What economists think about knowledge

I don’t normally bother with other people’s blogposts when they’re so far removed from my own worldview that there’s limited benefit from any engagement. The blogosphere isn’t a marketplace of ideas — it’s an arena for pushing our own pet thoughts, and i’m not conceited enough to think that i’ll change many other people’s minds. But as it happened just as I was writing about economics and its view of knowledge a doctoral candidate at American University called Daniel Kuehn wrote a short piece about why economists shouldn’t do epistemology, which is the study of knowledge. He thinks it’s circular and therefore pointless because it is knowledge about knowledge.

How would one know if one’s got it? How can you even go about getting it if you don’t know what knowledge is in the first place? How would you know about the quality of your knowledge of knowledge? Epistemology is an awfully silly endeavor, if you think about it.

As the first commenter points out, lots of philosophers think about our relationship to knowledge: Plato, Descartes, Kant, Popper, whoever. The term epistemology originated in the early 19th century with a Scottish philosopher called James Frederick Ferrier.

Kuehn, however, thinks they were wasting their time. I wrote on his blog: “In economics it’s certainly acceptable to do epistemology — a non-circular definition might be “thinking about knowledge”. In fact I think that much more epistemological discussion should take place. Why? So much of what passes for economic knowledge has turned out to be questionable, largely as a result of the global economic crisis. Many economists are beginning to understand the difficulties with the knowledge that the mainstream of the discipline has produced (the prominent economists who’ve partially or fully recanted include Stiglitz, Krugman, DeLong, Wolf, Buiter, etc. etc.) It seems sensible to do things like thinking about how we achieved our knowledge and how to make the process of knowledge-generation better in future. This is part of healthy scientific endeavour. We should do much more methodology, too.”

Kuehn replies:

This is fine as far as it goes, but as I’ve noted to other people this sort of thing isn’t really getting into epistemology at all. This is economists thinking a little harder than they did before about methodology. And that’s fine. But there is no new foundational knowledge to ground our claims as true knowledge from any of this soul searching. Nobody in economics or any other science is ever in pursuit of this foundational truth. Nobody cares about that, and the absence of a foundational proposition or “basic belief” hasn’t seemed to do science all that much harm, and that’s my point. It’s not clear there is one. It’s not clear we could know it if there was one. It’s not clear we’d know we had it if there was one and we had it.

If we’re not grounding knowledge in these “basic beliefs” – if our talk is in this way untethered (and we’re not concerned with doing anything about it), then what this untethered talk really is is methodology. And that’s a fine thing to talk about.

The passage is worth quoting because his discussion is self-contradictory. It is epistemology. He’s talking about the possibility or otherwise of knowing about knowledge.

He seems to be under the mistaken impression that epistemology is conducted so as to establish more secure foundations of economic knowledge. That’s overcomplicating matters. It’s just a case of standing back and making observations about what knowledge is, how we can get it and how much can be known about a particular thing.

It’s also weird to suggest that: “Nobody in economics or any other science is ever in pursuit of this foundational truth.” Yes, they profoundly are. In philosophy there’s even a term known as foundationalism, which is the idea that the world is has an independent underlying character which has nothing to do with our conception of it. It holds that science is constructed on logic and sense experience.

Scientists, including many economists, of course routinely make statements about what the world is like, and they’re pretty confident — albeit maybe with a chink of provisionality — about their findings, not to mention their methods. Volcanoes erupt magma. Chlorophyll is a green pigment. Economists usually say things like all other things being equal, a higher price will lead to an increase in supply (although i’d say that sort of statement is much less certain than the other two). A typical view of macroeconomics comes at the beginning of my undergraduate textbook by Greg Mankiw: “Macroeconomists are the scientists who try to explain the workings of the macroeconomy as a whole… as you will see, we do know quite a lot about how the economy works.”

Kuehn’s view is only even worth bothering with because it’s typical of the way economists tend to think about their discipline, which is as a reasonably coherent system that has come close to a true assessment of what the world’s actually like and is gradually accruing new discoveries. They don’t seem to think there’s much need to think deeply about how to do economics or the way it conceives of its own forms of knowledge because they imagine things are broadly on the right track. This view probably originated in written form with Irving Fisher. Fisher’s view, endorsed by Bank of England governor Mervyn King, is that: “students of the social sciences, especially sociology and economics, have spent too much time in discussing what they call methodology.” More recently Frank Hahn said that economists should “give no thought at all to ‘methodology'” (before himself giving lots of thought to methodology). I remember a professor in my department, upon learning that I was studying economic methodology, suggesting that it wasn’t worthwhile and that methodologists should pay rather than be funded for the privilege of  studying their subject, since it’s just a luxury.

Kuehn is unusually open to methodology, which is unusual among economists, but he doesn’t seem to realise that epistemology and methodology are closely linked. You’re probably going to say things about knowledge if you are going to make statements about method.

It would be arrogant to preach to the many thousands of accomplished economists about what they should be doing. But as I mentioned above, profound questions arose preceding, during and after the global economic crisis about the things that economics professes to know about the economy and the way that it sets about achieving that knowledge. Few mainstream economists saw the crisis coming. Their ways of doing economics couldn’t even really cope with big snafus. Many of the big hitters have begun to rethink some of their most basic views, and new disciplines – behavioural, experimental, neuroeconomics, econophysics – have sprung into existence.

I’m not suggesting that economists should spend all their time in smoky cafes blethering about the nature of reality. They should get on with the job like most scientists do. But economics degrees should involve a bit of methodology or epistemology, unlike now. Economists might at least spend a fraction of their time — especially at the current juncture — reflecting on whether the discipline really is on the right track.

Maybe i’m being harsh on a student who’s yet to learn. But the problem is that many economists don’t learn. It’s awfully silly, if you think about it.