Archive for October 10th, 2010

We have often expressed dissatisfaction with the lack of pluralism in economics, a discipline which is now dominated by neoclassical theory. But what should also be clear is that this is more than a trivial academic debate about economic theory. The dominance of neoclassical theory is more of a “cultural hegemony,” to use the term described by Antonio Gramsci, in that neoclassical theory exerts control through a widespread consensus. And this consensus is what reaches far beyond the corridors of university economics departments.

First, and most obviously, neoclassical theory and methodology are changing other social sciences. Economics Ph.D’s are becoming chairs of other departments, such as political science departments, and economists are claiming to do the other social sciences better than other social scientists. The “freakonomics” style of economic research claims a method of scientific inquiry that can answer any question, given an appropriate data set. And this puts pressure on anyone who is not using rational choice theory to start doing so, so that the research can be considered “more rigorous.” All the top programs in Public Policy, Environmental Policy, and Development, for example, have significant requirements in neoclassical theory.

In addition, the field of “law and economics,” à la University of Chicago, is becoming part of the standard curriculum of law programs throughout the country. Law and Economics is essentially an approach to legal theory that applies the methods of neoclassical theory to law; indoctrinating law students with such an approach, without any mention or presentation of alternative economic methodologies, shapes the law and how our legal scholars think about society in a very particular way.

The hegemony of neoclassical theory extends far beyond economics, and has significant consequences for our world. I believe that understanding how we got to where we are today in economic theory will prove important to guiding the way forward, so I wanted to close with a quotation from an article by Esther Mirjam Sent explaining how she became interested in the history of economics:

As I mentioned, the reason I started studying economics is because I had this idea to improve the world, and then I realized that economics was not going to help me much in improving the world, so maybe instead of improving the world, what I should do is improve economics. And that is how I became interested in the history and also philosophy of economics.

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