Measurement, Quantification and Economic Analysis: Numeracy in Economics.
Measurement, Quantification and Economic Analysis compiles twenty-four papers, most of which appear for the first time, which relate to the roles of measurement and quantification in the development of economic theory; neoclassical economics is emphasized. Rima undertakes the formidable job of imposing order upon them in her paper "From political arithmetic to game theory: an introduction to measurement and quantification in economics" [pp. 1-21].
According to Rima there have been three broad stages of development. In the first, roughly coinciding with mercantilism, "the essential role of measurement and quantification tools was to serve as a policy instrument." This was the era of Petty, Graunt, and King. In the second, "the chief concern of measurement and quantification techniques was the discovery of static economic laws." Here Smith and Marshall seem to define the time period. Finally, in the third stage, "economics is perceived to have emerged . . . as a true science; mathematical formalism is relied on to create economic models which are joined to gaming experiments and econometric tests to evaluate whether the outcomes they generate from data are consistent with the model's predictions" [p. 3]. This is the era of Hicks and Samuelson, Tinbergen and Haavelmo, von Neumann and Morgenstern. It is our era.
Rima's paper leaves one with the impression of progress from the simple to the complex, from the naive to the sophisticated, from the amateur to the professional. As such the development of numeracy and quantification in economics appears as the time equivalent of the Amazon River, originating in the isolated streams of the distant Andes and the earth-laden rivers of the Brazilian forests, continually joining and relentlessly flowing toward oneness with the Atlantic Ocean. There can be little doubt that the progress to which Rima refers has taken place.
It must be recognized, though, that many of the papers of this volume rest uncomfortably in a framework in which the progressive aspects of the development of numeracy and quantification are stressed. In fact, the papers generally draw upon history to make inferences about the role of mathematics in economic analysis -- some outrightly critical. As such they provide historical examples of many of the issues raised in the symposium "Has Formalization in Economics Gone too Far" which was published in Methodus in June 1991.
What is striking about the work as a whole is the repeated use of polarities -- historical/logical time, subjective/objective knowledge, social/natural science, reversible/irreversible time, induction/deduction, state/process, concrete/abstract, and laws/facts -- to advance arguments.(1) An illustration of this is the excellent paper by Judy L. Klein on "The method of diagrams and the black arts of inductive economics," in which she develops a classification based upon historical/logical time and law/fact curves to shed light on the use of diagrams in the natural sciences and the social science of economics. Polar thinking also figures prominently in "Is emotive theory the philosopher's stone of the ordinalist revolution?" by John B. Davis. One could go on.
Overall Measurement, Quantification and Economic Analysis provides historical essays on specialized aspects in the development of numeracy in economics which are generally placed in a broader methodological context. Despite the emphasis on polarities above, one does not sense that any of the contributors would care to make a case for excising mathematics from economics. In this way the contributors seem to have collectively come to the conclusion reached by F. Y. Edgeworth in 1889, when he wrote "What we are concerned to discover is not so much whether mathematical reasoning is useful, but what is its `final utility' as compared with other means of research" [1, vol. II, 290]. This book refers most explicitly to the final utility of mathematics -- those who are interested in this, as well as Edgeworth's larger project, will want to read it from cover to cover.
(1.) These polarities are of relevance in part because of their relationship to recent feminist scholarship
[1.] Edgeworth, F. Y. Papers Relating to Political Economy. New York: Burt Franklin, 1970, first published, 1925.
[2.] Ferber, Marianne A. and Julie A. Nelson, editors. Beyond Economic Man: Feminist Theory and Economics. Chicago: University of Chicago Press, 1993.
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|Publication:||Southern Economic Journal|
|Article Type:||Book Review|
|Date:||Oct 1, 1996|
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