Weight Of Recovery

In 1871, W. Stanley Jevons in the preface to his book The Theory of Political Economy writes of a fundamental human issue with Economics. He makes a distinction between it and other sciences which do not suffer, as he said a century and a half ago, “the weight of authority.” Finding such words from so long ago from when Economics was a relatively new endeavor is as illuminating as it is frightening.

From then to now, how can we call this is a science when its tendencies from almost the beginning seek to quell further investigation?

I believe it is generally supposed that Adam Smith laid the foundations of this science; that Malthus, Anderson, and Senior added important doctrines; that Ricardo systematised the whole; and, finally, that Mr. J. S. Mill filled in the details and completely expounded this branch of knowledge. Mr. Mill appears to have had a similar notion; for he distinctly asserts that there was nothing in the Laws of Value which remained for himself or any future writer to clear up. Doubtless it is difficult to help feeling that opinions adopted and confirmed by such eminent men have much weight of probability in their favour. Yet, in the other sciences this weight of authority has not been allowed to restrict the free examination of new opinions and theories; and it has often been ultimately proved that authority was on the wrong side. [emphasis added]

In Economics, authority trumps all else. The issue for science is supposed to be one of evidence, primarily. Unlike other sciences, what in Economics passes for observation or might fit within Karl Popper’s definitions? We have at best incomplete statistics augmented by imperfect market prices, where the relation between the economy reported on by the statistics and those prices remains mostly a hidden mystery.

Under these circumstances, why not just revert to authority? If Keynes said the world was supposed to do X when given Y, and instead does Z, the default position for many if not the vast majority of Economists is to go back to Y rather than X. Keynes has to be right, it is assumed, not because of any recent evidence but because we are still talking about Keynes.

The point is not to get into doctrinaire argument about which brand of Economics is less useful than another, but to follow the general theme to its furthest conclusions. None of these Economists who have filled all the official jobs from one end of the Earth to the other have been able to solve the lost decade. Not one. And in so failing they have often been reduced to redefining the standard for success.

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Author: Travis Esquivel

Travis Esquivel is an engineer, passionate soccer player and full-time dad. He enjoys writing about innovation and technology from time to time.

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