David Colander wrote: 

“As soon as economists are doing more than analyzing formal models or
doing empirical work for understanding purposes only, which meant any
time they were advocating relating the model to suggested policy in a
particular fashion, then they were acting as ‘statesmen’, not as
economic scientists. When acting in this statesman role, they should not
claim the imprimatur of economic science for their particular
interpretation. I think using the imprimatur of science is done on both
sides of the political spectrum, and it undermines people’s belief in
economic scientist’s objectivity…. 

“For a theory to be anything more than a conjecture, you have to have
empirical validation of the theory, and even today, we are struggling
with that.  In my view economists can’t draw many scientifically
validated inferences about policy from their current theory and models,
even though many do. In doing so they are in my view, operating outside
of science…. 

“In my interpretation economic science is a relatively small area
where researchers are interested in understanding for the sake of
understanding alone. In fact, a person devoted to economic science  may
well try to keep away from policy completely because it means he or she
has a horse in the race, which makes it much harder to be as objective
as possible, or to convince people that you are, even if you think you
are.”  

I suppose if your intention is to make economics as policy relevant as
the study of ancient Greek then what Colander wrote might be true. But
economics is a policy science. Its interest is and always has been in
knowing what to do to achieve certain results (cf A. Smith and D.
Ricardo). We are not astronomers looking at the stars with no ability to
affect anything in the heavens and therefore no policy intent
whatsoever. The stuff economists write and say turns up in the decisions
of governments which is why governments hire more economists than
scholars in classical Greek. 

Let me return to the Ravier paper you can find in that copy of
“Laissez-Faire” mentioned in an earlier post. This is what he
wrote, and this was just about HET and not economics in general where
his words are even more applicable: 

“In concluding, let us go back to the initial question: Should the
history of economic thought play an important role in the education of
an economist? It depends. If the student wants to be a technocrat,
publishing articles in the most prestigious academic journals and be in
the mainstream, possibly for him the history of economic thought would
be a waste of time. Instead, it would probably be more helpful to learn
matrix algebra, mathematical analysis and econometrics. But if the
student wants to become a serious thinker and research real problems
that still remain unresolved, then there is no other way than to spend
considerable time and effort on research in the evolution of ideas.” 

I think this is the same distinction made by Colander. If what you
prefer is an in depth investigation into the number of angels that can
dance on the head of a pin, go for it. Embed yourself in all that
irrelevant nonsense, give each other prestigious awards and promote each
other to the top of the academic tree. But if your interest is to
actually do some good in the world, to use economic theory to make the
world a better place, well that is not the way. 

The truly interesting economic debates are ultimately policy debates.
Who can deny that every economist comes with a particular genetic code,
a personal past and a slew of biases that have arisen from somewhere. If
this was decisive then you would give up on the whole of the social
sciences since you could never then approach objective truth. But I
think you can. That is why we go onto this site and other such places
and try to convince each other that what we believe is true. And to turn
this conclusion of mine into anything other than a considered judgement
worth considering on its own merits turns someone from being an
objective social scientist into some kind of postmodern charlatan who
would prefer to evade the issue at hand and change the subject to
something else instead. 



Dr Steven Kates
School of Economics, Finance
    and Marketing
RMIT University
Level 12 / 239 Bourke Street
Melbourne Vic 3000

Phone: (03) 9925 5878
Mobile: 042 7297 529