Saturday, June 27, 2009

The Economics of Economics

Or as Bryan Caplan might say, the Sociology of Sociology:
I've studied economics for over twenty years. The more I think about it, though, the more I realize that I don't know what "economics" means anymore.

Textbooks may say that economics is about "incentives" or "trade-offs." But you can publish papers in econ journals about the effect of birth weight on educational attainment. I don't see any incentives or trade-offs there. Or take Emily Oster's early research arguing that hepatitis, not infanticide or selective abortion, explained a lot of Asia's gender imbalance. Some economists asked, "How is this economics?" But if some economists argue that the gender imbalance is driven by incentives, how can you object if other economists say that the real explanation is medical? Or consider happiness research. Economists like Justin Wolfers are in the vanguard; but the connection to incentives or trade-offs is unclear.

You could deplore all this as a loss of focus. But I see massive progress. Economics has grown hard to define because we now focus primarily on real-world problems, not "literatures." If we want to understand income determination, we don't waste time with topological proofs. We still think about supply and demand, but we also think about policy, psychology, behavioral genetics, and much more. As a result, we come to understand the world, instead of solving unusually difficult homework problems.

What, though, is the common essence behind everything that economists now do? The only answer that works, I think, is that economics is the all-encompassing study of the social world. In the words of the Roman poet Terence, "Homo sum, humani a me nihil alienum puto" - "I am a man, I consider nothing that is human alien to me."

Unfortunately, this puts me in an awkward position. There's another field that already sounds like "the all-encompassing study of the social world": sociology. Not only does sociology have lower status than economics; with honorable exceptions, it's also well-stocked with academics who aren't fond of economics. Tactically, then, it would be foolish to start calling ourselves "sociologists." If we were picking names from scratch, though, "sociologists" is exactly what modern economists ought to proudly call ourselves.
Economics is explaining the world. Now that I've gotten my copy of the Economic Naturalist, we might see and increase in the "Economics of" posts.

No comments:

Post a Comment

You are the reason why I do not write privately. I would love to hear your thoughts, whether you agree or not.