[A] young professor of political economy at Yale named Arthur Hadley sent a letter to his colleague Henry Carter Adams at the University of Michigan to express his reluctance to join the newly formed American Economic Association (AEA), on whose executive committee Adams sat.At the time, that might have been radical, but we have the Welfare Economics Paradigm laying out all the (restrictive, if you reflect on them) sufficient conditions under which Market Failure Warrants Government Intervention. There's also been a lot of research, since then, on all the ways that conceit goes wrong.
The AEA had been conceived as an upstart challenge to classical economic orthodoxy. Its founding platform stated, "We regard the state as an educational and ethical agency whose positive aid is an indispensable condition of human progress" — a polemical sentiment that worried Hadley.
That's missing from the review article.
The founders of the AEA, on the other hand, looked first to study economic outcomes as they found them. Treating wealth, work, wages, depressions, trade, and so on as contingent realities, as opposed to abstract truths, naturally led to the conclusion that they could be altered by policy. That implication clashed with the reigning mood against so-called class legislation, namely any attempt to alter the social hierarchy through collective action or public policy. At all levels, therefore, the AEA’s early approach defied the intellectual foundations of classical economics.Superficially, yes. But that which the leading edge scholars of the time thought they could do, later vanguards of scholars suggested might not be so easy. Complex adaptive systems and all that ...
It's much more fun to propose that economists succumb to the same virtue signalling and epistemic closure that's destroying so much else of the academy.
In contrast with other social sciences, which could be said to lean left, economists have a reputation for ideological diversity, if not conservatism, which is exactly how it comes to be that their research is lavishly funded in prestigious business schools and marquee departments. It’s hard to escape the conclusion that in exiling radicalism from the AEA and from mainstream economics, its practitioners attained enormous intellectual prestige and elite approval by sacrificing the disinterested search for answers to the most controversial questions in economics.I'm not sure it's so much that mainstream economists exiled "radicalism" (referring to of the left) for self-serving reasons as much as some combination of failures such as the labor theory of value to produce testable implications that stood up, or of the notion of a well-informed government official able to tax and regulate optimally, or of any attempt to be able to plan the outcomes of emergent and distributed network.
That they abandoned "advocacy" under the banner of "objectivity" only raises the question of what that distinction really means in practice. Perhaps actual objectivity does not require that the scholar noisily disclaim advocacy. It may, in fact, require the opposite.
Marginal Revolution's Alex Tabarrok reacts, albeit in a more colorful way, to the essay. Richard T. Ely, Alt-Right Founder of the American Economic Association. He's being outrageous to make a point, but it's a more general point about where Governance by Wise Experts can go. "To Ely property was a bundle of rights and no stick in that bundle was inherently more valuable than the others. If it’s ok to take a person’s property then it’s ok to take a person’s property full stop whether that be physical goods, the right to procreate, the right to associate, the right to speak and so forth." That's one of the tamer passages, and there's quite the bull session going on over there. Enjoy.