On what we do not see

In recent years, the call for pluralism has been at the heart of the scientific debate in Economics. Whether you, as an economist, find yourself against or in favour of the development of a plural economics, it is with no doubt a matter of interest for the entire community. Advocates for pluralism are found not only among “heterodox” scholars and students in organisations and institutions that demand an increasingly plural teaching and research, but also among prominent researchers who show concerns for what “we do not see”:

“What I am worried about most of all, is what we don’t see. So, I am worried about the analysis that is never seen, that never becomes a paper and it doesn’t become a paper, because it can’t become a paper. And it can’t become a paper, because that’s not what a paper in economics is all about. I am quite worried about that and [..] we don’t know such vacuums exist.”

While such words might echo a sentiment shared by scholars who define themselves as heterodox economists, they were in fact pronounced by George Akerlof at the ASSA-convention held in Chicago in 2017. During this convention, several scholars including James Heckman and Lars Hansen conducted a panel discussion on what they called ‘The Curse of the Top Five’, and the strengthening oligopoly in transmission of scientific economic knowledge. While all the panel participants underlined a vicious circle in which young scholars in the U.S. get tenure by the number of publications obtained in top journals, such measure in fact becomes the target. That is subject to the well-known Goodhart’s law: when a measure becomes a target, it is no longer a good measure.vicious

Among all the participants, Heckman reports concerns for possible “incest affiliation” between schools and journals. Hansen, meanwhile, suggests the excess of specialisation to be a deterrent for a correct assessment of submitted work, in which editors delegate to referees who might conduct too narrow of a judgement. Deaton points out the intrinsic heterogeneity in young scholars educated worldwide facing different political environments as a rationale for different approaches to economics. In addition to his concern cited above, Akerlof states that making such measure the target risks killing creativity, leading individuals to a personal assessment of own research work on the basis of what could be published or not, finally choosing in favour of what can be published, for clear reasons. This has the potential to leave a blackhole in research and risk letting a eureka moment slip out of our hands.

A growing number of individuals, also involving students, urges the development of a more plural economics education: from the UK where Rethinking Economics was born in 2012, this claim now includes several members all over Europe and the rest of the world, as well as other institutions such as Network for Plural Economics or the Institute for New Economic Thinking, whose advisory board is composed of influential economists such as Joseph Stiglitz and Amartya Sen, in addition to the previously mentioned Akerlof and Heckman. The Institute is in fact gaining particular relevance in their contribution to research and advocating the need for a reform of economics education.  The Institute supports reform of economics programmes under a growing pluralist perspective, especially at the undergraduate level, with the aim to educate young economists towards a progressive economics critical thinking.

Given pluralism is the issue on the table, let us go back to its definition: according to Oxford Dictionary, it is defined as “A condition or system in which two or more states, groups, principles, sources of authority, etc., coexist.” For the readers somewhat up to date on the subject, you will know that pluralism has been advocated on three core aspects of economics, involving theoretical, methodological and interdisciplinary pluralism. I will start analysing the third. All economists and non-economists will agree that economics has in fact made huge progress towards interdisciplinarity. On one side, research today involves behavioural economics, neuroeconomics, economics and ecology, and other sub-fields which include other disciplines’ features, contents and sometimes methodologies. Despite that, sociologists and economists Fourcade, Ollion and Algan (2015) argue that economics is still characterised by a high degree of insularity – it is the first in within-field citation, with 81 percent, compared to other fields like sociology, political science, and anthropology, with respective within-field citation of 52, 53 and 59 percent while far behind in regard to cross-disciplinary citations compared to sociologists and political scientists. For American Political Science Review, 4.1 percent of total citations goes to the top 25 economics journals, compared to a mere 0.8 percent in the American Economic Review from top 25 political science journals. While it is true that there are epistemological factors that make a field intrinsically insular, facts show that there remains a lot to be done to advocate economics as a truly interdisciplinary field.

The second feature of economic pluralism has to do with methodology, and relates the strong technical apparatus developed on the theoretical side and the empirical side. In economics, the choice of the model to be used has always been of great importance. Given the existing phenomenon we want to represent and what implications we are willing to test empirically, it seems reasonable that we look for the theoretical structure that best represents it. To do this, we look into our economists’ toolbox, which is wide and large in terms of variations of the same fundamentals. When thinking about the right tool to model reality, I reflect on my recent experience with professor Kevin Hoover on Reductionism and Anti-Reductionism in Macroeconomics, that is on the (need or not of) microfounded macroeconomics. Employing the philosophical concept of supervenience, where macro (upper-level) configurations of the world are determined by micro (lower-level) configurations, he suggests that macroeconomy supervenes on microeconomy, in the sense that any identical reconfiguration of agents in the economy results in the same configuration of macroeconomic entities, with the exception that this is not a one-to-one mapping. This fact does not ensure that macroeconomics is fully reducible to microeconomics, because if the goal of reducing macroeconomics to microeconomics is to capture human intentions, such intentions might themselves depend on real aggregates. On a similar perspective, Professor Simon Wren-Lewis from Oxford University suggests that if it is the case that “more equally valid microfoundations were observationally equivalent in aggregate terms, and equally reasonable as representing the reality”, then the aggregate model related to such representations have some utility beyond them.

Then the question is: is it an empirical question that brings us to choose what the best technique is to model reality? Or is it an a priori assumption? Such arguments might be relevant for an evaluation of those works which do not fulfil the criteria of leading journals in scientific economic knowledge. Furthermore, it brings us to the starting point we have made on the basis of Akerlof’s statement, that is how even useful contributions risk to never become actual research because of the lack of appeal to be published. And unfortunately, we cannot quantify the chances we pass up.

In conclusion, many other arguments remain to be addressed on the issues we have gone through here, which clash with the existence of constraints – economic, intellectual and pedagogical – so that the claim for a plural economics still requires a fine evaluation. A process towards plural economics involves addressing the concerns about editorial pluralism as well as a plural education working together; it will require careful consulting and punctual refinement, but it will eventually lead to a better understanding of the characteristics, economic and not, of the world around us.

by Flaminia Borelli

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