Map of life expectancy at birth from Global Education Project.

Tuesday, September 13, 2011

Hey indeedy

I have often claimed here (and elsewhere) that economics is not a science, but a kind of theology. Economists do not set out to discover truths by studying reality. Rather they make a bunch of assumptions -- none of which are, you know, true -- and then spin out a fantasy world from the assumptions. The purpose is to tell us how we ought to behave, in particular why we should tolerate the injustices of the present day as the proper state of nature. The Free Market™, in particular, is entirely fictitious -- an elaborate delusion that never has existed and never could exist.

This somewhat arcane essay by David Graeber on the origin of money is entertaining, and concludes with the eloquence of Thoreau:

At this point, it’s easier to understand why economists feel so defensive about challenges to the Myth of Barter, and why they keep telling the same old story even though most of them know it isn’t true. If what they are really describing is not how we ‘naturally’ behave but rather how we are taught to behave by the market—well who, nowadays, is doing most of the actual teaching? Primarily, economists. The question of barter cuts to the heart of not only what an economy is—most economists still insist that an economy is essentially a vast barter system, with money a mere tool (a position all the more peculiar now that the majority of economic transactions in the world have come to consist of playing around with money in one form or another) [10]—but also, the very status of economics: is it a science that describes of how humans actually behave, or prescriptive, a way of informing them how they should? (Remember, sciences generate hypothesis about the world that can be tested against the evidence and changed or abandoned if they don’t prove to predict what’s empirically there.)

Or is economics instead a technique of operating within a world that economists themselves have largely created? Or is it, as it appears for so many of the Austrians, a kind of faith, a revealed Truth embodied in the words of great prophets (such as Von Mises) who must, by definition be correct, and whose theories must be defended whatever empirical reality throws at them—even to the extent of generating imaginary unknown periods of history where something like what was originally described ‘must have’ taken place?



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roger said...

here at chez bums we describe econ as one of the "flacid sciences." how telling that graeber's first critic had to admit he didn't even read the essay.

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