I stumbled on this reading before bed tonight. It is one of the classic pieces written by John von Neumann which is used in most history of mathematics courses:
As a mathematical discipline travels far from its empirical source, or still more, if it is a second and third generation only indirectly inspired by ideas coming from ‘reality’ it is beset with very grave dangers. It becomes more and more purely aestheticising, more and more purely I’art pour I’art. This need not be bad, if the field is surrounded by correlated subjects, which still have closer empirical connections, or if the discipline is under the influence of men with an exceptionally well-developed taste. But there is a grave danger that the subject will develop along the line of least resistance, that the stream, so far from its source, will separate into a multitude of insignificant branches, and that the discipline will become a disorganized mass of details and complexities. In other words, at a great distance from its empirical source, or after much ‘abstract’ inbreeding, a mathematical subject is in danger of degeneration. (Von Neumann, The Mathematician, 1947, pp. 180-196)
It is interesting to see that the same could be said of economics when its models become too elegant (l’art pour l’art, neat and structurally sound), esoteric (so as to demonstrate excessive sophistication more than is necessary) and far too detached from the real-world (empirical truths) phenomena it seeks to understand—when it distances itself too far from its empirical source, “or after much ‘abstract’ inbreeding,” it, also, “is in danger of degeneration.”
The world looks to the economics profession once again as the countries the world over fear even greater inequality, environmental degradation, instability even in the wealthiest of nations, the future of work against a worrisome backdrop of a global economy that is slowing down marked by signals that point to a possible recession of a different nature.
In a group chat, some PhDs exchange about the challenges to macroeconomists and how their models do not provide sufficient guidance for thoughtful policy work especially when it seems that the discipline is playing catch-up than potentially leading it. Where its representative household approach, the micro foundations of macro, and its many other assumptions given freely (and quickly) away to make theories upon theories work in the Walrasian general equilibrium sense all now seem to open even more questions than provide answers.
No one holds the perfect answer (I doubt no one would ever), but there needs to be more debate, deeper engagement—meaningful discourse, openness to even more agreement on nuance which makes policy work possible than futile disagreement on which science to use to answer a real-world problem. Science is not the problem, but it does not hold all the answers.
There is much more work AND LEARNING needed which aspiring economists can contribute to, but which may work better if there is agreement that the current mainstream thinking alone cannot solve problems today that no longer have the same nature as of those that were experienced generations ago.