its agenda and ability. Hence, it does not do so. The paradigm is such that in only solves problems it can, it perpetuates the paradigm further. When an economist comes across an issue of an economic nature, he turns to his toolbox. In his toolbox he finds a set of hammers, some small, some large, some more refined. Hammers of all sorts to solve all sorts of issues regarding nails. However, he is faced with a screw and incapable of thinking outside of his paradigm, the economist either applies what he knows to this problem, that being the hammer, or he swiftly moves on to find a nail which he can pound- for pounding nails is his raison d'être. We see such events occurring every day in economics. When faced with issues that neoclassical economics cannot solve, we either deny such issues exist at all and go find issues we can solve, or we try to apply such orthodox modelling to the problems of the future, from which no real solutions are born. Simply looking at issues of climate change, automation, underemployment and a knowledge economy based on intellectual property, we find problems which are either unaddressed by orthodox economics (for it does not have the tools to), or the application of solutions and methods which fall short in their ability to tackle them. Hence modelling a world around demand and supply, presupposing a phantom equilibrium, a complete mathematization of a social science, and interpreting humans as rational commodity maximisers can only go so far.

 

It is not within the breadth of this reflection to solve the problems of modern economic thinking but to show its fallibility. It is time for a ‘paradigm shift’ (Kuhn, 1970, p. 66) within economics and such a shift seems inevitable, for we are faced with macroeconomic problems to which we have no solutions. However, simply in the UK we have a system churning out thousands of economics graduates annually, all put through a system of education no different to that described. It is therefore clear that we need a fundamental change in the way we understand and teach economics. Such a paradigm should not be methodology centric, instead centred around solving macroeconomic issues. The issues for which economics exists to solve. Solutions for preventing crashes, spearheading advancements and bettering the lives of man. Rather than being subordinated by the market, economics should work to master the natural world for man’s ends.  

This article was written by Omer Selcuk

Works Cited

 

Kuhn, T. S. (1970). The Structure of Scientific Revolutions. The University of Chicago Press.