Comment of the week: Radford on Lawson and Nuno

Peter Radford posted this comment on How to build a narrative linking the various heterodoxies: Part 3

Perhaps the most telling thing about Lawson is that he found it necessary to define ontology to economists. Therein lies the entire problem. It seems that generations of economists have simply plunged into the discipline without giving much though to what they are doing, how and why they are doing it, and what it is that they are studying.

Because of this careless approach it became easy to conflate markets with economies and ignore whole swathes of economic artifacts, problems and relationships. As a result the discipline’s mainstream shrank to become a relentless focus on one small corner of a vast arena, whilst, at the same time, claiming to be covering the entire field.

So Lawson is right to require an ontological basis for the beginnings of economics, and he has revealed themes that provide a necessary coherence to economics, none of which require the subject to leave the realm of reality. What I find frustrating is that, despite his efforts, heterodox economists often fail to situate themselves within the larger domain, but rather see themselves as being more self-contained, and as critics of orthodoxy instead of a component of that larger domain.

Perhaps Nuno hits at the cause of this apparent fractured nature of heterodoxy when he highlights the methodological consistency of the mainstream and contrasts it with the ontological consistency of heterodoxy.

It seems that mainstream economics has become a method. It provides an analytical toolkit with which to attack problems. Once that method is embraced students can apply it to a variety of what appear to be economic issues. Indeed the success of the mainstream in enforcing this methodological consistency has contributed to its domination: it is the ‘swiss army knife’ of the social sciences. All one has to do is to define a problem the right way and the apply the method. Conversely, worrying about whether the method is appropriate is not a consideration once economics has been redefined and its borders limited to only those issues that the method can be applied to.

But before we get lost in a wholly negative critique of the mainstream we should all remind ourselves that it has been extraordinarily successful in that small corner it occupies. The fact that it represents a very tiny piece of economics should not diminish that success. Indeed I can quite see a future, more inclusive economics, still retaining some of the mainstream method. Only this time with its application entirely limited and not allowed to be seen as the general tool it currently has become.

And this leads me to one last point: I think we should be very careful to follow Lawson into what appears to be a total rejection of the rigor of mathematics. We all agree that the social realm is vastly more complex than the physical realm. It is a terrain fraught with danger for anyone looking to simplify and deploy modeling techniques that are not sensitive to that complexity. But, with sufficient care, and with a keen eye on their limitations there are tools we can use to explore and explain an economy.

That presumes we know what an economy is … which brings us back to Lawson.