Why Science Writers Should Stick to Science

Steven Horwitz

So my Bastiat-inspired volcano piece got linked by a writer for the National Association of Science Writers."  She recognized that I "intended irony," but she's not so sure my argument is bad:

"At Xchange, the Nightly Business Report blog, Steven Horwitz lists economic benefits resulting from Eyjafjallajokull's antics. The big boost to the lodging industry and money spent on cleanup, for instance. He intends irony, but I wonder. It must be true that British Airways's loss is the Dorchester's gain."

I sent her a quick email noting that she had fallen for the fallacy and pointing out her error.  We'll see if she responds.  But it just goes to show that the work of economic education is never done, especially perhaps with science types.

Comments

[Daniel Kuehn]

Although to be fair, her focus on the juxtaposition of individual level costs and benefits doesn't contradict Bastiat's insight about aggregate costs and benefits. I don't think Bastiat ever argued that the glazier got screwed over by the broken window - simply that his good fortune (if we can call it that) shouldn't comfort anyone. :)

[Niko]

Daniel,

Can you calculate the multiplier if you would buy the necessities for a shave?

[Daniel Kuehn]

I can't even make sense of that Niko

[Niko]

Daniel,

Neither does the multiplier ...

[Robert Scarth]

My brother-in-law (who has a PhD in Astrophysics) once said to me that Physics is easy, but Economics is hard. His reason was that in Physics all key quantities (energy, mass etc) are conserved, whereas in Economics nothing is really conserved. I think that this way of thinking is very firmly embedded in scientists' brains, and when they try an analyse anything they tend to do so by assuming the key quantities are conserved - I don't think its conscious, its more a habit of mind. For economic questions the scientist naturally assumes that wealth is conserved, hence "It must be true that British Airways's loss is the Dorchester's gain".

[Richard Ebeling]

John Maynard Keynes once asked the famous physicist, Ernst Mach, if he had ever tried to study economics.

Mach replied that he had tried, but it gave it up because there were too many variables simultaneously changing and interacting.

(Keynes mentions this in his "memorial" essay for Alfred Marshall.)

This is in line with Hayek's comment that in comparison to the "complexity" of social phenomena, the natural sciences dear with far more "simple" phenomena.

It is not surprising, therefore, that following the logic of economics is often a bit difficult for both (natural) scientists and laymen.

In the "Wealth of Nations," Adam Smith referred to this as the "prejudices" of the public, who find it difficult to follow the reasoning that free trade would be more effective to improve the human condition than conscious planning by what Smith called the "man of system" (the social engineer).

Richard Ebeling

[GabbyD]

i dont get what she got wrong.

isnt that the point of broken windows? that the broken window only shifted the pattern of spending, not raised overall/total spending?

[Otto Maddox]

The point? Society is worse off due to the loss of material well being, whether it is a broken window or an exploding volcano that reduces wealth.

[Chris A.]

Isn't her mistake that she thinks the total economic pie stayed the same size, as opposed to seeing that whatever lodging facilities might gain is more than balanced out by what airway companies and travelers lose in opportunity costs and time?

[topills.com review]

. I think that this way of thinking is very firmly embedded in scientists' brains, and when they try an analyse anything they tend to do so by assuming the key quantities are conserved - I don't think its conscious .