Friday, October 7, 2011

How the Dismal Science Stopped Being Dismal

by Justin Fox

New York Times

October 7, 2011

Listen to the economic debates of the past couple of years, and it’s tempting to conclude that no progress has been made in the field in over half a century. There’s John Maynard Keynes on the one side, arguing for deficit spending to offset the aftereffects of a once-in-a-lifetime financial crisis. On the other side there’s Ludwig von Mises (his fellow Austrians Joseph Schumpeter and Friedrich von Hayek seem too moderate for the role), thundering that all govern­ment intervention in the economy is doomed to failure.

Keynes and Mises are of course both long dead. But it is the resilience of their ideas that makes studying the history of economics so rewarding for non­economists. As a rule, economists don’t know much about history. So at times like these, anyone with a bit of familiarity with the giants of the past can weigh in on big economic issues with about as much authority and credibility as the credentialed experts.
Alfred Marshall, in 1892

This is one explanation for the continuing popularity of Robert L. Heilbroner’s book The Worldly Philosophers: The Lives, Times and Ideas of the Great Economic Thinkers. Another is that once a book makes its way onto undergraduate required-­reading lists, as Heilbroner’s did, it doesn’t easily fall off. Heilbroner wrote his irreverent group portrait of Keynes, Schumpeter, Karl Marx, Adam Smith and others in the early 1950s while studying for a doctorate at the New School for Social Research in Manhattan. (Mises was so marginalized at the time he didn’t rate a mention.) He died in 2005, but his book lives on, with more than four million copies sold.

That kind of success makes a tempting target for imitators, and over the past decade, word spread among economics writers that Sylvia Nasar was at work on a new Worldly Philosophers — something to update and possibly supplant Heil­broner. Nasar is no knockoff artist; a professor at Columbia Journalism School and a former economics correspondent for The New York Times, she wrote what is perhaps the best economics-­related book of the past quarter-­century, A Beautiful Mind, a near-perfect biography of the game theorist John Nash.

Now Nasar’s new book, Grand Pursuit: The Story of Economic Genius, is here. As it turns out, it isn’t really a Heilbroner update. For one, it doesn’t make much chronological headway: the postwar giants Paul Samuelson and Milton Friedman get a few pages, as does the philosopher and development economist Amartya Sen, who is still alive and writing books. But the major developments of post-1950 economics are for the most part ignored. So, for that matter, are the major developments of pre-1850 economics. Heilbroner was out to provide an easy-to-digest survey of economic thought through the ages. Nasar has set herself a task at once narrower and more ambitious. She has a story to tell, a story of tragedy, triumph and, as the subtitle says, economic genius.



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