There are three possible general reactions to most of my posts on Economic Thought,
- You could be persuaded, or you could already agree with me;
- You could be angered;
- You could be neither persuaded nor angered, just made curious by an interesting problem that you can’t easily solve.
Reactions (1) and (2) are unintended on my part, and I rather you react the way described by (3). Of course, I can’t rule out that some — or all — of my posts simply aren’t insightful, aren’t interesting, or are just obviously wrong, which might justify reactions (1) — although, it would be agreement over something trivial — or (2).
My method of blogging, at least on Economic Thought, bears some relationship to my experience as a student, especially as a student of heterodox economics. This post will include some personal background to help illustrate my general line of reasoning. The topic is also related to the reason I no longer like to be considered a part of an “Austrian” denomination of economics. Some people have asked me about this personal transition, so I will also use this post as an opportunity to write a bit on that, as well.
There is one graph we should all know before I go on (source: SMBC),
I did not know much about economics until 2008, which is when I was introduced to Mises.org, while I was living in Madrid. I became immediately engrossed in the subject. I reached that first peak around 2010, during which the bulk of my Mises.org articles were written. During that time, my thirst for learning was strong, but it was principally motivated as a means of reinforcing my existing convictions. While I made sure to read opposing viewpoints closely, it was mostly intended to avoid criticizing straw men, rather than as a method of looking for weaknesses in my beliefs. I didn’t take my own ignorance seriously. Fortunately, my inclination towards knowing “opposing” intellectual ideas well led to better things.
Heterodox economists like to compare their beliefs to “neoclassical” beliefs. As it turns out, oftentimes it is a comparison between one’s beliefs and what one thinks “neoclassicals” believe. I do not think these comparisons are always wrong, although, even when they are right, they are not always the full story. No (or, very few) economist(s) believes (believe) that a monetary authority can “print wealth.” No economist believes governments are perfect, even when markets are imperfect. Few economists believe that, in general, income inequality caused by differences in marginal productivity is “bad.” Unfair characterization of the ideas you disagree with is not a sin only heterodox economists commit, of course. But, these were problems I was directly aware of, because the main sources I was reading were heterodox. For what it is worth, what turned me off heterodoxy, in general, was not anything Austrian, but actually Steve Keen’s Debunking Economics — I am not sure how anyone can take that book seriously (to be fair, I was originally less critical of Keen’s work).
Reading “neoclassical” literature — and, the truth is that the “neoclassical” tradition is much broader than what that moniker suggests — made me realize that there is much more merit in it than many heterodox economists give it credit for. Non-heterodox economists (i.e. the majority) are not fools who are missing basic truths. Indeed, I have learned much more from non-heterodox sources than I have from Austrian or Post Keynesian literature (which does not mean that there is nothing to learn from these latter two — the opposite is closer to the truth). The most important thing I learned, in any case, is that if you think you have an easy case as to why a professional economist is wrong, you are probably making an error. A rule of thumb: given that the analytical capabilities of the average economist is high, what is mainstream (what the majority of economists accept) is a good indication of what is closer to the truth. This is not always true — sometimes good ideas are not sold well, and bad ideas are sold too well —, but it generally is.
Need specific examples of non-heterodox work of great merit? Take a look at, for instance, my summaries and suggested interpretations of some “mainstream” theories: Alchian and Demsetz on information costs, monitoring, and the firm (“Alchian’s Calculation Problem“); Akerlof on information asymmetry and markets (“How to Read ‘Market for Lemons‘”); and Krugman’s economies of scale theory of trade (“Krugman’s Alternative Theory of Trade“). It is also worth remembering that something having merit does not mean that you have to agree with it, or agree with all of it. Consider, for example, my review of Stiglitz’ The Price of Inequality. And, just because you agree with something does not mean you should not question it. Consider, for example, the challenge I pose (in my review) to one of Hutt’s conclusions drawn in The Theory of Idle Resources — specifically, I am not sure that Hutt actually addresses the “Keynesian” concern.
Exposure to “opposing” viewpoints should lead you to become aware of at least two things,
- The merit in ideas you might disagree with, either in part or completely;
- The possibility of error in your own set of beliefs.
(1) allows you to recognize that many ideas are worth knowing, even if they make you uncomfortable. You do not have to agree with others’ interpretations, you do not need to agree with others’ conclusion, but recognizing that there is much to know packaged in literature that you might not agree with overall helps you pick out the good from the bad, allowing you to refine your set of beliefs. Again, this refinement need not be in the direction the author wants you to go in, but it is a direction that you otherwise would have taken had you not read what you are uncomfortable in.
(2) should make you more open to embracing discomfort. If you recognize that the probability of you not knowing everything, and especially not knowing enough to conclusively reach a determined belief on something, is high enough, you will be more open to reading ideas that contradict your own. This overlaps with (1). Reading ideas that make you uncomfortable, because they make you question what you know, takes you in directions that you otherwise would not have had the opportunity to follow.
That “going in a different direction” is not the same thing as “being persuaded” needs to be stressed. I am a very skeptical person, and I am rarely directly persuaded. Those of you who are charitable enough to comment on my blog, and especially to have a dialogue with me, are probably well aware of this. What I do, rather, is soak in disagreement, think it over for some (often indeterminate) amount of time, and change my views “on my own.” That is, I use my own analytical skills to pick apart the ideas I come across, and I shape my views around what I think is right, or even can be right. Being aware of my own cognitive limitations and of the merit of others’ ideas (even when they are not aligned with my own), however, makes this process much more open. I think this is a good thing. Further, I think our natural inclination to stick with ideas we know, and therefore are comfortable with, is a good weight against “openness.” Meaning, while it is true that there is such a thing as being “too open,” and there is such a thing as being “too skeptical,” the natural tendency to be much less skeptical of what you already believe in makes being “too open” or “too skeptical” practically impossible.
Nozick’s Anarchy, State, and Utopia embodies what I am trying to get at, so allow me to embark in a productive digression. Ask any person who attended last week’s seminar on Nozick’s book and they will confirm the following: I do not agree with many of Nozick’s arguments, and I especially disagree with his main assumptions and conclusions. But, I cannot deny that Anarchy, State, and Utopia is a great book of much merit. Neither can I deny that Nozick’s book will influence the direction of my beliefs.
From what I understand, most libertarians would also disagree with many of Nozick’s arguments. One could convincingly make the case that there are more influential (on fellow libertarians) libertarian political philosophers out there: Rothbard, Hayek, Gaus, et cetera. Yet, Anarchy, State, and Utopia is the source that non-libertarians go to on libertarianism. One reason for this is probably that Nozick was a Harvard professor, and what is most interesting about his book is his critique of Rawls. Another reason — in my opinion, perhaps more important — is Nozick’s exploratory approach to the subject. His intention is not necessarily to persuade you, but to cause you to question your priors (although, in my opinion, he applies this method asymmetrically; i.e. he does not question his own priors as much as he does those of others). Much of the book involves problematizing common approaches to moral intuition: utilitarianism, Rawlsian liberalism, et cetera. It makes you think; you find reason to question your beliefs, which motivates you to explore the problems he delineates. He might not be persuasive, but he will take your thinking in new directions.
One view about how to write a philosophy book holds that an author should think through all of the details of the view he presents, and its problems, polishing and refining his view to present to the world a finished, complete, and elegant whole. This is not my view. At any rate, I believe that there also is a place and a function in our ongoing intellectual life for a less complete work, containing unfinished presentations, conjectures, and open questions and problems, leads, side connections, as well as a main line of argument. There is room for words on subjects other than last words.
— Nozick (1974), p. xii.
I would take one step further and claim that finished, complete, and elegant wholes are impossible. If we think we have something of that nature, we are falling victim to an illusion.
This is the approach I take on my blog. Consider, specifically, my recent discussion of government, exchange, and libertarianism. I ask whether libertarians suffer from a fatal conceit when judging the merits to non-market institutions of governance. I wonder if large, “centralized” states make sense, even with perfectly plural political institutions. Finally, I make the strong claim that libertarians should be more cognizant of their biases. I am not trying to persuade anybody of my ideas. I am not even completely swayed. Rather, these are frictions on my own thinking, and I think they are applicable to the thinking of others’. I am problematizing beliefs that I find, or (in many case) once found, persuasive. My hope is that these issues are interesting and plausible, and that they will make you, my reader, join me on an exploratory journey.
Should you feel anger towards me, or anybody else who says or writes something that you, with your given set of priors, disagree with? What I mean by “anger” is any emotion that drives you to, for example, accuse another of being a “statist” or a “socialist.” Or, any emotion that leads you to reject without seriously considering. I can sympathize with, on some level, anger towards certain ideas. It is hard for me to take an article that links libertarianism to feudalism seriously, for instance. But, generally speaking, an emotion of anger should signal to you the need for caution. Anger is usually caused by discomfort; rejecting something out of anger means rejecting something you are uncomfortable with. That is not a healthy approach to learning. You should control the natural consequences of those emotions — close-mindedness, primarily. You should always judge an idea with some degree of neutrality, because it is from a position of neutrality that you will best be able to distinguish between good and bad ideas.
Learning is exploratory. There is a vast sea of information and knowledge, most of which we are unaware of. Learning — developing our knowledge and our beliefs — is a process that requires accepting that there is a lot we do not know, a lot we do not know that we do not know (radical ignorance, or the “unknown unknown”), and that what we think we know has some probability of being wrong. My blogging style embraces this framework. My intention is not mainly to communicate what I know, but to communicate possible problems with what I think I know and, oftentimes by extension, problems with what you think you know. I am taking you through an exploratory process that I am going, or have gone, through. I hope that this is the way you interpret what I write.