Steven Postrel is guest-blogging at Organizations and Markets. Steve teaches at the Cox School of Business at Southern Methodist University (and also happens to be Mr. Virginia Postrel). I look forward to his contributions to O&M!
Steve’s first guest post tackles the question of “physics envy” in economics and the use of mathematical tools in economics. His opening statement captures some things that I myself have said at various points:
We often hear (sometimes on this blog) that mainstream economics suffers from an excess of mathematical modeling. Supposedly, math is distracting, or misleading, or limits the questions one can study. Occasionally it is asserted that math serves the purpose of disguising the triviality of one’s thoughts, or that it serves as a guild’s protectionist barrier against the worthy but unschooled.
He (and the commenters on the post) then proceed to discuss what I think is an important part of the question: what tools provide clarity and usefulness in understanding the ideas we are exploring? Like any other specialized tool, mathematical models can provide clarity and be useful (although as the statistician George Box said, all models are wrong, but some are useful). For me the skepticism I have about formal, mathematical economic theory is more about whether or not the tail wags the dog. In other words, have we become so enamoured of our tools that we innovate them and focus on them, and then try to drum up economic questions and problems of human action to which to apply them?
I fear that when we let our techniques and our tools drive the types of questions that it is considered acceptable to answer, because only certain methodologies are acceptable (by which I mean publishable in the major journals), that we lose the ability to understand problems for which mathematical tools do not provide as much clarity as other tools (remember, people, we’re economists, so even when it comes to choosing tools we want to bear in mind opportunity cost!).