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Non-mainstream schools of thought
A loyal MR reader requests coverage:
On mainstream versus "fringier" economic schools of thought (and schools themselves too if you like); and on different schools of thought generally, and your take on them; where economic theory is at present.
Here is me on Sraffa and the neo-Ricardians and also post-Keynesians and the Cambridge capital debates. The Austrians I cover all the time. Here is my post on what is new and essential in economics. Overall I don't believe in schools of thought for modern economics. Think of the notion of a school of thought as a brand. The whole point of the internet is to break down branding into the evaluation smaller units, including individuals and their very particular ideas, even doing cite counts paper by paper. Why move toward more macro branding in that kind of environment? You can think of trustworthy bloggers as another means of branding and also as substitutes for schools of thought.
Today I see neuroeconomics and personality psychology as two frontiers, plus economic history, but I wouldn't call any of those schools of thought, nor should they be.
Posted by Tyler Cowen on April 23, 2008 at 11:56 AM in Economics | Permalink
Comments
Increasingly many successful academics blog, but its not obvious that blogosphere ties yet muster the kinds of solidarity to provide career advantage. What barriers do you think are getting in the way of that.
Posted by: michael vassar at Apr 23, 2008 12:23:49 PM
"Overall I don't believe in schools of thought for modern economics. "
Despite disbelief, I think that economists do cluster, and when working on subject areas tend to delve so deeply into them that those who want to contribute to the area feel themselves to be an outsider to what amounts to a school of thought.
For example, lets say you've just finished your doctorate at GMU. Now you want to contribute something to an area such as "sticky wages after Keynes," you won't just be able to just read Keynes and read a dozen or a few dozen papers and books interpreting and responding to Keynes' ideas: you will have to confront an inbred gaggle of post- and neo-Keynesians who think you're way out of line for trying to step in on their territory; and you'll have a hard time getting published. Isn't this true?
Same applies for areas like business cycle theory, Solow growth model, developmental economics (responding to Sachs or something), etc. Partly it might be a micro/macro divide; partly that big names and egos are involved; partly just that people expect that nobody who hasn't spent their life concentrated in one of these areas can contribute because so many smart people have devoted their lives and so anyone who hasn't obviously can't offer much. But, whatever the reason, it still tends to split economics into schools.
Of course, that is just my amateur take.
Posted by: liberty at Apr 23, 2008 1:14:39 PM
Schools of thought do matter if they define the basic assumptions you are working with. The institutional crowd ("original" and new; I subscribe to both) has a different view on many matters because they take one step backwards to consider how and if most of the assumptions in neoclassical economics (e.g., transaction costs, enforcible contracts, political boundaries) even exist. From this perspective (there's a lot more), members of this school may see (some) other schools as completely invalid --- or perhaps just as mathterbators :)
Posted by: David Zetland at Apr 23, 2008 1:27:56 PM
Personality psychology:
Wow, I've been interested in this for the past 15 years. Probably because I have a rare type. And, I noticed that both Jung and Keirsey both have my personality type. So, it appears that interest in personality types may be predisposed by personality type.
Posted by: Andrew at Apr 23, 2008 4:15:36 PM
I agree with David Zetland up to a point - schools of thought also matter, and perhaps even more, if they are defined by the analytical tools they use. Austrians, in theory, deny the validity of most of the analytical tools of the other "schools" for the purpose of converting data into predictive theory.
Posted by: Anthony at Apr 23, 2008 4:17:15 PM
Hmmm. As someone who commented in the links that Tyler provided on some of these other schools,
I would add a curiosum that was only hinted at by me in one of them, one I suspect that Tyler is
well aware of: the odd overlapping of some ideas in the Austrian School and the Post Keynesian
School. In particular, both officially abjure equilibrium approaches and both are not at all keen
on rational expectations, emphasizing the substantial importance of unpredictable events in the economy.
Of course their adherents often view each other as enemies because of their differing ideological/
policy approaches, with Austrians tending to be much more pro-laissez faire while PKs are associated
with supporting much more government intervention to stabilize the economy. But the more acute
observers in both camps are well aware of the interesting overlaps in views and ideas.
Looking back at Tyler's post on the PKs, I would say that he overstates the degree to which the
more useful insights of the PKs have been integrated into the mainstream. Many have to some degree
or other, often without acknowledgement of where they came from. But some have not. I would note
that the dominant macro model is the Dynamic Stochastic General Equilibrium model, whose advocates
often argue that it is "the scientific macro model," and it certainly does not incorporate many
of the more useful insights from either the PK or Austrian macro critics.
It may be that having "schools" serves some useful function for organizing and focusing people
to think in certain ways. But getting too worked up about them easily degenerates into a sort
of theological approach that can be really annoying and distracting (and lots of Austrians do what
the PKs do as well, another similarity, although focusing on Mises and Hayek or Rothbard, rather
than on Keynes or Kalecki or Sraffa). In this regard it is worth keeping in mind the admonition/
argument of Robert Skidelsky that the original social background of many economists, at least in
the British Isles, was from the clergy.
Posted by: Barkley Rosser at Apr 23, 2008 4:17:57 PM
How is post-keynesian, and austrian non mainstream? We learn them in school too (well, at least we covered them)
Posted by: Chewxy at Apr 23, 2008 5:18:23 PM
Chewxy,
Neither of the assumptions that I noticed that they share are mainstream views,
that is a lack of enthusiasm for equilibrium analysis and a rejection of rational
expectations along with an emphasis on the importance of unquantifiable uncertainty
(which may have been buried in Tyler's comment about "noise traders," althought that
usually involves a somewhat more specific formulation).
Posted by: Barkley Rosser at Apr 23, 2008 6:11:43 PM
For those interested, I have written (I hope) readable yet informative articles on both the reswitching question (i.e. Cambridge capital controversy) and Sraffa's famous book. I agree totally with Tyler about Sraffa, though I'm protective of Bohm-Bawerk and so still like "roundaboutness."
Posted by: Bob Murphy at Apr 23, 2008 9:12:02 PM
My comment came out pretty messy before, but my point is this: isn't there still a division which results in a situation where economists kind of defend their turf?
It isn't only by subject matter, but also by school of thought. It determines where people can publish and what people assume about each other. Its based on the approach that the economist takes, the kinds of assumptions he makes, and what he studies.
The divisions are along all kinds of lines, so there is overlap. But, it still means that there are schools of thought, just as there always have been... it isn't all good or all bad; there are pros and cons, and its probably inevitable.
Anyway, I was hoping for some thoughts on which of these schools are on the rise and which are receding... I guess I got some.
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My comment came out pretty messy before, but my point is this: isn't there still a division which results in a situation where economists kind of defend their turf?
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