economics gets social

It was students themselves who first sounded the warning bell that economics as a science was problematic and needed urgent reform.

Economics has met the enemy, and it is economics - The Globe and Mail:

"They wouldn't be the first young dissenters to call economics to account. In June of 2000, a small group of elite graduate students at some of France's most prestigious universities declared war on the economic establishment. This was an unlikely group of student radicals, whose degrees could be expected to lead them to lucrative careers in finance, business or government if they didn't rock the boat. Instead, they protested – not about tuition or workloads, but that too much of what they studied bore no relation to what was happening outside the classroom walls.

They launched an online petition demanding greater realism in economics teaching, less reliance on mathematics “as an end in itself” and more space for approaches beyond the dominant neoclassical model, including input from other disciplines, such as psychology, history and sociology. Their conclusion was that economics had become an “autistic science,” lost in “imaginary worlds.” They called their movement Autisme-economie." 

 John Kay engraving
Library of Congress
public domain
via Wikimedia Commons

Social is here to stay: it looks like Adam Smith knew all about social networks, a fact economics seems to have lost track of. I suppose we can now believe in the invisible handshake.

The Best Fiscal Stimulus: Trust - Miller-McCune:

"Zak acknowledges that talk of trust and generosity seems to contradict what Adam Smith had to say in The Wealth of Nations, the economists’ bible, when he advocated for free markets that allowed each individual to act in his or her own self-interest. A popular interpretation of that book is that in a free market, economic interactions are all about dog-eat-dog competition — a Darwinian struggle for survival.

Zak calls The Wealth of Nations Smith’s “second-best book,” pointing out that the Scottish thinker had published an earlier work titled The Theory of Moral Sentiments (1759) that described how moral behavior arises naturally from social interactions and provided one of the earliest published descriptions of empathic feeling. Clearly, Smith’s take on all this was more nuanced than is commonly supposed."