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Date: | Fri Mar 31 17:18:43 2006 |
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----------------- HES POSTING -----------------
Regarding Bill Williams' comment about using the concept of utility in the
classroom and his direct reply to me, I think that the problem lies with
the textbook, not the concept. It is possible to write an economics text
that contains the same important material without using the term "utility"
and "marginal utility." We can say that when individuals choose among units
of this and units of that, their choices reveal their preferences for the
last unit of the X that they choose over the additional units of Y that
they could have chosen with the same money.
The choice among marginal units is a real phenomenon (although don't ask me
to prove it) and students should learn this; although many, if not most,
important buying choices by consumers are not among marginal units. I have
a preliminary intro text chapter on this if you are interested.
I'm afraid that the modern texts are designed partly to make it easier for
teachers to give lectures and to give tests and to correct them. They are
also partly designed to help prepare the students for the mathematical
version of economics.
Regarding David Colander's point about needing to make interpersonal
comparisons in order to do policy, Ludwig von Mises had a good answer. It
was that economists should not do policy. Rather, they should evaluate
arguments that a specific policy would achieve a specified goal or set of
goals. One way that he expressed this was to say that economics has the
task of identifying the dominant deologies and determining whether the
policies that the practitioners of these ideologies advocate are likely to
achieve the goals that they believe can be achieved by the policies. For
example, can socialist policies relating to the organization of production
by means of central planning achieve the goals of the central planners?
The question to ask is whether the image, or model, of behavior and choice
used to defend a policy argument is (1) logical and (2) relevant, given the
goals of that argument and the environment of the policy. That way,
economics can remain "value" free. As I recall, Coase attacked the
Pigouvian models on the grounds that they were irrelevant. This was very
much in the Misesian vein.
Pat Gunning
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