What is Economics?

The question of the definition and scope of economics has been thrown back and forth for centuries. Clearly Economics is not a science as is Physics or Biology. Perhaps it is akin to Biology in the late 18th century, a set of descriptives of what may be out there but lacking a base of understanding without its DNA.

Skidelsky has written brilliantly over the years on Economics and its history so when he opines it is always worth considering. Skidelsky has recently written on Post Crash Economics and he says:

For starters, economics teaching and research is deeply embedded in an institutional structure that, as with any ideological movement, rewards orthodoxy and penalizes heresy. The great classics of economics, from Smith to Ricardo to Veblen, go untaught. Research funding is allocated on the basis of publication in academic journals that espouse the neoclassical perspective. Publication in such journals is also the basis of promotion. Moreover, it has become an article of faith that any move toward a more open or “pluralist” approach to economics portends regression to “pre-scientific” modes of thought, just as the results of the European Parliament election threaten to revive a more primitive mode of politics.

He continues:

For now, the best that curriculum reform can do is to remind students that economics is not a science like physics, and that it has a much richer history than is to be found in the standard textbooks. In his book Economics of Good and Evil, the Czech economist Tomáš Sedláček shows that what we call “economics” is only a formalized fragment of a much wider range of thinking about economic life, stretching from the Sumerian epic of Gilgamesh to the meta-mathematics of today.Indeed, mainstream economics is a pitifully thin distillation of historical wisdom on the topics that it addresses. It should be applied to whatever practical problems it can solve; but its tools and assumptions should always be in creative tension with other beliefs concerning human wellbeing and flourishing. What students are taught today certainly does not deserve its imperial status in social thought.

He agrees with the lack of scientific clarity. The mathematics all too often just creates shadows to hide behind. The discussion is best focused on what we want our society to hold and what to reject. Clearly the markets are not efficient, they hide information rather than display it. Manipulation is rampant in many ways, often small but profitable ways. Yet the issue is what do we want as a nation, as a people. Skidelsky presents an interesting opening.