What we see through the scarcity lens

Abstract

Economics today faces intense criticism for its supposedly flawed foundations and empirical failings. A popular strategy used to rebut these criticisms is to more tightly circumscribe the explanatory aims of the subject. Economists are, on this view, only trying to describe a specific part of the social world, and only aim to elucidate factors relevant to that part. A statement of this kind of view can be found in Lionel Robbins’ hugely influential Essay on the Nature and Significance of Economic Science, where he defines economics as “the science which studies human behaviour as a relationship between ends and scarce means that have alternative uses”. My thesis presents a modern version of this view as a working hypothesis for the philosophy of economics. I then critique this working hypothesis. Neo-Robbinsianism claims that the optimisation methods of mainstream economics are epistemically indispensable for characterising important patterns in choice data. Don Ross – its most prominent defender – characterises this epistemic indispensability in terms of real patterns. Real patterns, a notion originally from Daniel Dennett, are patterns of information which are indispensable for prediction and explanation. I argue in favour of this characterisation of epistemic indispensability, but most of my arguments in this thesis rely only on the general notion of epistemic indispensability, rather than specifically real patterns. I argue neo-Robbinsianism is a defensible and implicitly popular account of what is distinctive and successful about modern economics – and hence a good working hypothesis for the philosophy of economics. I spend the rest of the thesis challenging this working hypothesis. Neo-Robbinsianism claims that constrained optimisation is epistemically indispensable in economics, but indispensability is a high epistemic bar. I argue that many mainstream cases in contemporary economics fail to reach this bar, with reference to an ongoing dispute in econometrics. I then consider how one might save neo-Robbinsianism from this critique, but argue that this reveals an inherent tension between the view’s epistemic success claim (indispensability) and its tight or even dogmatic circumscription of the discipline (economics as the science of scarcity). I leave the door open for weaker, potentially less dogmatic versions of neo-Robbinsianism, but discuss the challenges that one would inevitably face in articulating such a view that avoids the pitfalls but retains the attractive features of neo-Robbinsianism.