Over at Division of Labor, Larry White makes some insightful comments on the recent article in The Nation and subsequently commentary related to mainstream and heterodox economics.
In some recent writings I have tried to introduce the distinction between mainstream and mainline to clarify the issues. The mainline of economic argument traces from Smith and Hume, through Say and Bastiat, up to Mises and Hayek, and many writers in between and beyond. The common thread is the proposition of the self-correcting nature of the market economy within specified institutions. The mainstream of economic argument refers instead not to any substantive proposition, but instead to what is intellectually and politically popular at any given point of time. Keynesianism, for example, was mainstream, but not mainline. Austrianism has been mainline, but rarely mainstream in the history of the school. Throughout much of the history of the discipline of economics and political economy, the proposition of self-correction was the subject of debate --- you either believed the mainline argument or you rejected it.
What it means to be "mainstream" today is completely devoid of any substantive proposition about the self-correcting properties of the market economy. Though the topic still is addressed, one could very well be a major player in the economics profession and remain completely agnostic on this topic. That means that the nature of the discourse which young economists enter into the profession requires a more subtle understanding of the current issues in order for them to succeed. It is part technical abilities, part pedigree, and part skill at taking advantage of intellectual opportunities. But you cannot fly blind and expect to succeed. Larry's discussion and the links are a great place to start to see what is going on.
What is the motivation behind economist who take mainstream views? Are they simply ingnorant of the mainline economics or intentionally wrong for popularity reasons/sense of altruism? A good example would be Jeffrey Sachs and an earlier example Paul Samuleson.
Posted by: Matt C. | June 01, 2007 at 01:30 PM
Matt C, maybe you should wonder how it was that the current mainstream became dominant and deviated from the mainline? Before it became popular there must have been a reason other than popularity and ignorance. I am not trying to suggest that the mainstream is right and the mainline is wrong, but I am suggesting that your explanation of motivations is insufficient.
Posted by: TGGP | June 01, 2007 at 11:09 PM
By the way, I think most mainstream economists consider themselves to be following in the mainline, but are simply a step up. The only economists I can think of off the top of my head that dismissed the importance of Adam Smith are Rothbard and Schumpeter (even Marx was a follower of Ricardo and, through him, Smith).
Posted by: TGGP | June 01, 2007 at 11:11 PM
TGGP I was merely posing a question, not suggesting a motive. But it would seem by your explanation that to a certain extent they are simply ignorant, rather than intentionally, of what their theories suggested. Marx is the good example, because he was simply wrong about the surplus value of labor, which led him to all his other conclusions. The question then has to be, was Marx just trying to justify his philosophical belief that capitalist were 'abusing' their workers?
My understanding of Rothbard's dismissal of Smith was more philosophical, where Adam Smith didn't go far enough with his belief in an unfettered market. Please correct me if I am wrong here.
Posted by: Matt C. | June 02, 2007 at 11:23 AM
In effect, Rothbard said of Smith that what was original in him was not correct and what was correct in him was not original. Rothbard thought Smith did not contribute but harmed the field of economics. I started a bit of a stir at Mises.org when I linked to a usenet discussion where David Friedman criticized Rothbard's discussion of Smith. Writers at the site continued to back up Rothbard, and in many prior articles they had attacked Smith (David Friedman responds in the comment section here: http://blog.mises.org/archives/005182.asp ). It is the consensus of many that Adam Smith introduced the labor theory of value (not Marx), though some dispute this. It is not in dispute that Marx was not being original in coming up with a labour theory of value. That was common among classical economists. It met its demise with the advent of the marginal revolution brought about by Menger, Jevon and Walras.
Posted by: TGGP | June 02, 2007 at 06:24 PM
I am well of how the value theory of labor was changed with the marginal revolution, of this I am not ignorant.
Thanks for the debate link though.
Posted by: Matt C. | June 02, 2007 at 11:09 PM