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Economic theory

The facts are capitalist

There has been a curious debate in the past week within the world of economics blogging. It started with a post by Chris House on the contrast between a “well-known liberal bias” within the academy generally and the decidedly more conservative bent of most members of economics departments. House attributes this contrast to a conservative bias in economic facts – by this he means that much of mainstream economic theory agrees with a more right-wing view of the world. Take, for example, the view that minimum wages lower employment or that government regulation has negative effects on business efficiency. Noah Smith answered this  provocation by arguing that the positions taken by most economists are actually closer to the beliefs of the American centre-left, by which he means that much attention is focused on the trade-offs between efficiency and equity. And the debate has moved on from there.

Smith concludes his post by making explicit the key assumption behind both pieces: that there are facts and then there is the ideological perception of those facts – that the facts are in some way neutral, but can conform to one point of view better than another. There is a long line of social theory and philosophy that challenges this assumption of independence. Here, it is tempting to quote Gramsci on ideology, or Foucault on power, or a host of other authors. That would, however, take the conversation into a space completely alien to House and Smith. So nevermind Gramsci, here is mainstream Anglo-American philosopher of science Hilary Putnam on the relation between facts and values:

I argued that the picture of our language in which nothing can be both a fact and value-laden is wholly inadequate and that an enormous amount of our descriptive vocabulary is and has to be ‘entangled’… for example, to draw the distinction between courageous behaviour and behaviour that is merely rash or fool-hardy…depends precisely on being able to acquire a particular evaluative point of view. ‘Valuation’ and ‘description’ are interdependent.