Boulding on the Human use of Human Beings
On the impossibility of 'value-free' economics
When Lionel Robbins wrote his Essay on the Nature and Significance of Economic Science (1932) he set himself two tasks. One was to demonstrate how the main theoretical propositions of modern economics were grounded in 'indisputable facts of experience'. As Robbins' puts it:
'These [basic postulates of economics] are not postulates the existence of whose counterpart in reality admits of extensive dispute once their nature is fully realised. We do not need controlled experiments to establish their validity; they are so much the stuff of our everyday experience that they have only to be stated to be recognised as obvious.'
Lionel Robbins, Essay on the Nature and Significance of Economic Science (1932)
If this is correct, the economist shares with the logician the privilege of being able to do all of his or her work from the comfort of an armchair. Not for Robbins the drudgery of surveying fast-food restaurant managers on the North Atlantic seaboard or investigating the provision of healthcare in rural Rajasthan. Being timeless, the postulates of economics apply with equal force in a New Jersey McDonalds and a clinic in Udaipur, and will presumably hold just as well on Mars, when we get there. This is one of the few areas where Robbins and Keynes are in basic agreement: the returns on empirical-quantitative work are unenticing.
Robbins' other preoccupation was to disentangle economics from moral philosophy. It was in part his effort to arrive at a 'value-free' economic science that led to his famous formulation that economics is the study of the 'relationship between ends and scarce means which have alternative uses'. The 'ends' in this formula are imagined as being given to the economist as an elementary datum. It is for individuals and the societies that they form to establish what has value and what does not. In arriving at these valuations they will not be doing economics. Economic thinking only starts once ends have been established and the right package of means has to be found to bring those ends into existence. Ken Binmore extracts the basic Robbinisian insight when he says 'it is not our business as economists to instruct politicians on what social welfare function they should be operating'.
In a certain mood, I find this view of economics very attractive. It draws a boundary around a set of well-posed problems, with economics thereby turned into a special department of decision theory ('decision making under scarcity'). These questions have intrinsic interest and the mathematical techniques used to handle them are elegant. More importantly Robbins seems to come good on his promise to cut out that great source of paradox - 'Value'. Sadly, my Robbinsian moods, though sweet, are usually short. There is always a nagging suspicion that the price of making economics 'value-free' is to also make it unreal. I am reminded of a quip of the great French writer Charles Peguy: "Kantian moral philosophy has clean hands, but only because it has no hands'. So too, Robbinsian economics.
Now the problem with this is that not only does economics have 'hands', it is the science that most palpably seizes our lives. We all live under its imperial influence, from Bank of England employees, to fire fighters and soldiers and hairdressers and bakers. The 'L' in the production function might seem like an abstract symbol for a subset of Robbinsian ‘means’, but it is really a shorthand for all of us, including you, dear reader. The bestselling popular economics book in circulation, Steven Levitt's Freakonomics, hides in its pages a program for social transformation scarcely less radical than Nietzsche's 'Umvertung alle Werte'.
For an antidote to the Robbinsian view, we can turn to the rather brilliant but neglected economist, Kenneth Boulding, who wanted to do away with the idea of a value-free economics altogether, not because it is unattractive but because it was a travesty of the reality of economic practice. In his short essay 'Economics as a Moral Science', Boulding puts his argument against Robbinsian economics with terrible force. This passage in particular has been etched into my brain since I first read it. It feels like a killing blow:
We cannot escape the proposition that as science moves from pure knowledge toward control, that is, toward creating what it knows, what it creates becomes a problem of ethical choice, and will depend upon the common values of the societies in which the scientific subculture is embedded, as well as of the scientific sub-culture. Under these circumstances science cannot proceed at all without at least an implicit ethic, that is, a subculture with appropriate common values.
Kenneth Boulding, 'Economics as a Moral Science' (1969)
When Boulding talks about the 'values' of the scientific subculture he is committing a modern heresy. We are not allowed to talk about the fact that science is not just a body of knowledge but also a social activity done by normal human beings, and as such has its own cultural patterns. In its purest form, that is with the smallest mixture of any other systems of value, the scientific subculture or ideology can be quite terrifying (c.f. Boulding - 'Science could create an ethical dynamic which would bring it to an end'). But that is matter for another blog.
The main point that is hammered home by Boulding in a couple of paragraphs is that economics cannot escape ethics because it is a science that is involved in problems of control. To borrow that excellent phrase of Norbert Wiener's, economics as it is actually done today, is concerned with the 'human use of human beings'. Wiener meant for that phrase to have an ethical charge because, at least in the first edition of his book, he also talks about the 'inhuman use of human beings'. The Kantian in us might shiver at the combination of 'use' and 'human beings', but that is what economics is all about. That is why, as Boulding tells us, we had better make sure that we are using them in 'human' rather than 'inhuman' ways, and in the service of equally 'human' ends.