Economics is a language of models and equations. Yet its foundations are philosophical. Giving heterodox currents back their rightful place means restoring the vitality and pluralism of this discipline - and thus its link with liberalism.
Despite their sometimes sharp differences, liberals share a common conviction: pluralism is necessary. Pluralism is the foundation of liberal democracy, with party competition, the circulation of ideas and the confrontation of opinions. Pluralism prevents politics from becoming dogmatic, and gives it vitality. In economics, however, this pluralism is discreet. For several decades now, the neoclassical trend[1] has become the dominant framework. It inspires major international institutions, university teaching and public policy alike.
Measuring a country's economic dynamism by its GDP, explaining unemployment by labor market rigidities... This language has become that of the obvious, and likes to present itself as the very form of scientific rigor, giving its postulates an almost dogmatic status. This ambition can be explained at least in part by the origins of economic liberalism. Born between the 17th and 18th centuries, in a context marked by the scientific revolution, it sought to establish itself as a kind of science, capable of describing the laws of economics as Newton had described those of the physical world.
Nevertheless, as many now recognize, including liberals, the analogy is more than problematic. Economics is not a hard science. It is based on philosophical assumptions, models and presuppositions. It presupposes a conception of man - the rational individual guided by self-interest, in the case of the neoclassical school - that is more a matter of intellectual construction than observation. It also involves political and theoretical choices: the role of the State, the purpose of economic activity, the very definition of the market. The project of a self-sufficient economy is based more on a theoretical ideal than on a faithful description of human behavior.
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This is why economics has always been riddled with fundamental debates. This irreducible pluralism, absent from the exact sciences (mathematics, theoretical physics...) where theories can be definitively settled by logical demonstration, remains constitutive of the development of economics. This is reflected in the history of economic thought: Smith is not Ricardo, Marx is not Keynes, Hayek is not Keynes either. Far from being a mere archaeological curiosity, this history provides the keys to understanding today's crises. Placed in a long-term perspective, the problems of sovereign debt, trade wars and ecological transition take on a dimension that cannot be captured by the equations of contemporary analysts alone.
This diversity of approaches is not noise, but a source of richness. It is recognized by a term that aptly describes the existence of multiple paths in economics: ’heterodoxy«. The word is often used to refer to left-wing political currents, such as radical Keynesians or institutionalists, who challenge the dominance of the market and insist on the role of social structures. But there are also right-wing heterodoxies. The Austrian school is the best-known example. Led by figures such as Friedrich Hayek and Ludwig von Mises, and advocating more liberal ideas than the neoclassical schools, this intellectual tradition rejects the excessive mathematization that has invaded the discipline, and defends a conception of economics centered on individual action. For its thinkers, time, uncertainty and the experience of actors are more important than models.
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Unfortunately, there's a strong tendency to think in a more or less imposed economic vocabulary: market equilibrium, the rationality of players, and so on. However, since these notions are not neutral and reflect theoretical and ideological choices, to accept them without discussion is to wrongly forbid ourselves to think differently. In a democracy, economic debate must remain lively, confrontational and open. This is the only way to avoid the comfort of a lukewarm consensus and restore economics to its rightful place in public debate.
Every month, a member of the editorial team takes a stand on a subject related to the issues addressed in Le Regard Libre. Write to the author: antoine.bernhard@leregardlibre.com
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[1] Its latest variant, considered the current orthodoxy, is the «new neoclassical synthesis», which incorporates neo-Keynesian elements.
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