February 22, 2016

Krugman and the scientific implosion of economics

Comment on ‘Krugman versus Sanders’


Krugman is accused for supporting ‘political figures he likes, notably Hillary Clinton’ and attacking Bernie Sanders. What could possibly be wrong with that? Nothing, of course, except that Krugman is an economist. What is indeed wrong, is that economics is a science and as a scientist Krugman has no political mandate at all. Most people do not get the point because they have come to believe that science is just another sitcom format. And that is not wrong as far as economics is concerned.

Long before the hijacking of economics by morons, J. S. Mill, the great economist and methodologist, was well aware that there is a categorical difference between politics and science: “A scientific observer or reasoner, merely as such, is not an adviser for practice. His part is only to show that certain consequences follow from certain causes, and that to obtain certain ends, certain means are the most effectual. Whether the ends themselves are such as ought to be pursued, and if so, in what cases and to how great a length, it is no part of his business as a cultivator of science ....” (Mill, 2006, p. 950)

In no uncertain terms Mill told his fellow economists: politics and science have to be separated and there is no revolving door between the two. The first thing to notice is that this message was obviously wasted on Krugman.

To speak of economics tout court is always misleading because there is political and theoretical economics and there is storytelling and something like the true theory. The crucial distinction is this:
(i) The goal of political economics is to push an agenda, the goal of theoretical economics is to explain how the actual economy works.
(ii) In political economics anything goes; in theoretical economics scientific standards are observed. The standards are well-defined as material and formal consistency.

Theoretical economics has to be judged according to the criteria true/false and nothing else. The criteria of political economics are good/bad or like/dislike. Political economics has produced nothing of scientific value since Adam Smith.

Accordingly, Krugman has to be criticized for having made the wrong choice between political economics (= agenda pushing and storytelling) and theoretical economics (= science) and for trespassing the line between the two. He has to be criticized for being an incompetent scientist (2014) and thrown out of the scientific community.

Being out of science, Krugman can no longer be criticized for preferring one politician above the other or talking economic nonsense. After all, he then is among equals at the lowest possible intellectual level.

There is neither a political nor a moral justification for an economist to give economic policy advice without sound scientific foundation. Economists owe society the true theory, not less, not more. Krugman lacks the true theory, and with him all who subscribe to sorta-kinda maximization-and-equilibrium.

For Krugman in particular and the political sects of Walrasians, Keynesians, Marxians, Austrians and other scientific failures in general there is only one honorable option left in this election campaign: to shut up.

Egmont Kakarot-Handtke

Kakarot-Handtke, E. (2014). Mr. Keynes, Prof. Krugman, IS-LM, and the End of Economics as We Know It. SSRN Working Paper Series, 2392856: 1–19. URL
Mill, J. S. (2006). A System of Logic Ratiocinative and Inductive. Being a Connected View of the Principles of Evidence and the Methods of Scientific Investigation, volume 8 of Collected Works of John Stuart Mill. Indianapolis, IN: Liberty Fund.

Related 'Krugman is not an economist' and 'Scientists and science actors' and 'A science without scientists'