There is a
dispute among economists that seems at first a mere superficial matter of prose
style and presentation, but that may have a greater significance.
The dispute
is this: should economists use the paraphernalia of the quantitative sciences?
Should they use formulae with lots of Greek letters, and graphs
with clearly defined curves?
One body of
thought – found amongst self-identified Austrian school economists especially
though not uniquely – suggests that such paraphernalia are inherently
misleading. P.T. Bauer has phrased it well. Econometrics, he said, has
“contributed to the disregard or neglect of evident reality” because the use of
highly quantitative methods leads to unwarranted concentration on the variables
that fit most readily into a formal analysis, and leads to “the neglect of
influences which, even when highly pertinent, are not amenable to such
treatment.”
Bauer, the distinguished-looking fellow above, wrote this in 1987. He said formulae used for their own sake invert the old story of the Emperor’s New
Clothes.
“Here there
are new clothes, and at times they are haute couture. But all too often there
is no emperor within.”
On the other
side, there are such scholars as Leland Yeagar, who (though he describes himself
as a “fellow traveler” with the Austrians) criticized that tradition on this point. Some Austrians, he says, “have wanted to ban
mathematics from economics. But is it not arrogant for someone who does not see
how to use certain techniques constructively to suppose that no one else will
ever see how either? These Austrians should remember how, in other contexts,
they emphasize the openness of the future and scope for novelty.”
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