You are on page 1of 15
Why Economics Is Not Yet a Science Author(s): Alfred S. Eichner Source: Journal of Economic Issues,07/2013 20:07 Your use of the JSTOR archive indicates your acceptance of the Terms & Conditions of Use, available at . . JSTOR is a not-for-profit service that helps scholars, re searchers, and students discover, use, and build upon a wide range of content in a trusted digital archive. We use information technology and tools to increase productivity and facilitate new forms of scholarship. For more information about JSTOR, please contact . Association for Evolutionary Economics is collaborating with JSTOR to digitize, preserve and extend access to Journal of Economic Issues. " id="pdf-obj-0-2" src="pdf-obj-0-2.jpg">

Why Economics Is Not Yet a Science Author(s): Alfred S. Eichner Source: Journal of Economic Issues, Vol. 17, No. 2 (Jun., 1983), pp. 507-520 Published by: Association for Evolutionary Economics

Stable URL: .

Accessed: 22/07/2013 20:07

Your use of the JSTOR archive indicates your acceptance of the Terms & Conditions of Use, available at .


JSTOR is a not-for-profit service that helps scholars, researchers, and students discover, use, and build upon a wide range of content in a trusted digital archive. We use information technology and tools to increase productivity and facilitate new forms of scholarship. For more information about JSTOR, please contact


Association for Evolutionary Economics is collaborating with JSTOR to digitize, preserve and extend access to
Journal of Economic Issues.




No. 2

June 1983

Why Economics Is Not Yet a Science

Alfred S. Eichner

In 1898, the Quarterly Journal of Economics published an essay by

ThorsteinVeblen entitled,"Why Is EconomicsNot an EvolutionarySci- ence?"While one mightnot agree with the answerVeblen gave, he must at least be creditedwith having asked the right question. Today, more than eightyyears later,the questionis even more to the point. The same neoclassicaltheory to whichVeblen took such exceptionre- mains dominant. The theory has been supplementedby a Keynesian macroeconomics(quite differentfrom MaynardKeynes's own ideas), and the resulting"neoclassical synthesis" has been considerablyrefined by its translationinto mathematicsby John Hicks and Paul Samuelson,

but Veblen would have little difficultyrecognizing its core. It is pretty muchthe same theorythat ruled in his day-though, of course, with the rougheredges smoothedover. It is this theorythat now, eightyyears later, has become intellectually bankrupt.Economic theory can offer no solutionto the problemof infla-


to stifle the very growth of output and employmentthat

shouldbe the firstconcern of economists.In this way the problemof in- flation, annoyingas it may be, has been transformedinto the far more

seriousproblem of worldstagflation. Politicians and the publicalike, im- patientwith policy recommendationsthat bringno relief from the malady

The author is Professor of Economics, Rutgers University, and Director, Center for Economic and AnthropogenicResearch. This article was presentedat the Annual Meeting of the Association for Evolutionary Economics, New York City, 28-30 December 1982.


  • 508 AlfredS. Eichner

but instead seem only to make the problemworse, have begun to shun the companyof economistsmuch as any man who cares about his intel- lectualreputation shuns the companyof astrologers,elixir-promoters, and otherquacks. Why,indeed, is economicsnot yet a science-in the sense of represent- ing a body of knowledgethat growscumulatively over time and has some- thing of value to teach men and women of practicalaffairs? The answer can be found, at least in part, by comparingthe epistemologyof eco- nomicswith that of a true science.'

The Epistemological Rules of Science

It is a common errorto think of science as being characterizedby a particularmethodology, or prescribedway of acquiringknowledge. How- ever, a moment'sreflection on the diversemethodologies pursued by sci- entists, ranging from the highly abstract mathematicalmodels of the theoreticalphysicists to the carefullycontrolled laboratory experiments of the biologistsand the painstakingfield work of the geologists,should sufficeto disabuseanyone of that notion. Insteadwhat uniquelycharac- terizesa scientificapproach is a certainepistemology, or way of validating ideas.The modernworld is qualitativelydifferent from all previouscivili- zationsnot becausea certaingroup of savantsidentified as scientistshas discovereda new way of addingto knowledge(though it has, indeed,de- veloped an impressivearray of new instrumentsfor accumulatingdata),

but ratherbecause the membersof that

confraternityhave evolved a set

of rulesfor discoveringwhat is false and therebyavoiding non-productive lines of research.The set of rules for eschewingwhat is false is the epis- temologyof science,and it involvesapplying a seriesof tests to what any- one may assertto be true.

One of these tests is the test of coherence.This test consists of deter- miningwhether the conclusionsadduced follow logically from the assump- tions made and thus whetherthe argumentsare internallyconsistent. At one time, followingDescartes, it was believedthat this test was sufficient to establishthe validityof any proposition.Economists, especially those esteemedas theoristsby theircolleagues, by and largestill believethis test to be sufficient.That is why they tendto favorthe exclusiveuse of mathe- matics,a languageespecially suited to logical analysis,along with mathe- matical"proofs." However, in the wake of David Hume'sarguments as a skeptic on behalf of empiricism,scientists and philosophers(they were not thendifferentiated) come to recognizethat the coherencetest was only necessary,not sufficient.In addition,a seriesof furthertests, empiricalin

Not Yet A Science


nature,was requiredto validateany proposition.These empiricaltests are three-fold.

Thereis, first, the correspondencetest. This test consists of determin-

ing whetherthe conclusionsfollowing from a theory

are confirmedby

whatcan be observedempirically of the realworld. The greaterthe ability of a theoryto anticipatewhat can be observedempirically, the greaterthe basis for believingthat the theory actuallycorresponds in some way to what happensin the real world. Thenthere is the comprehensivenesstest. This test consistsof determin- ing whetherthe theoryis able to encompassall the known facts pertain-

ing to the class of phenomenaunder study. The more of these facts the theoryis able to accountfor, the greaterthe confidenceone can have that the theory is comprehensive.A theory may fail to meet the comprehen-

sivenesstest for either of two reasons: (1 ) because the

theory provides

no explanationfor certainempirically observable phenomena, or (2) be- cause whatis empiricallyobserved is, undercertain circumstances, differ- ent from what the theory would lead one to expect. A theory unable to meet the comprehensivenesstest, for eitherof these reasons,is less likely to be rejectedoutright than to be relegatedto the categoryof a special case-with the importanceof that special case dependingon how com- monly encounteredare the conditions,or assumptions,under which the

theoryholds. In that event, the comprehensivenesstest consists of deter- miningunder what circumstances the theoryremains valid. Finally, there is the parsimonytest. This test consists of determining whetherany particularelement in the constructionof a theory,including one of its underlyingassumptions, is necessaryto accountfor what can be observedempirically. To the extentthat the elementcan be eliminated withoutreducing the theory'sexplanatory power, it should be dropped as being superfluous.In this way a theory is purgedof its metaphysical elements,and subsequentinvestigators are not misledinto pursuingnon- productivelines of research.

All three of these tests are empirical.This can be seen more clearlyby viewinga theoryas a systemof interrelatedideas. The inputsinto the sys- tem are the assumptions,or conditions,under which the ideas become operative, and the output consists of the conclusions, or observable effects,derived from the theory.The internalstructure, meanwhile, is the series of steps by which the conclusionsare obtainedfrom the assump- tions. The correspondencetest, then, consists of checking the theory's output,or conclusions,against the observablereality to determineif they are isomorphic;the comprehensivenesstest consists of checkingto see

whetherthere is not

some part of the observablereality left unexplained

  • 510 Alfred S. Eichner

by the theory, requiring additional inputs, or assumptions, that make the theory a special rather than a general one; and the parsimony tests con- sists of checking whether there is not some element of the theory, often based on an input, or assumption, that can be dispensed with entirely in explaining the observable reality. It is only by meeting all three of these tests that a theory can be said to have been validated empirically. Social scientists, in arguing that their theories should be accepted with- out necessarily having to meet all these tests, point out how difficult it is for them to carry out empirical research. Many economists would be among their number, noting that their subject matter does not lend itself to laboratory experiments in which other things can be held constant, and that a reliance on statistical analysis, the only feasible alternative, seldom leads to conclusive results. These points, unfortunately all too true, are nonetheless not a reason for relaxing the insistence on empirical valida- tion of theory. If anything, they are a reason to insist on an even more stringent test in the case of any social science theory. The theory must be shown to make a difference to society, when translated into one or more public policies, that will lead to certain clearly distinguishable results. The policies must then be adopted and the predicted effect confirmed. This is the praxis test of a social science theory. While it might be argued that this is much too rigorous a test to insist that any theory meet, especially in the social sciences, the present sorry state of economics is evidence of what is likely to be the consequence when, despite its not having been validated empirically in this or in any other way, a body of theory continues to re- main at the core of a discipline.

The Empirical Validity of the Neoclassical Core

The neoclassical core of economic theory is little different from what it was in Veblen's day. That core consists of four basic elements, or theo- retical constructs: (1) a set of indifference curves for each and every individual that when aggregated for all households represent the relative preferences for any two or more goods by the society as a whole; (2) a set of continuous, or smooth, isoquants for each and every good produced that when taken together represent all the combinations of labor and other inputs that can be used to produce those goods; (3) a set of positively sloped supply curves for all the different firms and industries comprising the enterprise sector, and (4) a set of marginal physical product curves for all of the inputs used in the production process, not just the labor in- puts but also, even more critically, the "capital" inputs. One or more of these four elements is usually the basis for any microeconomic argument

Not Yet A Science


madeby economists,and any argumentthat relieson at least one of these four theoreticalconstructs can be regardedas "neoclassical." What is most startlingabout these four theoreticalconstructs is that


their vintage,they have yet to be empiricallyvalidated by econ-

omists. The strongsuspicion surrounds them that ratherthan servingas the basis for furtherwork in economics,they each representa source of

fundamentalerror that needs to be correctedbefore any scientificprogress

will be

possiblewithin the discipline.


indifferencecurves that form the

consumerdemand are suspectbecause it

basis of the orthodoxtheory of has provenimpossible to derive

a set of these curves from the available empiricaldata [Mishan 1961; Blaug 1980, chap. 6]. The theoreticalconstruct of indifferencecurves is thereforemetaphysical in the same sense that unicorns,ghosts, and the

"vital force" once thought to animatehuman beings are metaphysical:

thereis no empiricalevidence that such thingsactually exist. The isoquants underpinningthe orthodox theory of productionare

equallysuspect and for the same reason: It

has proven impossibleto de-

rive these curves from the available data on productionby individual firms.The conceptof an isoquantis no less metaphysicalthan that of in- differencecurves. Indeed, the case againstisoquants is even stronger.The implicationof isoquants-namely, that firmsare able to producea given quantityof output,even in the absenceof technicalprogress, by employ- ing varyingcombinations of labor and other inputs-is stronglycontra- dicted by the availableevidence. Empirical investigation in a numberof manufacturingindustries has shown that productionrequires the use of labor, material,and other inputs in relativelyfixed combinations-until such time as a new plant is built and/or new equipmentis installed,at which point a new fixed combinationof inputswill be employed. The purgingof indifferencecurves and isoquantsfrom the theoretical "tool kit" of economicson the groundsthat they are metaphysicalis fatal to any neo-Walrasian(actually Hicks-Arrow-Debreu)general equilib- rium model. While this world still leave the Marshallianpartial equilib- riumtheory unscathed,this variantof neoclassicaltheory, too, becomes suspectonce we realizethat thereis no empiricalsupport, at least outside agricultureand mining,for the positivelysloped supply curve that is an essentialhalf of Marshall'sfamous scissors. The positivelysloped supply curve is based on two assumptions:(1) that firmsare price takersseek- ing to maximizetheir net revenuein the short run, and (2) that produc- tion is subjectto variableand, indeed,beyond a certainpoint, to decreas- ing returnsto scale. The availableevidence would seem to contradictboth assumptions,at least insofaras the industrialsector is concerned[Blaug

  • 512 Alfred S. Eichner

1980, chap. 7; Eichner 1976, chap. 2]. Firms in that sector are generally price setters rather than price takers and long-term survival and expan-

sion rather than short-run profit maximization would appear to be their goal. Moreover, constant and even increasing returns to scale rather than decreasing returns appear to be the rule. At least there is no evidence that industrial firms encounter higher unit costs as they expand output [John- ston 1960; Walters 1963]. The marginal productivity analysis, the basis for the neoclassical theory of income distribution, is immediately suspect because of the fixed tech- nical coefficients that the evidence indicates characterize the production process in at least the technologically most advanced sectors. With fixed technical coefficients, inputs cannot be varied in the manner required to make the marginal productivity theory applicable. The theory invites

further skepticism because

"capital," the marginal productivity of which

is central to the argument, turns out to be another metaphysical concept like indifference curves and isoquants. No one would deny the importance of produced goods used as inputs in the production process. The problem is that these capital inputs are heterogeneous, with no common physical basis. This means they cannot be aggregated, as required by the inclusion of the "capital stock," K, in the production function underlying the theory of income distribution [Blaug 1980, chap. 9; Harcourt 1972]. Conse- quently the theory itself cannot be empirically validated. Indeed, the theory is largely vacuous. The four theoretical constructs discussed so far and found to lack em- pirical validity are important only insofar as the orthodox microeconomics is concerned. This would seem to leave the orthodox macroeconomic theory intact. However, the macro theory is based on the same micro foundation and it is, to that extent, open to the same criticisms. Moreover, the orthodox macro theory is predicated on two additional theoretical constructs no less empirically suspect: the Hicks-Hansen LM-IS frame- work and the Phillips curve. Neither construct is able fully to meet the correspondence test, let alone the praxis test.2 It will, of course, be argued that if all six of the theoretical constructs just examined were to be purged from the economics textbooks, very little would remain and what was left would lack coherence. This, however, is not a sufficient reason to retain the six constructs-especially when there is a readily available alternative.

The Alternative Paradigm

A comprehensive, and robust, alternative to the orthodox neoclassical

Not Yet A Science


theoryhas emergedin

recentdecades. This new paradigmhas beentermed

post-Keynesian,both to indicateits intellectualroots and to suggestthe

need to go beyondKeynes's own analysis.(It could just as well be termed post-classical, post-Marxi!an,post-Marshallian, behavioralist, or even neo-institutionalist.)To the principleof effectivedemand and the role

ascribedto money in The General Theoryhave been

added the growth

dynamicsof Roy Harrodand John von of WassilyLeontief, the value theoryof

Neumann,the productiontheory Piero Sraffa,and the distribution

and pricingmodels of MichalKalecki [Eichner and Kregel1975; Eichner


It was Joan Robinson who, in The Accumulation of Capital

[1956], firstsucceeded in synthesizingmany of these ideas withina single coherentmodel, and it was Luigi Pasinettiwho more recently,in Struc-

tural Change and Economic Growth [1981], has succeeded in producing

an even broadersynthesis. To each of the elementsof the neoclassicalsynthesis previously identi- fied as being withoutempirical validity, post-Keynesian theory offers an alternativeformulation, one yet to be discreditedon empiricalgrounds andindeed, in severalcases, alreadywith a considerablebody of empirical

evidencebehind it. In place of the metaphysicalindifference curves under .. lying the neoclassicaltheory of demand, post-Keynesiantheory starts withthe priceand incomeelasticities that economistsare actuallyable to estimate.Based on a substantialbody of researchgoing back to Frederick Engels'swork in the nineteenthcentury, post-Keynesian economists gen-.

erallyassume that in

an economyexpanding over time (albeit unevenly),

it is the incomeeffects that predominateover the relativeprice, or substi- tution, effects. The lack of substitutionpossibilities reflects the impor- tance of social convention,and thus of acquiredtastes, in determining each household'snormal consumption pattern. In a line of reasoningthat can be tracedback to Veblen [1899], Wesley C. Mitchell [1937], James S. Duesenberry[1949], and other institutionalists,consumer preferences are viewedas beingthe resultof learnedsocial behaviorrather than innate at birthor in some other sense exogenousto the analysis.These prefer. ences are likelyto be modifiedover time, not just by advertisingand other sellingtechniques but also, even more significantly,by the growthof in- come levels withineach of the social groups,or classes,that comprisethe society, as an increasinglyaffluent life style comes to be viewed as the norm. Consumerpreferences are, in this sense, lexicographicallyordered


However,it is on the supply side that post-Keynesiantheory departs even more radicallyfrom the orthodoxmodels. As opposed to the iso- quants,which are the startingpoint for the analysisof production,such

  • 514 AlfredS. Eichner

as can be found in neoclassicalmodels, post-Keynesiantheory begins by positingthe priorexistence of an A matrix,or set of labor and othertech- nical coefficients,as a reflectionof the prevailingtechnology. It is the in- verse of the A matrix,the so-calledLeontief inverse,that plays the key role in the long-termanalysis of both outputand prices.Using the inverse, it is possibleto determinethe differentialeffect on each of the economy's manyindustries of a changein the compositionof finaldemand, and thus

the differentialeffect produced by the

unevengrowth of those industries.

The same inversecan also be used, as part of the dual solution,to deter- minethe set of relativeprices that must prevail in the long termif each in- dustryis to earn sufficientrevenues to cover the cost of all requiredin-

puts, including any additionsto the capital stock when the system is

expanding. This theory of the relativeprices that must prevailin the long term if the systemis to reproduceitself becomesa theoryof absoluteprice levels,

in both the long term and the

short, once a numerairein the form of the

wage rate is introduced.The wage rate, ratherthan being just another price as in the Walrasiangeneral equilibrium model, determinesall the other value relationshipswithin the system. Here post-Keynesiantheory is careful to distinguishbetween the real wage-which consists of the actual basket of consumptiongoods workerscan purchasewith the in- come they earn-and the moneywage. The latteris simplya nominalrate of compensationand, as opposed to the real wage, dependson the bar- gainingstrength of workersand otherfactors extrinsic to the dynamicsof

the economic system [Piore 1979]. Indeed, this distinctionbetween the real and the money wage underliesthe post-Keynesiantheory of inflation, it being the growthof money wages in excess of the real wage as deter- minedby the growthof outputper workerthat necessarilyleads to an off- settingrise in the price level [Weintraub1959; 1966]. The post-Keynesiantheory of productionand pricessuggests a specific alternativeto the positivelysloped industrysupply curve that forms the basis for orthodoxexplanation for inflation.Firms in the industrialsector are assumedto be price setters ratherthan price takers, and the prices they set are the pricesdictated by their costs of productionplus a certain margin,or markup. The markup, insteadof risingand falling with the level of demand,tends to remainfixed over the cycle, with the size of the markup dependenton both the amountof externaldebt that mustbe ser- viced as a resultof past capitalaccumulation and the amountof internally generatedfunds required to financethe firms'planned future capital out- lays. Whatthis line of argumentimplies is that to the extent an industry

supplycurve can even be said to exist

[Wiles 1956; R. Robinson 1961],

Not Yet A Science


it is, withinthe observablerange, perfectlyelastic ratherthan positively sloped. Within a post-Keynesianmodel, a set of macroeconomicconditions primarilyexplains the distributionof income.This is in sharpcontrast to the neoclassicaltheory, in which the explanationdepends on a set of microeconomicrelationships-in particular,on the abilityof firmsto sub- stituteone type of inputfor anotherat the margin.The most importantof the macroeconomicfactors explainingthe distributionof income is the growth of output per worker, itself largely the result of the technical progressmade possibleby the applicationof science and other forms of knowledgeto the problemof wrestinga materialexistence from a par- simoniousnatural endowment. The other determinantsof the incomedis- tributionare the rate of accumulationand the propensityto consumeout of non-wageincome (for example,profits). Otherthings being equal, an

increasein the

rate of accumulation(investment) and/or the propensity

to consumeby non-wagerecipients will lead to a decline in labor'sshare of nationalincome. Whileit mightseem that the amountof consumptionout of non-wage income, such as profits,is limited to any dividendspaid out and other

forms of rentierincome not reinvested,it actuallyencompasses a much

broaderset of incomeflows. The government,through the taxes it collects

from business,receives a share of all pliers of raw materials,through any

profits.Moreover, the foreignsup- increasein the prices they charge,

can also siphonoff a shareof the profitsbeing earneddomestically. Thus

the shareof nationalincome going to workerswill be reduced,not just by a higherrate of investmentbut also by an increasein the size of the public sectorand by risingraw materialprices. Indeed, these severalfactors, to- getherwith a wage patternthat, in a vain effortto offsetthe rise in prices, exceedsthe growthof outputper worker,can be used to explainthe secu- lar inflationof the last two decades. Post-Keynesiantheory thus not only providesa specificalternative to each of the four elementsthat constitutethe microeconomiccore of neo- classicaltheory. It also offersa plausibleexplanation for the secularinfla- tion that has bedeviledthe world'sadvanced market economies since the

end of World War II-an

explanationthat suggeststhe need for some

form of incomespolicy if countriesare to avoid the stagflationthat results

when monetary and fiscal policy are instead used to control inflation [Eichner1980]. One could elaboratein much greaterdetail, both on the points already covered and on the other elements of post-Keynesian

theory. Still, enoughhas been said to demonstratethat if


reluctantto abandon the neoclassicaltheory in spite of its well-known

  • 516 AlfredS. Eichner

shortcomings,this is not becausethere is nothingbetter to take its place. The explanationmust lie elsewhere.Indeed, it lies in the natureof eco- nomicsas a social system.

Economics as a Social System

Economicscan be viewed as a social systemin which a

small number

of economists,because of the position they occupy at the half dozen or

leadinguniversities, exercise a disproportionateinfluence through the controlthey have over appointments,research funds, and access to jour-


nals. Still, this is consideredto be

not what distinguisheseconomics from the disciplines sciences. It is ratherthat this pyramidalstructure and

the power exercisedthrough it is used to supportand reinforcean ethos

opposedto science. In other words, the cultureof economicsas

a social

systemis a non-scientificone. In part,this is simplya reflectionof

the eco-

nomics profession'sintellectual heritage, its rootingin the anti-empiricist traditionof the classicaleconomists. But it is also the result of more re-

cent developmentsin economics-in particular,the neoclassicalcounter- revolutionthat Keynesprovoked. No soonerhad the Keynesianheresy surfaced than it led to a response thatwould effectively contain the threatto the establishedway of thinking in economicsposed by The GeneralTheory. First Hicks and then, even more definitively,Samuelson laid the foundationsof a new "neoclassical synthesis,"which, like the Thomasticsynthesis six centuriesearlier, could serve to reconcilefaith with reason. One key aspect of this neoclassical synthesishas already been touched on. This was the reformulationof

Keynes'sideas in sucha way that,taking the formof

the now conventional

LM-IS framework,it could serve as the macroeconomiccounterpart to the older microeconomictheory, now transformedalong neo-Walrasian lines. An even more significantaspect of the neoclassicalsynthesis, how- ever, was its translationof all of economictheory, macro as well as micro, into a more precisemathematical language. The reasonsfor this developmentare not entirelyclear. It could have

been that the ascendencyof those trainedin mathematics,at the expense of those trainedin more historicalmethods, simply reinforcedthe long- standingpenchant of economistsfor purelydeductive modes of analysis-

what Peter J. Wiles Ricardianvice. Or it

[1979-80], following

Schumpeter,has termed the

could have been that, meetingwith so little success

in validatingempirically the key elementsof the neoclassicalsynthesis, the theoristssimply retreated into mathematicalformalism. Whatever the reason,the effecton economicsas a disciplinehas been disastrous. Thereis firstthe continuedadherence to a non-scientificepistemology

Not Yet A Science


encouragedby the mathematicizationof economics. Economists as a group have adopted the view that formal, or mathematical,proofs are sufficientto establishthe validityof a theoryrather than just being neces- sary.The insistencethat formalproofs are sufficienthas led to two further violationsof scientificnorms. One is the sharpdistinction drawn in eco- nomics between "theorists,"those who employ formal (mathematical) methods,and "applied"economists, those whose work is based on sta-

tistics and other means of analyzingdata. Thus

it is common for the

"theorists"to set up their models in such a way that the postulatedbe- haviorruns counterto all that is known about actual economic systems withoutthis fact impugningeither the argumentor the economists'repu- tation. So sharp a distinctionbetween theory and empiricalresearch is

unknownin the naturaland biologicalsciences, and for good reason. It leads to an outpouringof uselesstheories that waste the time and energy of empiricalresearchers. The other violation of scientificnorms comes withthe argumentthat the purposeof theory,at least in economics,is not


explainwhat actuallyhappens under observable conditions but rather


determine,logically, the conditionsthat must be satisfiedif a certain

goal, to wit, the optimalallocation of resources,is to be satisfied.In this way, the purposeof scienceis turnedon its head.

The objectionhere is not to the use of mathematics-or even to the

mathematicizationof economics.It

is ratherto the misusethat has been

made of mathematicsin economics-and in particularto the way it has been used to give a pseudo-scientificfagade to a body of theorythat can

meet none of the empiricaltests by whicha science is distinguishedfrom mere superstitionor crudeideology. Why economistsshould cling so tenaciouslyto the neoclassicalcore, even being willingto sufferit in mathematicaltranslation, can easily be understood.For one thing,the neoclassicalcore is the essentialglue hold- ing the economicsprofession together. It requiresthe use of a particular type of languageand, no less important,a particulartype of metaphor (the "market").Without that languageand withoutthat metaphor,econ- omists would have difficultycommunicating with one another,and thus carryingout the everydaybusiness of economics,given the enormousdi- versity of interestsand viewpointsamong them. No less important,the

neoclassicalcore (especially in mathematicaltranslation) serves

as an

effectivemeans of raisingthe economicsprofession above the level

of the

untutoredmasses-and at the same time insuringthat only those who have come to acceptthe limitationsof economicsat the presenttime, in- cluding its non-scientificepistemology and its empiricallyunvalidated constructs,will be certifiedas competentin the subject.Thus it enables the social system representedby the economicsprofession to reproduce

  • 518 AlfredS. Eichner

itself withoutfundamental change. This role played by the neoclassical

core of economictheory can be a programof instructionthat,

seen in the trainingeconomists receive- as it proceeds, makes the individualin-

creasinglyless able to understandreal economicphenomena. At everystage in the developmentof an economist,beginning with the firstintroductory course, the neoclassicaltheory serves as a screeningde- vice to filterout the disbelieving.Usually just an exposureto the subject

is sufficientto divert into other fields those hoping to understandeco-

nomic and other social processes.The

unrealisticnature of the assump-

tions, proudlyproclaimed, are a clear warningthat those seekingknowl- edge shouldsteer clear of the field. But some studentswill have teachers

who nonethelesssucceed in makingthe subjectappear relevant-they are mostlikely to be membersof the facultyknown for theirunorthodox view- point-while other studentswill be so stronglymotivated, despite what

they are exposedto, that they will perseverein their study of


hopingthat more advancedcourses-or at least coursesat a

more pres-

tigious university-will finallyshed some light on the problemsthat at- tractedthem to economicsin the firstplace. All the same, long before an individualhas completeddoctoral training, he or she is likely to be faced with a hardchoice. To win the praise,and support,of his or her teachers, he or she will need to embracetheir perspective. In almostevery case, this means adopting a neoclassical frameworkfor analyzing problems in


The advantageto the economics professionin using the neoclassical core as a screeningdevice is clear enough. It enables the professionto meethead on and defeatthe most potentchallenge to any orthodoxy-the

greaterskepticism of the youngerminds drawn to the studyof the subject. If in this way economicsbecomes a closed system of ideas, so much the

better for

preservingthe position of those at the top of the profession

while still retainingthe appearanceof their being scientists.The disad- vantage,however, is also considerable.The retentionof the neoclassical

core and the continuedinsistence on its masteryas the


being consideredcompetent in the field means that aside from driving

away many of the brighteryoung minds, economics can

never hope to

becomea science. Economicsas a disciplinetherefore has a choice: It can retainthe neo- classical core of its theory or, alternatively,it can one day become a


It cannothave it both ways.

Not Yet A Science



  • 1. This is a condensed version of the title essay that appears in Eichner



For a more extended discussionof this point, see the originalversion of

this essay in

Eichner [1983].


Blaug, Mark. 1980.

The Methodology

of Economics,

Or How Economists

Think.Cambridge: Cambridge University Press. Canterbery,Ray. 1979. "Inflation,Necessities and DistributiveEfficiency." In

Essays in Post-Keynesian

Inflation, edited by J. H.

Rockwood, Jr. New York: Ballinger.

Gapinsky and C. E.

Duesenberry, James S. 1949. Income, Saving, and the Theory of Consumer

Behavior. Cambridge,Mass.: HarvardUniversity Press.

Eichner, Alfred S. 1976. The Megacorp and Oligopoly: Micro Foundations

of Macro Dynamics. Cambridge:Cambridge University Press.

, ed. 1979. A Guide to Post-Keynesian Economics.

York: M. E. Sharpe.

Armonk, New

. 1980. "A Post-Keynesian

Interpretation of Stagflation: Changing

Theory to Fit the Reality." In Stagflation: The Causes, Effects and Solu-

tions, publishedby U.S. Congress,Joint EconomicCommittee, Special Study on Economic Change.

, ed. 1983. Why Economics Is Not Yet a Science. Armonk, N.Y.:

M. E. Sharpe. Eichner, Alfred S., and J. A. Kregel. 1975. "An Essay on Post-Keynesian


Theory: A New Paradigm in Economics." Journal of Post Keynesian Eco-


nomics 13 (December): 1293-1314.


Harcourt, Geoffrey C. 1972. Some Cambridge Controversies in the Theory of


Capital.London: CambridgeUniversity Press. Hicks, John. 1939. Valueand Capital.Oxford: OxfordUniversity Press.


Johnston,John. 1960. StatisticalCost Analysis.New York: McGraw-Hill.


Keynes, John Maynard. 1936. The General Theory of Employment, Interest

and Money. London: Macmillan. Mishan, Edward J. 1961. "Theories of Consumers'Behaviour: A



View."Economica N.S. 28 (February): 1-11.


Mitchell, Wesley C. 1937. The Backward Art of Spending Money and Other


Essays.New York: McGraw-Hill.


Pasinetti, Luigi L. 1981. Structural Change and Economic Growth, A Theo- retical Essay on the Dynamics of the Wealth of Nations. Cambridge: Cam-


bridgeUniversity Press.


Piore, Michael J., ed. 1979. Unemployment and Inflation, Institutionalist and Structuralist Views. Armonk, N.Y.: M. E. Sharpe. Robinson, Joan. 1956. The Accumulation of Capital. London: Macmillan.

Robinson, Romney. 1961. "The Economics of DisequilibriumPrice." Quar-

terly Journal of Economics 75 (May): 199-233.

  • 520 Alfred S. Eichner

Samuelson, Paul. 1948. Foundations of Economic Analysis. Cambridge,

Mass.: HarvardUniversity Press.

Veblen, Thorstein. 1898. "Why Is Economics Not an EvolutionaryScience?"


Quarterly Journal of Economics

12 (July):


reprinted in Veblen,


The Place of Science in Modern Civilisation. New York: Huebsch (1919).




The Theory of the Leisure Class. New




braryedition (1961).

Walters, Alan A. 1963. "Production and Cost, An Econometric Survey."


Econometrica 31 (January): 1-66.


Weintraub, Sidney. 1959. A General Theory of the Price Level, Output, In come Distribution, and Economic Growth. Philadelphia: Chilton.


. 1966. A Keynesian Theory of Employment,

Growth and Income


Distribution.Philadelphia: Chilton. Wiles, PeterJ. 1956. Prices, Cost and Output.Oxford: Basil Blackwell.


. 1979-80.



and Neoclassical


Journal of Post Keynesian Economics 2 (Winter):