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The mathematization of economics has been well explained by Gerard Debreu in his 1990
presidential address to the AEA (see Debreu, G. (1991), [1]American Economic Review Vol.
81 No. 1, p.1-7.). Seemingly, Americans favored mathematization rather ardently. One
wonders if the mass production of economics graduates was much helped by the introduction
of the engine of mediocrity otherwise known as the semester system, coupled with
objective-typetest questions, and hurried presentations using mathematical tricks
regardless of their appropriateness. I wonder if the American educational factories try to
turn out quick graduates with superficial learning. (I studied at NYU.)
I wonder if the American passion for mass production and disregard of
quality, whether in the production of economics graduates or cars, has
really cultivated mediocrity (and democracy). Consider the Englishmen
DavidRicardo, William Jevons, Alfred Marshall, John Maynard Keynes, and
John Hicks. All of them used mathematics, but only to the extent necessary
to make the presentation crisp and clear, and not as a mindless engine of
mass producing theorems (but for scholarly elitism!). Alfred Marshall
actually did advise people not to employ mathematics as an engine of
inquiry, but to use it as a rhetorical device of presentation.
Then consider the contributions of Americans Paul Samuelson, Kenneth Arrow,
Gerard Debreu, Gary Becker, and Robert Lucas. Mathematics has become the
end for them. These second group is extremely shallow compared to the first
group. I am sure I can learn a lot more about money from Jevons,though his
book was written in 1875, than from Lucas, whose theorem on money appeared
in 1972. Has anybody noticed how mediocre is the idea that an increase in
employment can occur only with a rise in real wage rate? A shift of the
supply curve means that at the same real wage rate, a larger labor force is
employed, and this shift is possible with an increased supply of means of
payment to sustain the higher wage bill. Rational people cannot expect that
a rise in the supply of money will raise the nominal prices alone, because
they know that more money allows hitherto unused resources to be put to
work. There is no reality to which Lucasian
math applies. Empty math is not deep.
Has anybody noticed that Gary Becker (see Becker, G. S; and Lewis, H. G.
1973, On the interaction between the quantity and quality of children,
Journal of Political Economy, Vol 81, Part 2, pp S279-S288) made a mistake
(of not using the product rule of derivative properly), and could not set
up the budget properly, ending with strange theorems (such as the price of
quality is higher because it has to apply to a larger quantity of children,
while the whole issue is to prove that the rise in quality comes with a
fall in the quantity). Likewise, in a later paper with Barro (see Barro,
R.J. & Becker,G. S., 1988. "[2]Fertility Choice in a Model of Economic
Growth," [3]University of Chicago - Economics Research Center 88-8), Becker
sets up a model of dynastic fertility behavior, in which a man can borrow
from his unborn progeny to finance his own education. His argument would
mean that since Egypt invented literacy long before England, the Egyptians
would become richer and more educated in a virtuous cycle while the
originally illiterate Englishmen would forever remain poor and illiterate
in a vicious cycle. Math allows one to propose anything, but economics
should have facts for them. Why formulate a model of altruism (investing in
the children’s education at the same time as preventing the birth of other
children), if the goal is to borrow from the unborn?
I see evidence of mindless math everywhere in American economics. Excessive
mathematization has gravely harmed economics.
Mohammad Gani
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