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Economists are in broad agreement because they're paid to be. This is well-documented historically. The Mont Pelerin Society was specifically founded to promot

Economists are in broad agreement because they're paid to be. This is well-documented historically. The Mont Pelerin Society was specifically founded to promote a certain view of economics, and the Chicago School was supported financially by some very rich sponsors who wanted a a pet academic alternative to progressive slant of Keynesianism. The "consensus" in neoliberal economics and its core ideas - including "rationality" and "efficiency" - is a wholly manufactured political project, not an organic open-minded attempt to find credible scientific foundations.

DavidSJ 6y ago
The existence of human irrationality is not unknown to economists. Behavioral economics, which concerns itself with the effects of this phenomenon on economic decision-making, is one of the major branches of the subject studied today.
- pessimizer 6y ago
  Yet it still gets grouped in as "heterodox."
  - huitzitziltzin 6y ago
    No. Behavioral economics is absolutely not considered heterodox. Mainstream departments (Chicago, mit) all have behavioral people. They don’t have heterodox people (eg marxists, Austrians, or MMT). Nor should they. CS departments won’t hire people who (for example) believe computers work via magic. Dollars and tenure lines are scarce and can’t be wasted on BS. There is a lot more diversity of thought in economics departments than commenters here know, but there are limits, as there are in every field.
    - gmtx725 6y ago
      my main problem with economics is it makes a philosophical error in that it assumes people and economic agents are inert objects to be studied as you would chemicals or atoms, without the capacity to react and respond to economic "laws" thereby changing them. Reflexivity is a thing.
      - huitzitziltzin 6y ago
        > it makes a philosophical error in that it assumes people and economic agents are inert objects to be studied as you would chemicals or atoms, without the capacity to react and respond to economic "laws" thereby changing them. This is literally the foundation of macroeconomics AFTER Keynes. This is (one of several) reasons why Keynesianism was rejected. Every single macroeconomist in every mainstream department in the country (and everyone in a central bank anywhere) would agree with exactly what you said AND say that it is precisely that fact which makes macroeconomics really hard. This is why, for example, even the bare-bones simplest macroeconomic model you learn in your first year graduate macro class must include some notion of the agents' expectations. It would be an error if we didn't do that. But fortunately, it's been at least 50 years since we started thinking about exactly that problem.
    - rrrrrrrrrrrryan 6y ago
      Oh, come now - comparing Marxists to people who "believe computers work via magic" is a little harsh. Econ departments don't have Marxists for the same reason philosophy departments don't have Buddhist scholars: it's just not where they belong. The Buddhists belong in religious studies, and the Marxists belong in the political science department.
huitzitziltzin 6y ago
> Economists are in broad agreement because they're paid to be. This is well-documented historically. This is *complete* nonsense. No one pays me to think or say anything. No one pays anyone in my department anything to take a particular position. For a simple example of what nonsense your claim is: the economist’s definition of rationality is that preferences are (1.) complete and (2.) transitive. That’s it. (See any microeconomics textbook for proof. Sometimes (3.) reflexivity is included, sometimes smaller sets of axioms which imply the others are used instead.) How “political” is that definition?? Did someone rich guy pay Paul Samuelson or Gerard Debreu or Kenneth Arrow to use that definition 80 years ago? Obviously not - moreover Arrow and Samuelson at least were on the political left! (And I simply don’t know Debreu’s politics. He could have been on the left too.) Your comment is *entirely uninformed* and *totally unfair* to an entire profession.
- bingbong70 6y ago
  Paul Krugman, I believe, talked about the risk of being blacklisted if one attacks the US monetary system and central bank. I expect there is some truth to his observations about pissing off the money printers.
- gmtx725 6y ago
  It's not that simplistic, it's not a conspiracy it's a self-selecting self-replicating system. How do economics professors get hired? By impressing other economics professors. And by having the power to win funding for the department. Who are the people that tend to fit those criteria? Mostly, those who already agree with the existing establishment, and those who already have views amenable to the well-resourced bodies that distribute funding.
  - huitzitziltzin 6y ago
    > How do economics professors get hired? By impressing other economics professors. This claim is true. > Who are the people that tend to fit those criteria? Mostly, those who already agree with the existing establishment This claim is false. If you can empirically support a result which shows that something most other economists believe is likely false and can do so convincingly, you can write your ticket to any department in the country. Some of the most successful graduate students every year do things like this (not all, because it's very hard to do). But the profession is 100% open to this kind of work. > And by having the power to win funding for the department. This demonstrates a misunderstanding of how economics departments are funded. Grant funding is a very small part of the departmental budget everywhere. We are not (to take an example where department funding does depend on grants) health policy departments.
specialist 6y ago
> Mont Pelerin Society Last week, I thought divining an Erdős Number for economics would be amusing. My casual effort hasn't identified a sole patient zero, prime mover, economic Eve (or Adam). The MPS roster has multiple candidates. Any suggestions? https://en.wikipedia.org/wiki/Erdős_number https://en.wikipedia.org/wiki/Erdős_number https://en.wikipedia.org/wiki/Mont_Pelerin_Society https://en.wikipedia.org/wiki/Mont_Pelerin_Society
titanomachy 6y ago
What are the best counterarguments for the "four basic truths" he claims are broadly accepted? Taking the first claim as an example (decline in demand leads to unemployment and recession, because sticky wages etc.), I suppose one could argue that just because we've seen this happen before doesn't mean it's an inevitability of human nature. I can imagine a society with a higher level of cooperation and shared responsibility, where everyone _does_ agree to take a small reduction in pay so that others can stay employed and the overall economy suffers less. If you agree with that argument, my best response to it is that these macroeconomic "theorems" are supposed to be phenomenological rather than prescriptive. They have predictive power in the present economic system but are not necessarily useful in a society radically different from ours. I agree that it would be an error to treat these emergent properties as some sort of inevitable laws of nature, which is a tendency that I've seen in debates.

DavidSJ 6y ago

The existence of human irrationality is not unknown to economists. Behavioral economics, which concerns itself with the effects of this phenomenon on economic decision-making, is one of the major branches of the subject studied today.

pessimizer 6y ago
Yet it still gets grouped in as "heterodox."
- huitzitziltzin 6y ago
  No. Behavioral economics is absolutely not considered heterodox. Mainstream departments (Chicago, mit) all have behavioral people. They don’t have heterodox people (eg marxists, Austrians, or MMT). Nor should they. CS departments won’t hire people who (for example) believe computers work via magic. Dollars and tenure lines are scarce and can’t be wasted on BS. There is a lot more diversity of thought in economics departments than commenters here know, but there are limits, as there are in every field.
  - gmtx725 6y ago
    my main problem with economics is it makes a philosophical error in that it assumes people and economic agents are inert objects to be studied as you would chemicals or atoms, without the capacity to react and respond to economic "laws" thereby changing them. Reflexivity is a thing.
    - huitzitziltzin 6y ago
      > it makes a philosophical error in that it assumes people and economic agents are inert objects to be studied as you would chemicals or atoms, without the capacity to react and respond to economic "laws" thereby changing them. This is literally the foundation of macroeconomics AFTER Keynes. This is (one of several) reasons why Keynesianism was rejected. Every single macroeconomist in every mainstream department in the country (and everyone in a central bank anywhere) would agree with exactly what you said AND say that it is precisely that fact which makes macroeconomics really hard. This is why, for example, even the bare-bones simplest macroeconomic model you learn in your first year graduate macro class must include some notion of the agents' expectations. It would be an error if we didn't do that. But fortunately, it's been at least 50 years since we started thinking about exactly that problem.
  - rrrrrrrrrrrryan 6y ago
    Oh, come now - comparing Marxists to people who "believe computers work via magic" is a little harsh. Econ departments don't have Marxists for the same reason philosophy departments don't have Buddhist scholars: it's just not where they belong. The Buddhists belong in religious studies, and the Marxists belong in the political science department.

huitzitziltzin 6y ago

> Economists are in broad agreement because they're paid to be. This is well-documented historically. This is *complete* nonsense. No one pays me to think or say anything. No one pays anyone in my department anything to take a particular position. For a simple example of what nonsense your claim is: the economist’s definition of rationality is that preferences are (1.) complete and (2.) transitive. That’s it. (See any microeconomics textbook for proof. Sometimes (3.) reflexivity is included, sometimes smaller sets of axioms which imply the others are used instead.) How “political” is that definition?? Did someone rich guy pay Paul Samuelson or Gerard Debreu or Kenneth Arrow to use that definition 80 years ago? Obviously not - moreover Arrow and Samuelson at least were on the political left! (And I simply don’t know Debreu’s politics. He could have been on the left too.) Your comment is *entirely uninformed* and *totally unfair* to an entire profession.

bingbong70 6y ago
Paul Krugman, I believe, talked about the risk of being blacklisted if one attacks the US monetary system and central bank. I expect there is some truth to his observations about pissing off the money printers.
gmtx725 6y ago
It's not that simplistic, it's not a conspiracy it's a self-selecting self-replicating system. How do economics professors get hired? By impressing other economics professors. And by having the power to win funding for the department. Who are the people that tend to fit those criteria? Mostly, those who already agree with the existing establishment, and those who already have views amenable to the well-resourced bodies that distribute funding.
- huitzitziltzin 6y ago
  > How do economics professors get hired? By impressing other economics professors. This claim is true. > Who are the people that tend to fit those criteria? Mostly, those who already agree with the existing establishment This claim is false. If you can empirically support a result which shows that something most other economists believe is likely false and can do so convincingly, you can write your ticket to any department in the country. Some of the most successful graduate students every year do things like this (not all, because it's very hard to do). But the profession is 100% open to this kind of work. > And by having the power to win funding for the department. This demonstrates a misunderstanding of how economics departments are funded. Grant funding is a very small part of the departmental budget everywhere. We are not (to take an example where department funding does depend on grants) health policy departments.

specialist 6y ago

> Mont Pelerin Society Last week, I thought divining an Erdős Number for economics would be amusing. My casual effort hasn't identified a sole patient zero, prime mover, economic Eve (or Adam). The MPS roster has multiple candidates. Any suggestions? https://en.wikipedia.org/wiki/Erdős_number https://en.wikipedia.org/wiki/Erdős_number https://en.wikipedia.org/wiki/Mont_Pelerin_Society https://en.wikipedia.org/wiki/Mont_Pelerin_Society

titanomachy 6y ago

What are the best counterarguments for the "four basic truths" he claims are broadly accepted? Taking the first claim as an example (decline in demand leads to unemployment and recession, because sticky wages etc.), I suppose one could argue that just because we've seen this happen before doesn't mean it's an inevitability of human nature. I can imagine a society with a higher level of cooperation and shared responsibility, where everyone _does_ agree to take a small reduction in pay so that others can stay employed and the overall economy suffers less. If you agree with that argument, my best response to it is that these macroeconomic "theorems" are supposed to be phenomenological rather than prescriptive. They have predictive power in the present economic system but are not necessarily useful in a society radically different from ours. I agree that it would be an error to treat these emergent properties as some sort of inevitable laws of nature, which is a tendency that I've seen in debates.