Economists not mechanics

However, in bad times, as we are experiencing now, the citizenry becomes increasingly interested in the comments and advice of the gatekeepers of economic wisdom — economists.

But when thrust into the spotlight, economists reveal something about their discipline that most of us tend to otherwise forget — economists don’t always agree on economic policy.

Some citizens, who may be uneasy about the future of our economy, experience a heightening of this malady as a result of the lack of unanimity in the economics profession.

Furthermore, the squabbling among economists over policy alternatives can be downright disturbing. It often comes as a rude surprise to the person in the street, who, although paying due professional respect to economists, still sees the economist as a sort of mechanic.

When your car does not start, you expect that the diagnosis of the problem by one mechanic will be the same given by another mechanic.

The moral of this comparison is that the study of economics is much more than studying a repair manual, and economists are certainly not mechanics.

How is such disagreement possible? Is not economics called a science? Economists’ answers to the last question varies. Some point out that economists attempts to understand the social world from a particular standpoint.

They do this by adopting the values (objectivity, accuracy, open-mindedness, verifiability) and methods (observation, formulation and testing of hypothesis, acceptance or rejection of hypothesis) used in other fields of science. This part of economics, often termed “positive economics” by economists, is concerned with developing and using fundamental principles.

Because it deals with “what is” and not “what ought to be,” positive economics takes no particular ethical position and makes no value judgment. Controversies over positive statements in economics are settled by logical argument and an appeal to the facts.

Other economists contend that the claim that economics is a science is an exaggerated one for two reasons.

Firstly, unlike other scientists, economists are severely limited in their ability to set up laboratory experiments to replicate real-life conditions.

For economists, their laboratory is the real world and the real world is very complex.

After all, what happens in the real world is the result of human behaviour and human beings are not simple creatures.

Secondly, economists, like other social scientists, are called on to answer a question not asked of those in the pure sciences: What ought to be? Astronomers, for instance, are not asked what ought to be the gravitational relationships of our universe. That would be an absurd question.

Economists, on the other hand, cannot avoid, for example, making decisions about optimal output, optimal prices, optimal income distribution, and so on. Once economists step out of the secure world of facts and theory and enter into the realm of “what ought to be” or policy economics, controversy is bound to arise.

Disagreements over statements about what is “good” or “bad”and what is “right” or “wrong” are not easily settled.

More bluntly, as a study of human behaviour from a particular viewpoint, economics is never free of value judgments.

But to say that economists hold a confusing bunch of opinions is to miss a significant point. All opinions are not of equal value. Some are valuable or good whereas others are worthless or bad, and they have both present and future consequences.

As we confront the various problems that bedevil our economy and society and the many policy prescriptions or solutions proposed to deal with them, we must make choices. Some would produce the likely outcomes, others would not. We cannot evade these choices. That is how it is done in a reasoning and democratic society.

Bhagiratty Boodhan Avocat