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The McCloskey critique refers to a critique of post-1940s "official modernist" methodology in
economics Economics () is the social science that studies the Production (economics), production, distribution (economics), distribution, and Consumption (economics), consumption of goods and services. Economics focuses on the behaviour and intera ...
, inherited from
logical positivism Logical positivism, later called logical empiricism, and both of which together are also known as neopositivism, is a movement in Western philosophy whose central thesis was the verification principle (also known as the verifiability criterion o ...
in philosophy. The critique maintains that the methodology neglects how economics can be done, is done, and should be done to advance the subject. Its recommendations include use of good rhetorical devices for "disciplined conversation."


Substance

Deirdre McCloskey Deirdre Nansen McCloskey (born Donald N. McCloskey; September 11, 1942 in Ann Arbor, Michigan) is the distinguished professor of economics, history, english, and communication at the University of Illinois at Chicago (UIC). She is also adjunct pr ...
's 1985 book ''The Rhetoric of Economics'' argues that "The Mathematization of Economics Was a Good Idea", but that "economic modernism" took equilibrium
model A model is an informative representation of an object, person or system. The term originally denoted the Plan_(drawing), plans of a building in late 16th-century English, and derived via French and Italian ultimately from Latin ''modulus'', a mea ...
-building and
econometrics Econometrics is the application of Statistics, statistical methods to economic data in order to give Empirical evidence, empirical content to economic relationships.M. Hashem Pesaran (1987). "Econometrics," ''The New Palgrave: A Dictionary of ...
(especially " existence-theorem" mathematics, and
statistical significance In statistical hypothesis testing, a result has statistical significance when it is very unlikely to have occurred given the null hypothesis (simply by chance alone). More precisely, a study's defined significance level, denoted by \alpha, is the p ...
) "absurdly" far. Roughly speaking McCloskey wants economics to make interesting, new, and true statements about the real world, and argues that proving the hypothetical possibility of an effect within an analytical framework is not a constructive way of doing this. Although the conventional way of connecting the economic model with the world is through econometric analysis, she
cites CITES (shorter name for the Convention on International Trade in Endangered Species of Wild Fauna and Flora, also known as the Washington Convention) is a multilateral treaty to protect endangered plants and animals from the threats of interna ...
many examples in which professors of econometrics were able to use the same data to both prove and disprove the applicability of a model's conclusions. She argues that the vast efforts expended by economists on analytical equations is essentially wasted effort. In "Ask What the Boys in the Sandbox Will Have", McCloskey identified the economists whom she accuses of leading
economics Economics () is the social science that studies the Production (economics), production, distribution (economics), distribution, and Consumption (economics), consumption of goods and services. Economics focuses on the behaviour and intera ...
astray in the 1940s: #
Paul Samuelson Paul Anthony Samuelson (May 15, 1915 – December 13, 2009) was an American economist who was the first American to win the Nobel Memorial Prize in Economic Sciences. When awarding the prize in 1970, the Swedish Royal Academies stated that he "h ...
: In her view, Samuelson wanted economics to resemble more closely the hard sciences (especially
physics Physics is the natural science that studies matter, its fundamental constituents, its motion and behavior through space and time, and the related entities of energy and force. "Physical science is that department of knowledge which r ...
), and elevated the "vice" of "blackboard proofs" and other mathematical (but not necessarily scientific) values to accomplish this. #
Lawrence Klein Lawrence Robert Klein (September 14, 1920 – October 20, 2013) was an American economist. For his work in creating computer models to forecast economic trends in the field of econometrics in the Department of Economics at the University of Penn ...
was the
econometrician Econometrics is the application of statistical methods to economic data in order to give empirical content to economic relationships.M. Hashem Pesaran (1987). "Econometrics," '' The New Palgrave: A Dictionary of Economics'', v. 2, p. 8 p. 8 ...
she says is responsible for the modern "mistake" of confusing statistical significance with scientific significance. #
Jan Tinbergen Jan Tinbergen (; ; 12 April 19039 June 1994) was a Dutch economist who was awarded the first Nobel Memorial Prize in Economic Sciences in 1969, which he shared with Ragnar Frisch for having developed and applied dynamic models for the analysis of ...
she considers responsible for the third vice of
social engineering Social engineering may refer to: * Social engineering (political science), a means of influencing particular attitudes and social behaviors on a large scale * Social engineering (security), obtaining confidential information by manipulating and/or ...
, which is based on the other two. McCloskey says that this presumes to know more than it can, and raised the prestige of the mathematical "modernist methodology" above other ways of performing economics. Her complaint against the modern profession, and against the
Bank of Sweden Prize in Economic Sciences in Memory of Alfred Nobel The Nobel Memorial Prize in Economic Sciences, officially the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel ( sv, Sveriges riksbanks pris i ekonomisk vetenskap till Alfred Nobels minne), is an economics award administered ...
winners above, has provoked a strong defense from the economic mainstream. It has led to debates with such figures as
Kenneth Arrow Kenneth Joseph Arrow (23 August 1921 – 21 February 2017) was an American economist, mathematician, writer, and political theorist. He was the joint winner of the Nobel Memorial Prize in Economic Sciences with John Hicks in 1972. In economics ...
, who vigorously support the "Samuelson" approach, and argue that the quantity of analytical
mathematical model A mathematical model is a description of a system using mathematical concepts and language. The process of developing a mathematical model is termed mathematical modeling. Mathematical models are used in the natural sciences (such as physics, ...
s in modern economics is a critical requirement for progress. However, McCloskey acknowledges the virtues as being born from each man's "genius", and rather blames the vices as being created not by these three Nobel economists, but by their students and their students' students, including herself.


The diagnosis and solution

McCloskey says that most economists when they write are " tendentious", assuming that they know already, and concentrating on a high standard of
mathematical proof A mathematical proof is an inferential argument for a mathematical statement, showing that the stated assumptions logically guarantee the conclusion. The argument may use other previously established statements, such as theorems; but every proo ...
rather than a "scholarly" accumulation of relevant, documented facts about the real world. The advice she offers colleagues here is to spend more time in the archives, and write more heavily researched papers from specific observations in the real world (she argues that this is the norm in the natural sciences on which economics believes it is modelling itself, but that most economics practitioners actually base their methodology more closely on pure
mathematics Mathematics is an area of knowledge that includes the topics of numbers, formulas and related structures, shapes and the spaces in which they are contained, and quantities and their changes. These topics are represented in modern mathematics ...
). Since she says: "No one really believes a scientific assertion in economics based on statistical significance" the solution she proposes to establishing cause and effect in economics is "calibrated
simulation A simulation is the imitation of the operation of a real-world process or system over time. Simulations require the use of Conceptual model, models; the model represents the key characteristics or behaviors of the selected system or proc ...
". Calibrated simulation relies on measurement and numerical techniques (such as
Monte Carlo method Monte Carlo methods, or Monte Carlo experiments, are a broad class of computational algorithms that rely on repeated random sampling to obtain numerical results. The underlying concept is to use randomness to solve problems that might be determi ...
s) to test the robustness of its predictions, without requiring a closed-form solution proving that the postulated relationship will always hold (or will be reached in " equilibrium", or be
impossible Impossible, Imposible or Impossibles may refer to: Music * ''ImPossible'' (album), a 2016 album by Divinity Roxx * ''The Impossible'' (album) Groups * The Impossibles (American band), a 1990s indie-ska group from Austin, Texas * The Impossibl ...
). As an illustration, she contrasts the
Babylonia Babylonia (; Akkadian: , ''māt Akkadī'') was an ancient Akkadian-speaking state and cultural area based in the city of Babylon in central-southern Mesopotamia (present-day Iraq and parts of Syria). It emerged as an Amorite-ruled state c. ...
n and
Greek Greek may refer to: Greece Anything of, from, or related to Greece, a country in Southern Europe: *Greeks, an ethnic group. *Greek language, a branch of the Indo-European language family. **Proto-Greek language, the assumed last common ancestor ...
"
rhetoric Rhetoric () is the art of persuasion, which along with grammar and logic (or dialectic), is one of the three ancient arts of discourse. Rhetoric aims to study the techniques writers or speakers utilize to inform, persuade, or motivate parti ...
" used to back up the claim that the square on the
long side Long Side is a fell in the English Lake District, it is situated six kilometres north west of Keswick, Cumbria, Keswick in the northern sector of the national park and is part of the Skiddaw group of fells. Long Side which reaches a height of 73 ...
of every right angle triangle has the same area as the sum of squares on the other two sides: While Greek
geometry Geometry (; ) is, with arithmetic, one of the oldest branches of mathematics. It is concerned with properties of space such as the distance, shape, size, and relative position of figures. A mathematician who works in the field of geometry is c ...
found a 'universal proof', the Babylonian engineers simply measured the sides of a thousand right triangular stones, and applied the
heuristic A heuristic (; ), or heuristic technique, is any approach to problem solving or self-discovery that employs a practical method that is not guaranteed to be optimal, perfect, or rational, but is nevertheless sufficient for reaching an immediate, ...
that since all of these obeyed the relationship so would the rest. McCloskey believes that the Babylonian approach is more applicable to economics, and that
Moore's Law Moore's law is the observation that the number of transistors in a dense integrated circuit (IC) doubles about every two years. Moore's law is an observation and projection of a historical trend. Rather than a law of physics, it is an empir ...
and advances in modeling
software Software is a set of computer programs and associated documentation and data. This is in contrast to hardware, from which the system is built and which actually performs the work. At the lowest programming level, executable code consists ...
will soon make it easier to use and understand than the Greek approach. In ''Calibrated Simulation is Storytelling'' she writes that one way to describe scientific theories is how mechanically mathematical they are: at the one end lie such hypotheses as Newtonian
celestial mechanics Celestial mechanics is the branch of astronomy that deals with the motions of objects in outer space. Historically, celestial mechanics applies principles of physics (classical mechanics) to astronomical objects, such as stars and planets, to ...
which can be reduced entirely to equations - at the other are important works such as ''
The Origin of Species ''On the Origin of Species'' (or, more completely, ''On the Origin of Species by Means of Natural Selection, or the Preservation of Favoured Races in the Struggle for Life''),The book's full original title was ''On the Origin of Species by Me ...
'' which are "entirely historical and devoid of mathematical models". McCloskey says that economics would benefit from recalibrating its output within that spectrum to the more historical, "narrative" analysis.


See also

*
Epistemological anarchism Paul Karl Feyerabend (; January 13, 1924 – February 11, 1994) was an Austrian-born philosopher of science best known for his work as a professor of philosophy at the University of California, Berkeley, where he worked for three decades (1958 ...
,
Paul Feyerabend Paul Karl Feyerabend (; January 13, 1924 – February 11, 1994) was an Austrian-born philosopher of science best known for his work as a professor of philosophy at the University of California, Berkeley, where he worked for three decades (1958 ...
's criticism of fixed methodology in the
natural science Natural science is one of the branches of science concerned with the description, understanding and prediction of natural phenomena, based on empirical evidence from observation and experimentation. Mechanisms such as peer review and repeatab ...
s, is often compared with McCloskey's *
Economic history Economic history is the academic learning of economies or economic events of the past. Research is conducted using a combination of historical methods, statistical methods and the application of economic theory to historical situations and ins ...


Notes


References

* 1983. McCloskey, D.N. "The Rhetoric of Economics," ''Journal of Economic Literature'' 21(2), pp. 481–517
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. * 1986 McCloskey, D.N. ''The Rhetoric of Economics'', University of Wisconsin Press; 2nd ed. (1998) (First ed. written as Donald McCloskey, leading to occasional confusion in pronouns.
2nd ed. preview.
* 1995 Mäki, U. ''Diagnosing McCloskey'', and McCloskey, D.N. ''Modern Epistemology Against Analytic Philosophy: A Reply to Mäki'', ''
Journal of Economic Literature The ''Journal of Economic Literature'' is a peer-reviewed academic journal, published by the American Economic Association, that surveys the academic literature in economics. It was established in 1963 as the ''Journal of Economic Abstracts'',
,'' XXXIII(3) September (1300-1323) * 1995 McCloskey, D.N. ''Calibrated Simulation is Storytelling'' ''
Scientific American ''Scientific American'', informally abbreviated ''SciAm'' or sometimes ''SA'', is an American popular science magazine. Many famous scientists, including Albert Einstein and Nikola Tesla, have contributed articles to it. In print since 1845, it i ...
'' (reprinted as ''Simulate, Simulate; Calibrate, Calibrate'' in ''How to be Human*'') * 1996 McCloskey, D.N. ''Ask what the boys in the Sandbox Will Have'', ''
Times Higher Education Supplement ''Times Higher Education'' (''THE''), formerly ''The Times Higher Education Supplement'' (''The Thes''), is a British magazine reporting specifically on news and issues related to higher education. Ownership TPG Capital acquired TSL Education ...
'' (London), reprinted in the introduction to ''The Vices of Economists-The Virtues of the Bourgeoisie'' * 2000 McCloskey, D.N. ''How to be Human* : *Though an Economist'', University of Michigan Press, (essays for the economic layman on many subjects from Eastern Economic Journal, and her analysis of the profession's treatment of her critique.) {{Positivism Economic methodology Criticisms of economics