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Economic Orthodoxy and Emerging Pluralism

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Abstract

This chapter summarizes major steps in the emergence of twentieth-century economic orthodoxy and traces the recent emergence of a new methodological pluralism. To foresee where economics may be going, it is necessary to understand where it came from: particularly the social and technical contexts within which major changes occurred. The economics that emerged during the nineteenth and twentieth centuries was wholly unprepared for a world in which the economy engages in measurable coevolution with nature; yet recent developments indicate the field is adapting to this new world. The chapter concludes with a discussion of economics’ political influence and its implications for the economy of the future.

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Notes

  1. 1.

    Galbraith (1973, p. 11).

  2. 2.

    Dowd (2004, pp. 34–35).

  3. 3.

    Dowd (2004, p. 81).

  4. 4.

    McCloskey (1998).

  5. 5.

    Marglin (2008, p. 95).

  6. 6.

    Beinhocker (2006, pp. 27–29).

  7. 7.

    Beinhocker (2006, pp. 30–32).

  8. 8.

    Beinhocker (2006, p. 43).

  9. 9.

    Beinhocker (2006, pp. 34–35).

  10. 10.

    Galbraith (1973) and Dowd (2004).

  11. 11.

    Marshall (1920, p. 84).

  12. 12.

    Primarily a mathematician applying his techniques to economics, Cournot established an analytical basis for the rule of supply and demand. He also was a major influence on Léon Walras.

  13. 13.

    Marshall (1890). Preface to the First Edition of Principles of Economics. See Marshall (1920).

  14. 14.

    Marshall (1920, p. 139).

  15. 15.

    Marshall (1920, p. 163).

  16. 16.

    Marshall (1920, p. 139).

  17. 17.

    See, for instance, in the Preface to the Eighth Edition of Principles of Economics (Marshall 1920) and on p. 238.

  18. 18.

    Marshall (1920, p. 61).

  19. 19.

    Veblen (1919) quoted in Dowd (2004).

  20. 20.

    Veblen (1898, p. 373).

  21. 21.

    Veblen (1898, pp. 383–384).

  22. 22.

    Veblen (1898, p. 386).

  23. 23.

    Veblen (1898, p. 387).

  24. 24.

    Veblen (1898, pp. 389–390).

  25. 25.

    Veblen (1898, pp. 390–391).

  26. 26.

    Veblen (1898, pp. 394–395).

  27. 27.

    Veblen (1898, p. 396).

  28. 28.

    Veblen (1898, p. 397).

  29. 29.

    Dowd (2004, pp. 32, 240).

  30. 30.

    Marx (1867).

  31. 31.

    Galbraith (1973, p. 21).

  32. 32.

    Pigou (1920, 1932, p. 183).

  33. 33.

    Pigou (1920, 1932, pp. 183–185).

  34. 34.

    Pigou (1920, 1932, p. 224).

  35. 35.

    Pigou (1920, 1932, p. 184).

  36. 36.

    Galbraith (1973, p. 183).

  37. 37.

    Galbraith (1973, pp. 21–22).

  38. 38.

    E.g., Baumol (1982).

  39. 39.

    Dowd (2004).

  40. 40.

    Rousseas (1998, p. 15).

  41. 41.

    Marglin (2008, p. 113).

  42. 42.

    Schumpeter (1950, pp. 79, 83).

  43. 43.

    Schumpeter (1950, pp. 82–83).

  44. 44.

    E.g., Samuelson (1981) quoted in the Introduction to the 2008 reprinting of Schumpeter (1950) by Harper Perennial.

  45. 45.

    McCloskey (1998, p. 140).

  46. 46.

    Galbraith (1973, p. 27).

  47. 47.

    Coase (1937, p. 387).

  48. 48.

    They were shown, for example, to drive Time Warner’s decision to spin off its cable division in 2008 (Colander 2010, p. 278).

  49. 49.

    McCloskey (1998, p. 94).

  50. 50.

    Coase (1960, p. 44).

  51. 51.

    Coase (1960, p. 15).

  52. 52.

    Coase (1960, p. 17).

  53. 53.

    Galbraith (1973, p. 211).

  54. 54.

    Eichengreen (2008, p. 229).

  55. 55.

    Dowd (2004, pp. 185–186).

  56. 56.

    Mazower (2012, p. 346).

  57. 57.

    Stiglitz (2003, p. 284).

  58. 58.

    Stiglitz (2003, p. 275).

  59. 59.

    Perhaps markets have a socially optimal range of ‘viscosity’?

  60. 60.

    Stiglitz (2003, pp. 282, 292).

  61. 61.

    Beinhocker (2006, p. 166).

  62. 62.

    von Neumann and Morgenstern (1944).

  63. 63.

    Kahneman (2002) and Colander (2010, p. 511).

  64. 64.

    Hill and Myatt (2010, pp. 146–149).

  65. 65.

    Biologists have come to similar conclusions about animal behavior.

  66. 66.

    E.g., Beinhocker (2006, ch. 3).

  67. 67.

    Hsieh (1991, p. 1839). See also Berry et al. (1987) for a contemporaneous synthesis and James Gleick’s (1988) popular account.

  68. 68.

    See, for example, Falcon Crack and Ledoit (1996) on the ‘robust structure’ of financial time series that are nevertheless unpredictable.

  69. 69.

    Sornette (2003).

  70. 70.

    Akerlof and Shiller (2009) cited in Hill and Myatt (2010, pp. 147–149).

  71. 71.

    Lucas (1976).

  72. 72.

    For a recent example, see Sbordone et al. (2010).

  73. 73.

    Orrell and Chlupatý (2016, p. 153).

  74. 74.

    Woodford (2003) provides a survey.

  75. 75.

    Arthur (1994, p. 411).

  76. 76.

    Holland and Miller (1991)

  77. 77.

    Nelson and Winter (1982, p. 31).

  78. 78.

    Beinhocker (2006, pp. 136–138); see also Arthur (1995) and Arthur et al. (1997).

  79. 79.

    Buchanan (2009).

  80. 80.

    Recent reviews include Sandholm and Lesser (2001), Tesfatsion and Judd (2006), LeBaron and Tesfatsion (2008), Colander et al. (2008) and Westerhoff and Franke (2012).

  81. 81.

    Bowles et al. (2017, p. 218), their emphasis.

  82. 82.

    Bowles et al. (2017, pp. 215–216).

  83. 83.

    Friedman (1953, p. 22).

  84. 84.

    Nelson and Winter (1982, p. 47).

  85. 85.

    Nelson and Winter (1982, pp. 405–406).

  86. 86.

    Beinhocker (2006).

  87. 87.

    Colander (2010, pp. 132–133).

  88. 88.

    Norgaard, pers. comm.

  89. 89.

    Coase (1960, p. 43).

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    Fraser Murison Smith

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Murison Smith, F. (2019). Economic Orthodoxy and Emerging Pluralism. In: Economics of a Crowded Planet. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-030-31798-0_6

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