Economic enlightenment?

Posted: 10 May 2010 in Uncategorized
Tags: , ,

The answer: the test is rigged!

A recent study by Zeljka Buturovic and Daniel B. Klein, published in Econ Journal Watch (disclaimer: I serve on the Advisory Council) is getting some notice on both the Right and the Left (e.g., by Tyler Cowen, Todd Zywicki, and Matthew Yglesias). According to their research, “economic enlightenment” is not correlated with going to college. Moreover, what they call economic enlightenment is highest among those self-identifying as “conservative” and “libertarian,” and descends through “moderate,” “liberal,” and “progressive.” (Other variables they examine are party affiliation, religious participation, union membership, NASCAR fandom, and Wal-Mart patronage.)

Here are the 8 eight questions (and, according to the authors, the “unenlightened” answers) used in the study:

1. Restrictions on housing development make housing less affordable.
• Unenlightened: Disagree
2. Mandatory licensing of professional services increases the prices of those services.
• Unenlightened: Disagree
3. Overall, the standard of living is higher today than it was 30 years ago.
• Unenlightened: Disagree
4. Rent control leads to housing shortages.
• Unenlightened: Disagree
5. A company with the largest market share is a monopoly.
• Unenlightened: Agree
6. Third-world workers working for American companies overseas are being exploited.
• Unenlightened: Agree
7. Free trade leads to unemployment.
• Unenlightened: Agree
8. Minimum wage laws raise unemployment.
• Unenlightened: Disagree

Many will recognize these questions and answers from standard, neoclassical textbooks in economics. But that’s the problem (of this and all such surveys of correct and incorrect economic reasoning): the questions and answers are rigged. They represent the view of neoclassical economists, and respondents are considered unenlightened if they don’t give the correct, neoclassical answers.

It’s possible to devise a different, correct answer to all these questions. (Take number 6: from a Marxian perspective, Third World workers are being exploited, as are First World workers—as are, for that matter, all workers in capitalist enterprises.)

But that’s not my main point, since I don’t want to defend either what the authors of the study consider to be the correct answers, or the “incorrect” answers given by many of the respondents. My point, rather, is that there are different economic representations—among academic economists and everyday economists, inside academic economics as well as academic disciplines other than economics and outside the academy. They literally use different economic discourses, through which they view such issues as rent control and minimum wages, and of course come up with different answers.

Only the most unenlightened would devise an examination according to which only those answers that correspond to the one given by neoclassical economists are considered correct, and all others incorrect.

  1. alli says:

    All economists are equal, and some economists are more equal than others.

  2. Daniel Klein says:

    David writes:
    “Only the most unenlightened would devise an examination according to which only those answers that correspond to the one given by neoclassical economists are considered correct, and all others incorrect.”

    Are you saying that an answer cannot be correct if it corresponds to that indicate by a standard blackboard story?

    Moreover, at most, only 5 of the 8 questions have a blackboard correspondent.

    Surely you agree with some of our designations of unenlightened answers. Now look at how the left did on THOSE questions.

    “Not sure” responses were reported as not incorrect.

    I’d be open to carrying on a follow-up exchange in the next issue of EJW. If interested, let me know.

  3. David Ruccio says:

    Thanks for taking my critical comments seriously, Daniel. To respond quickly. . .

    No, my view is not that an answer cannot be correct if it corresponds to the standard, neoclassical blackboard story. It’s that it’s only correct when judged according to the assumptions and logic of neoclassical theory. Use another theory, you get a different answer.

    And, no, I don’t consider ANY of the answers as enlightened (or, for that matter, unenlightened). I actually refuse such terminology, in favor of viewing answers (as well as questions) according to the different discursive structures of different economic theories—both official and unofficial, academic as well as nonacademic. What I’m objecting to more generally (as I’ve written and published elsewhere, with my coauthor Jack Amariglio) is the idea that there’s a singular, “enlightened” economic knowledge, and everything else is considered “ersatz” or “unenlightened” economic knowledge.

    As for carrying on the exchange in the EJW, let’s talk privately. . .

  4. Daniel Klein says:

    Thanks for your reply, David.

    Let’s say that someone said that we could solve poverty in the US by having the govt print up brand new $1,000 bills and handing 100 of such bills to each man, woman, and child in the country.

    What word would you use to describe such a view?

    Other _________ (fill in the blank)

    My point is that whatever reservations you have about the term enlightenment, you cannot escape judgment, and the main message of the study remains.

  5. David Ruccio says:

    To continue the conversation. . .

    Actually, Daniel, we can and often do suspend judgment (on this and other issues). There are lots of spaces of non-judgment or non-valuation. And, when we do suspend such judgments, we can ask other questions. Not is it wrong or right (according to some predetermined framework) but, rather, what are the conditions of possibility of such a statement being wrong or right?

    To be clear, though, it’s not that I’m against judging such statements (I do it all the time). My only point is that the terms of judgment are internal to one or another economic discourse (or theoretical framework or paradigm). I’m arguing against “rightness” or “enlightenment” in some absolute, trans-discursive sense. That was the point of my original critical comments.

  6. Daniel Klein says:

    “I’m arguing against “rightness” or “enlightenment” in some absolute, trans-discursive sense. That was the point of my original critical comments.”

    That point is non sequitur.

    You judge and you have a set of sensibilities.

    I judge and have a set.

    I’m willing to talk about certain things as enlightened. You aren’t, even though you act on their being so.

    That seems to be the only difference, and it isn’t important, at least to the matter at hand — namely, the left being very dangerous with governmental power, since, for example, they quite often don’t know (or won’t admit) that restrictions on housing development make housing less affordable.

  7. David Ruccio says:

    I’m not sure where the non sequitur is.

    But on to the more important issue you raise: if you want to make the partisan point that the Left does not agree with the usual neoclassical analysis of housing development (or any other topic), then make that argument. You don’t need the language of “enlightenment” to make the point that you consider left-wing ideas to be dangerous. And then people with a different economic theory can take the opportunity to criticize your analysis and present their own. It’s pretty simple, really, once we agree it’s a matter of partisanship and not enlightenment. . .

  8. […] flawed study by Daniel Klein and Zeljka Buturovic is back in the news—now that is has landed (with a new […]

  9. […] also to Klein for publishing Ruccio’s response after their polite discussion in the comments on Ruccio’s […]

  10. […] response to the original article, David Ruccio points out (shorter, longer) that these questions are theory-dependent. For example, it was unenlightened for people to […]

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