The economists have no clothes

Over at The Atlantic, Gregory Clark admits, rather refreshingly, that academic economists have no clothes.

The current recession has revealed the weaknesses in the structures of modern capitalism. But it also revealed as useless the mathematical contortions of academic economics. There is no totemic power.

As a discipline, economics proposes models, which are by definition incomplete. That is, they exclude some details and highlight others. To think that economic theories actually describe reality--as opposed to offer an image of reality that is useful for some purposes--is to mistake the map for the world.

Ceci n'est pas le monde.

Further, the dismal science has all too often provided models whose validity is impossible to ascertain, since it has often built its theories on the basis of premises that are false prima facie. The point here is that, logically speaking, false premises do not yield false conclusions; rather, false premises render the truth values of an argument's conclusions indeterminate. It isn't that economic models are false, but rather that the falseness of their premises means that can know nothing with certainty about their conclusions. We can't say whether economic models are true, false, or some determinate mix of the two. Logically speaking, they're mere speculation, with the same logical status as wishful thinking.

You mean we came all this way and we don't even know if we're wrong?

For example, the theories of classical economics generally accept as axioms (i.e., they accept as true without argument) the following:

1. All economic actors are rational.
2. All economic actors have perfect information about the markets in which they act.
3. All resources are scarce.

These are bad axioms, since they're obviously not true. As in, there's no doubt at all that these are false. Of course, not all branches of modern economics still accept these premises without qualification, but historically speaking these assumptions lie at the foundation of all economic thought. This is precisely the main reason I never studied economics in college. Who can take seriously a discipline that, wherever it ends up, begins with nonsense? While there's no doubt that the phenomena we think of as economic are intrinsically interesting, I remain skeptical that the formal discipline of economics has a great deal to offer beyond the obvious. As Clark notes:

The debate about the bank bailout, and the stimulus package, has all revolved around issues that are entirely at the level of Econ 1. What is the multiplier from government spending? Does government spending crowd out private spending? How quickly can you increase government spending? If you got a A in college in Econ 1 you are an expert in this debate: fully an equal of Summers and Geithner.

Common sense cloaked in jargon and equations. Even the economists' invisible clothes look rather shabby these days.

The first rule of student engagement

I'm in Québec City right now, attending a 5-week intensive program in French Language immersion. One of the options I've chosen is an introductory survey course on Quebecoise literature. There are only a dozen students in the course, so the teacher said she'd like to run the class more as a seminar and less as a lecture. Which sounded great--but it turns out our teacher doesn't seem to know how to run a discussion (not an uncommon failing among teachers). She doesn't seem to grasp the first rule of student engagement--actually, the first of intellectual engagement in general. And that rule is this:

People engage with ideas on the basis of what they already know.

The technicalities of revolution are, as everyone who attended the party found out, pretty damn tedious.
(Revolutionary Tedious Party, originally uploaded by abitnice)

This rule has two important practical corollaries:

1. Discussions turn on questions that everyone can answer. Domains where students are largely ignorant offer no footholds for students to establish a stance and launch into a discussion. If you start talking about what you know well, but what your students don't know at all, they won't respond for the simple reason that you're the obvious authority and what you say goes. If you base the discussion in a domain where the students have some knowledge (their own opinions are painfully dependable as a point of departure), you'll be able to introduce the topics you want to cover without killing the conversation.
   
2. Technicalities kill engagement. Technicalities are inevitably the province of specialists. If you're talking about technicalities, you'd better be talking to another specialist (or someone who aspires to be a specialist). If you're not, guaranteed you're boring people in a way that makes them just want to break something.
   

Engagement is the foundation of every learning experience. Engagement can only happen when people take what they already know and either reinterpret it or connect it with new knowledge.