Who is an Econ­o­mist? (1)

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Who is an econ­o­mist? It is em­bar­rass­ing that there is re­ally no def­i­ni­tion of who an Econ­o­mist is or what he/she does. Yet many peo­ple go around call­ing them­selves by that pro­fes­sion. I went on­line, to the big­gest li­brary in the world - the in­ter­net - to find an an­swer. There was none. What I found in­stead were job ad­verts for ‘Econ­o­mists’ who wanted to join the rat race. They told me an Econ­o­mist is some­one with a Master’s De­gree and his salary av­er­aged blah blah ev­ery year. The few who at­tempted defin­ing who an econ­o­mist is, still used the word Eco­nomics in the def­i­ni­tion. Of what use is “an Econ­o­mist is some­one who stud­ied Eco­nomics”?!

But luck­ily I got some­thing from ar­guably the best econ­o­mist who ever lived; John May­nard Keynes. In the Eco­nomic Jour­nal 34 of 1924, pages 321-322, Keynes wrote an obit­u­ary for his tu­tor­men­tor, Al­fred Mar­shall who died that year. In the obit­u­ary, Keynes con­tem­plated the def­i­ni­tion of who, re­ally, is an econ­o­mist. This is what he said:

“The study of eco­nomics does not seem to re­quire any spe­cial­ized gifts of an un­usu­ally high or­der. Is it not, in­tel­lec­tu­ally re­garded, a very easy sub­ject com­pared with the higher branches of phi­los­o­phy or pure science? An easy sub­ject at which few ex­cel! The para­dox finds its ex­pla­na­tion, per­haps, in that the master-econ­o­mist must pos­sess a rare com­bi­na­tion of gifts. He must be math­e­ma­ti­cian, his­to­rian, states­man, philoso­pher-in some de­gree. He must un­der­stand sym­bols and speak in words. He must con­tem­plate the par­tic­u­lar in terms of the gen­eral and touch ab­stract and con­crete in the same flight of thought. He must study the present in the light of the past for the pur­poses of the fu­ture. No part of man’s na­ture or his in­sti­tu­tions must lie en­tirely out­side his re­gard. He must be pur­pose­ful and dis­in­ter­ested in a si­mul­ta­ne­ous mood; as aloof and in­cor­rupt­ible as an artist, yet some­times as near to earth as a politi­cian.”

Com­ing across this def­i­ni­tion greatly glad­dened my heart. I know that eco­nomics is re­garded as some generic pseudo-science; a dis­mal science it is called. But here was a man who un­der­stood what it was all about help­ing me put my first de­gree course of study and pride into per­spec­tive. I have met many phonies in my time who call them­selves Econ­o­mists but are one-track minded. An Econ­o­mist, a real one, can never think in black and white but in the 50 shades of grey in be­tween. We are trained to have open minds, to al­ways ques­tion. Our mod­els and for­mu­las, all of our Econo­met­rics, speak to that fact. A pure sci­en­tist would prove their equa­tions mat­ter-of-factly and add QED (quod erat de­mo­stra­tum - or ‘thus it has been demon­strated’) at the end of his equa­tion, but an econ­o­mist al­ways leaves room for doubt, with his ‘er­ror term’. No mat­ter your eco­nomic for­mula or model, a pro­vi­sion must be made for the ‘er­ror fac­tor’, rep­re­sented by small e or m. Why? Be­cause in the mat­ter of es­ti­mat­ing eco­nomic phe­nom­ena which in­volves hu­man be­ings, we know, and MUST ac­knowl­edge, that hu­man be­hav­iour could never be ac­cu­rately pre­dicted with­out any de­gree of de­vi­a­tion the next mo­ment.

So as much as I love the def­i­ni­tion of who is an econ­o­mist by May­nard Keynes above, and bask in the re­al­iza­tion that I’m on the right track, I have since come to that re­al­iza­tion that “An Econ­o­mist is some­one who never stops ask­ing ques­tions”. Any econ­o­mist who re­peats dogma, who mouths other peo­ple’s ideas, I have met many phonies in my time who call them­selves Econ­o­mists but are one-track minded. An Econ­o­mist, a real one, can never think in black and white but in the 50 shades of grey in be­tween. We are trained to have open minds, to al­ways ques­tion. Our mod­els and for­mu­las, all of our Econo­met­rics, speak to that fact. A pure sci­en­tist would prove their equa­tions mat­ter-of-factly and add QED (quod erat de­mo­stra­tum - or ‘thus it has been demon­strated’) at the end of his equa­tion, but an econ­o­mist al­ways leaves room for doubt, with his ‘er­ror term’. is a fraud. An econ­o­mist can never be dog­matic, hence many of us find it hard to be very re­li­gious. He main­tains an open mind. As it is, too many ‘pre­tend econ­o­mists’ have been run­ning the Nige­rian econ­omy. Their claim to fame is per­haps that they worked for some multi­na­tional donor agen­cies where they got into af­ter get­ting the right de­grees and of­ten by writ­ing the­sis that fit the agenda to run the world in a cer­tain way (dogma again). And we have been teach­ing our univer­sity stu­dents the wrong stuff. By now, Africans needed to have started think­ing for them­selves. We ought to have started cri­tiquing ev­ery­thing we were taught decades ago. The ev­i­dence is on ground that those the­o­ries never worked. A lot of the the­o­ries we pass on to up­com­ing stu­dents were ei­ther fun­da­men­tally or con­tex­tu­ally flawed, but es­pe­cially con­tex­tu­ally. Some­body should lead the change for their re­view from our pe­cu­liar con­texts.

The cen­tral­ity of this mat­ter can­not be overem­pha­sized. Per­haps the rea­son why Africa is un­able to rise is this in­tel­lec­tual cap­ture. It is sub­tle, but ef­fec­tive. We are fail­ing to launch be­cause we are read­ing the wrong tealeaves, and read­ing them wrongly, es­pe­cially in our eco­nomics. We are tak­ing the wrong medicine a medicine pre­scribed for other ail­ments - and hope to be cured. Al­ready, some of the fun­da­men­tal the­o­ries that we grew up with, have been dis­cred­ited. I re­cently read a long ar­ti­cle by Pro­fes­sor Paul Krug­man where he al­luded to Be­hav­ioral Eco­nomics and threw his weight be­hind those who now know that the idea of a ‘ra­tio­nal’ hu­man be­ing; the Homo Eco­nomi­cus, is all but non­sense. Yet, our eco­nomic de­ci­sion-mak­ers re­ally be­lieve in the ra­tio­nal man who can al­ways be mo­ti­vated with money! Pa­thetic! Be­hav­ioral Eco­nomics is one new strand of eco­nomics, and many quote the work of Richard Thaler, ‘Nudge’ where he ex­plored the fu­sion of psy­chol­ogy and eco­nomics. A de­part­ment was cre­ated by David Cameron in his Cab­i­net Of­fice which was called ‘The Nudge Unit’. The idea is that you MUST un­der­stand the psy­chol­ogy of your peo­ple be­fore en­act­ing eco­nomic poli­cies, and you can do things to ‘nudge’ them in a de­sired di­rec­tion. The UK did the right thing. Here, we still re­peat dogma. Of course Be­hav­ioral Eco­nomics is a di­rect chal­lenge to Adam Smith’s clas­si­cal the­sis.

I have writ­ten be­fore to am­plify those who have crit­i­cized even the ba­sis of Adam Smith’s teach­ing of eco­nomics. Ka­trin Mar­cal is an­other. She wrote a book ti­tled ‘Who Cooked Adam Smith’s Din­ner?’, posit­ing strongly that Mrs Smith - Adam’s mum - did not cook din­ner for her son be­cause she hoped to max­i­mize some util­ity, nei­ther did she wait to take ev­ery vari­able into con­sid­er­a­tion be­fore act­ing out of her love for her son. Mar­cal - a fem­i­nist - went ahead to say Adam Smith wrote as a man would (oops), but per­haps more im­por­tantly, that Adam was never mar­ried. If he mar­ried and had chil­dren, he may have for­mu­lated eco­nomics dif­fer­ently, with a lot more nu­ance. His Homo Eco­nomi­cus is a pitiable, lonely and un­friendly char­ac­ter, al­ways plot­ting for mon­e­tary ad­van­tage. Most hu­mans are not like that.

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