This is just too good a comment to pass up.
I’ve had to study Public Choice Theory as part of my economics degree, and it really is the biggest load of rubbish I’ve ever read, and sums up how economics is not a science, but simply a pseudoscientific enterprise designed to promote the interests of the wealthy. We’re told by economists that governments are effectively rent seekers, who are not interested in the welfare of society but simply to feather their own nets. Their solution seems to be to privatise government and the let the market rule everything. Funny how neoliberal economists never apply their sceptical public choice theory to look at, for example, executive pay (and the cosy cartel that sets it), or the way businesses through extensive lobbying and funding given governments incentives to pursue policies in the interest of the 1%.
I’m glad there are economics students who also think what we learn is a lot of rubbish, and how biased the subject is towards neoliberalism. I’ve had to sit through 3 years of listening to my lecturers trying to convince me that the welfare system is hugely distortionary, high progressive income taxes are undesirable and should be replaced by flat taxes, privatisation of industry will improve efficiency and that governments shouldn’t do anything about poverty and inequality because it would “distort” their beloved market.
It’s high time people started questioning the pseudoscientific BS we’re expected to swallow. Eventually, with more people starting blogs like this exposing the subject (along with disbelievers like Steve Keen) hopefully funding for economics will dry up, and the discipline will cease to exist as a serious academic endeavour, like astronomy, and therefore will stop influencing policymakers.
Err, no. Public choice theory isn\’t stating that governments are merely predatory rent seekers.
It\’s saying that you can understand a lot about what goes on if you view them as such sometimes. It\’s a very useful explanation of why MPs\’ pensions are better than those of anyone else in the country. Why the PM\’s pension is simp[ly fantabulous.
Really, at heart, all that is being said is that the first thing to learn about economics is that incentives matter. So, look at the incentives of those in government as well as those out of it.
And the welfare system is distortionary: 70-90% (there are some poor souls over 100%) marginal tax and benefit withdrawal rates are distortionary. It might be worth having these distortions to reach your other goals, it might not be, but it\’s very definitely distortionary. High progressive income taxes might be desirable for some reasons….reducing inequality of income perhaps. But they also have other effects: such as reducing future economic growth. Which is the second thing you need to learn about economics. There\’s no such thing as a solution, there are only trade offs.
And you\’d better bloody well understand the trade offs you\’re making when you make decisions: which is what your economics course is trying to train you to do but obviously failing.
BTW, it\’s astrology you mean, not astronomy.
And most amusing is this from our unlearning econ guy:
Yes that sums up many problems with economics pretty well. My lecturers are actually about as moderate as it gets in a mainstream university so I’m lucky, but I still find it hard to write about models that I know are just wrong. It seems you felt similarly.
This is known as \”Doing a Ritchie\”.
Ignoring what you\’re being taught because it\’s obviously wrong, innit?
And you only need to read Ritchie to see where that leads you. About which I think my favourite is his reinvention from first principles of marginal utility as a refutation of neo-classical economics: neo-classical economics being the form of economics which introduced marginal utility, indeed, neo-classical economics being based on the insight of marginal utility. That\’s why we call it all the Marginalist Revolution, see?