by From Lars Syll Again and again, Oxford professor Simon Wren-Lewis rides out to defend orthodox macroeconomic theory against attacks from heterodox critics. In one of his latest attacks on heterodox economics and students demanding pluralist economics education he writes: The danger in encouraging plurality is that you make it much easier for politicians to select the advice they like, because there is almost certain to be a school of thought that gives the ‘right’ answers from the politicians point of view. The point is obvious once you make the comparison to medicine. Don’t like the idea of vaccination? Pick an expert from the anti-vaccination medical school. The lesson of the last seven years, in the UK in particular, is that we want mainstream economists to have more influence on
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Lars Pålsson Syll writes Cutting-edge macroeconomics …
from Lars Syll
Again and again, Oxford professor Simon Wren-Lewis rides out to defend orthodox macroeconomic theory against attacks from heterodox critics. In one of his latest attacks on heterodox economics and students demanding pluralist economics education he writes:
The danger in encouraging plurality is that you make it much easier for politicians to select the advice they like, because there is almost certain to be a school of thought that gives the ‘right’ answers from the politicians point of view. The point is obvious once you make the comparison to medicine. Don’t like the idea of vaccination? Pick an expert from the anti-vaccination medical school. The lesson of the last seven years, in the UK in particular, is that we want mainstream economists to have more influence on politicians and the public, and not to dilute this influence through a plurality of schools of thought.
And a couple of years ago he wrote the following:
Attacks [against mainstream economics] are far from progressive.
Devoting a lot of time to exposing students to contrasting economic frameworks (feminist, Austrian, post-Keynesian) to give them a range of ways to think about the economy, as suggested here, means cutting time spent on learning the essential tools that any economist needs … Economics is a vocational subject, not a liberal arts subject …
This is the mistake that progressives make. They think that by challenging mainstream economics they will somehow make the economic arguments for regressive policies go away. They will not go away. Instead all you have done is thrown away the chance of challenging those arguments on their own ground, using the strength of an objective empirical science …
Replacing [mainstream economics] with schools of thought is not the progressive endeavor that some believe. It would just give you more idiotic policies …
Mainstream economics is depicted by Wren-Lewis as nothing but “essential tools that any economist needs.” Not a theory among other competing theories. Not a “separate school of thoughts,” but an “objective empirical science” capable of producing “knowledge.”
I’ll be dipped!
Validly deducing things from patently unreal assumptions — that we all know are purely fictional — makes most of the modelling exercises pursued by mainstream macroeconomists rather pointless. It’s simply not the stuff that real understanding and explanation in science is made of. Had mainstream economists like Wren-Lewis not been so in love with their models, they would have perceived this too. Telling us that the plethora of models that make up modern macroeconomics are not right or wrong, but just more or less applicable to different situations, is nothing short of hand waving.
Wren-Lewis seems to have no problem with the lack of fundamental diversity — not just path-dependent elaborations of the mainstream canon — and vanishingly little real-world relevance that characterize modern mainstream macroeconomics. And he obviously shares the view that there is nothing basically wrong with ‘standard theory.’ As long as policymakers and economists stick to ‘standard economic analysis’ everything is just fine. Economics is just a common language and method that makes us think straight, reach correct answers, and produce ‘knowledge.’
Contrary to what Wren-Lewis seems to argue, I would say the recent economic and financial crises and the fact that mainstream economics has had next to nothing to contribute in understanding them, shows that mainstream economics is in dire need of replacement.
No matter how precise and rigorous the analysis is, and no matter how hard one tries to cast the argument in modern ‘the model is the message’ form, mainstream economists like Wren-Lewis do not push economic science forwards one millimetre since they simply do not stand the acid test of relevance to the target. No matter how clear, precise, rigorous or certain the inferences delivered inside their models are, that is no guarantee whatsoever they have anything interesting or relevant to say about real-world economies.