I’ve never been much of a fan of Lionel Robbins 1932 Essay on the Nature and Significance of Economic Science. It smacks of what I’d call ‘authoritarian methodology’ which had its sterile apotheosis in Popper’s efforts to demark ‘science’ and ‘non-science’. To cut a long story short, even one of Poppers more rusted on fans, Troppo’s own Rafe, concedes that at least in this regard Popper is a little like the logical positivists, with whom he sympathised but disagreed on method, who IMO are the philosophical equivalent of the Titanic, sinking on their maiden voyage. (If one applies their own criterion of truth to itself, it diagnoses itself as nonsense – at least David Hume could rightly argue that he didn’t have someone else’s mistake to learn from).
In any event, though I’ve dipped into the book in quite large doses, I usually recoiled from it because it smacked of this, and because I can’t really see the point. In any event it was part of a great contraction in economics which hugely hollowed out what was considered as ‘real economics’. In short, if it doesn’t have formal theory it ain’t economics and if it’s empirical if it doesn’t have statistics or some other formal empirical method it ain’t really economics. The body of economics or at least micro thereafter slowly shrivelled up into various elaborations and footnotes of ‘the pure theory of choice’.
Robbins was particularly associated with the idea that ‘economics’ should be devoid of value judgements. Of course we all know what he’s getting at. If you like, science is an enterprise based on the metaphysical presupposition that the truth is ‘out there’ whatever our values are. But it turns out that there is lots wrong with the idea that economics really can be value free if one really wants to make the case in a philosophically rigorous way, and if it is seeking to describe how economic practice either is or should be, a little reflection suggests it to be a very unfortunate idea. Of course there is a kernel of truth to it, which Robbins was extrapolating from, which is that when one is in the realm of formal method, one’s values might guide your choice of problem, or your framing of the question, but the formality of your method defines the results you get, not your values.
In any event, So I was intrigued to read of this essay – by historian and philosopher of economics David Colander. Again I’m too busy to read it, but it is going into my Christmas pile. But I’ll leave you with the abstract. Anyone with the time might like to have a squiz – please let us know what you think in comments.
This paper argues that Robbins famous definition of economics was of economic science which he saw as only a narrow branch of the field of economics. The field of economics included both economic sciencewhich his definition dealt with, and political economy–which his essay did not deal with. His prescriptive message was that policy belonged in the political economy branch of economics. He believed that while the science of economics should avoid value judgments as much as possible, the political economy (applied policy) branch of economics should, and must, include value judgments. That prescriptive message has been lost.
Colander seems to be restating the valid point that Robbins was making about the distinction between propositions about the way things work (or the way they are) and proposals about policies to achieve desired outcomes. There is also some history about the decline of welfare economics into formalism and the way economics has changed out of recognition since the 1930s by taking on board things like game theory and experimental economics.
Since Popper was dragged in for a whipping I have to say that he was not like the positivists at all. He is sometimes mistaken for one of them because he spent so much time arguing against them and for that reason one might think that he was obsessed with the same issues.
Social scientists should have spent more time on The Poverty of Hisoricism where Popper actually addressed the methods of the social sciences, instead of taking up the unhelpful line on “falsificationism” that found its way into economics from Lakatos and his followers, especially Spiro Latsis and Mark Blaug.
The demarcation debate in retrospect was a waste of space. It probably derived from the obsession with Newtonian Science (capital S) and the efforts that were made to emulate the inductivist approach that was supposed to be the key to it.
So far as induction was concerned, Popper’s constructive contribution was to show how we can do without it, that is, to use a critical approach and test theories instead of accumulating data and hoping for the best.
On demarcation, his approach has two positive aspects. First of all it means finding out at the start of an argument whether the other party is prepared to take evidence seriously (that is, critically). So if you are confronting a true believer of some kind you can decide to bail out sooner rather than waste a lot of time to no effect.
Then when you have agreed that evidence is going to count in the discussion, it forces attention on the kind of evidence that will make a difference. In the case of policy debates this means getting clear on the problem that is being addressed, the proposed policies and the likely (or actual) outcomes of alternatives. In the field of theory it means (again) getting clear on the problem and the rival theories, how they might be articulated, developed and tested, including the very practical tests of using them as the basis of policies.