Peter Söderbaum starts our blog preparing our RLF workshop 28.-30. 10.2011
THE ECONOMIST AS POLITICAL ACTOR
Many establishment actors and other people have become accustomed to think of science and politics as being separate and separable. In the case of economics, it is argued that the economist is standing outside society and the economy watching what goes on in an alleged value-neutral manner. This view is mediated in mainstream textbooks, such as Gregory Mankiw’s Principles of Economics (2008) and is connected with arguments about economics being no different from physics and other natural sciences.
The idea of objective science and the scholar as neutral observer is connected with positivism among theories of science. There is a role for positivism as a theory of science but limiting the view of theories of science to positivism is a problem. Even positivism as an idea of doing science has to be carefully scrutinized. In the case of economics, Gunnar Myrdal has pointed to the fact that “values are always with us” (1978 p. 778) as students of economic phenomena. The economist is faced with a large number of choices relating to the problem to be dealt with, theoretical perspective, method to be applied, ways of presenting results etc. and in the choices made values are implied.Mainstream neoclassical economists have not accepted this view that theoretical perspectives, methods, ways of presenting results are specific in value or ideological terms. One can only speculate about the reasons for sticking to the traditional idea of politics as being separable from economics. Admitting that politics is involved from the very beginning of economic analysis would threaten the role of the economist as expert in a traditional sense. Recognition of the ideological and political specificity of any approach would on the other hand make the economist a more modest person, an actor that has to carry out analysis in ways that respect fundamental imperatives of democracy.
With positivism follows a number of ideas, such as the one that ideology and ideological debate belongs to the realm of politics and should not be discussed by economists and other scientists. Some authors, even those who clearly are concerned about environmental issues and sustainable development, are eager to assure readers that their perspective is “pragmatic and non-ideological” (Nolan 2009 p.7). Nolan is criticizing what he refers to as “wild capitalism”. How can criticism of that kind be “non-ideological”? Bryan Norton in his book Sustainability. A Philosophy of Adaptive Ecosystem Management (2005) tells us about his goal “to explore ways to avoid posing problems in ideological terms” (p. x). Both authors are working in a US context where ‘ideology’ often seems to be connected with ‘fundamentalism’ or similar concepts.
In what follows I will think of ideology broadly as ‘ideas about means and ends’ or ‘means-ends philosophy’. The perspective is similar to the above reference to Myrdal but rather than speaking of ‘values’ I will refer to ‘ideology’. The existence of ideology or ideological orientation is regarded as a necessary fact of life. Political parties refer to ideologies and repeatedly try to articulate and reformulate what they stand for. In relation to specific phenomena, such as economic growth in GDP-terms or in relation to beliefs in markets, one may speak of ‘growth ideology’ or ‘market ideology’.
While the word ‘ideology’ is avoided by Mankiw and in other mainstream neoclassical textbooks, I will here rather share the perspective of Daniel Fusfeld, a respected author of texts about the history of economic ideas:
“One of the great themes in the development of economics, then, is the interaction of ideology and theory. Without ideological conflict the discipline would not have evolved as it did. And because economics was forged in the fire of ideological debate, it will arouse emotion, no matter how ‘pure’ and ‘scientific’ its representatives may try to keep it.” (Fusfeld 1994, p.3)
In terms of paradigm, neoclassical economists stick to neoclassical theory and vigorously defend their monopoly at university departments of economics. At the same time, they defend and indeed propagate the ideology that is built into neoclassical theory. To the extent that debate about paradigm in economics and ideology are systematically avoided, we are in problem. Contrary to such behavior I believe that issues of paradigm and ideology have to be systematically opened for dialogue. Only pluralism is compatible with a democratic society. Why should university departments of economics be limited in terms of paradigm and ideology? Other university departments in social sciences, such as those of economic history, management science, psychology, sociology, political science etc. may have their problems but are significantly better than economics in terms of pluralism. They are therefore closer to normal ideas of democracy.
While ideology has mainly been used at a collective level for political parties, specific parts of the business community, or specific environmental movements, I will refer to ideology or rather ‘ideological orientation’ also at the level of individuals. The logic then is that if there is ideology at the collective level then something similar must exist also at the level of individuals. University scholars, for example, must be free to think in ideological terms differently from the mainstream. If they do so they may contribute to a strengthening of democracy while being loyal and obedient to neoclassical dictatorship would have the opposite impact.
But reference to democracy should not be understood as opening the doors for all kinds of political pamphlets from university scholars. Researchers have to observe normal imperatives of democracy in their work. Indeed, the wish to strengthen democracy will provide a new set of ideas of “excellence” in doing research. But this is an issue that has to be discussed at some future occasion.
Some implications of Political Economic Person assumptions
Does it matter if we understand individuals on the basis of Economic Man assumptions (as neoclassical economists do) or in terms of Political Economic Person assumptions? I think it does.
Looking upon the individual as political actor guided by her ideological orientation, points to the importance of investigating the orientation of establishment actors and other actors. How do they understand sustainable development, for example? Neoclassical economists regard preferences of individuals as given and thereby avoid some of the problems that need to be the subject of research.
Referring to politics and ideology suggests that democracy is important. Economics has to become democratized (Söderbaum and Brown 2010). Tensions between different scholars and groups of scholars should be seen as strengthening democracy (Mouffe 2005) rather than a problem. Textbooks in economics that do not seriously deal with issues of ethics and ideology become less relevant. Similarly different ways of strengthening democracy should be discussed in economics textbooks used in different parts of the world.
Positivism and neoclassical economics can be seen as a way of attempting to avoid responsibility by reference to value-neutrality and the like. Exclusive reliance on positivism becomes a limited liability doctrine comparable to similar doctrines in business. For universities a University Social Responsibility (USR) should be discussed much like the present debate about Corporate Social Responsibility (CSR).
There are certainly other implications that can be discussed by shifting from Economic Man to Political Economic Person assumptions. I believe that economics will become a more exciting science if it moves away from monism to pluralism and from technocracy to democracy. Relationships between scholars will be more relaxed and tolerant. Perhaps also relationships between scholars and other actors in society will improve.
Assuming that ‘democratizing economics’ represents a step forward, a lot certainly remains in terms of moving from the present position of monopoly for neoclassical theory and ideology towards new states of the world. What can be done to initiate and strengthen such a process?
References:
Fusfeld, Daniel R. 1994. The Age of the Economist (Seventh edition). Harper Collins, New York.
Mankiw, Gregory N. Principles of Economics (Fifth edition). South-Western CENGAGE Learning.
Mouffe, Chantal, 2005. On the Political. Routledge, London.
Myrdal, Gunnar, 1978. Institutional Economics. Journal of Economic Issues, Vol. 12, pp.771-783.
Nolan, Peter, 2009. Crossroads. The end of wild capitalism & the future of humanity, Marshall Cavendish, London.
Norton, Bryan G. 2005. Sustainability. A Philosophy of Adaptive Ecosystem Management. University of Chicago Press, Chicago.
Söderbaum, Peter and Judy Brown, 2010. Democratizing economics. Pluralism as a path towards sustainability. Annals New York Academy of Sciences, Volume 1185, Ecological Economics Reviews, pp. 179-195.