Those of you who have read my blog for a while might recall I wrote an incomplete critique of Frank Stilwell’s Who Gets What?, a book that analyses income and wealth inequality in Australia. Coincidentally, I’m currently doing a summer school course called Economics as a Social Science, a long-standing core subject in the Political Economy stream, that is coordinated by Stilwell and uses the textbook he wrote, Political Economy: the contest of economic ideas. It’s essentially a short history of economic theory, divided into these broad categories:
- classical political economy
- Marxian analysis
- neoclassical economics
- institutional economics
- Keynesian economics
- modern political economy
I knew that the course was created by Stilwell, and would therefore exhibit some bias (to be fair, bias is ubiquitous and unavoidable), but it is still amusing to see how striking it can be. I haven’t ever met or communicated with Stilwell, so I’m not privy to his actual socio-economic views and therefore can’t tell if he’s really tried to be objective and neutral in the textbook and the bias is just bleeding through, or if he didn’t bother reining in his personal beliefs and set out to write a polemic. I’d prefer that in truth he attempted the former and failed, rather than think that he’s deliberately seeking converts in impressionable students.
I don’t have the time or inclination to do a comprehensive analysis of every possible instance of bias in what I’ve read so far (we’re not quite halfway through the course), so I’ll just give you a taste.
Throughout the textbook, the differences in the language employed set a distinctive tone. Passive voice is used when talking about the failure of Keynesian ideas in the 1970s, for example, while the reader is left in no doubt what is the cause of free-market failures (at least in Stilwell’s opinion). There are several mentions of how modern laissez faire economists have ignored key caveats and moral considerations in Adam Smith’s work, and a constant emphasis on how the difference between the nature of capitalism in the classical period and today’s economic structure casts doubt on extrapolating insights gained in that era to modern times. Yet there is almost no discussion of similar problems with Marxian analysis – indeed, what ones there are tend to be defensive of Marx’s theoretical shortcomings. In other words, while Stilwell observes that the various classical theories were embedded in a certain socio-economic context, for Marxian ideas it’s a reason to forgive their predictive failures, while for the non-interventionists it’s a reason to label their ideas as incomplete, if not irrelevant.
When I went from reading the chapters on Marx to those on neoclassical thought, there was a noticeable change in style. For Marxian ideas, it was a straightforward explanation of their basis and development.The language was classic dry textbook, and Stilwell appeared to accept the theoretical elements as given – all the better to explain them and their relevance. Not so for the neoclassical section. Suddenly Stilwell was writing from a critical perspective, continually asking questions about assumptions and justifications, unfavourably comparing theory to practice, emphasising the limits of the theory. An examination of the Key Points section at the end of each chapter is illuminating. Take this representative selection from the Marx chapters:
- Its breath [sic] of scope is exceptional in that it focuses on social classes, exploitation, monopoly power, capitalist expansion and uneven development, commodification and alienation, the state and social change.
- Because the capitalist mode of production is based on a class-based relationship between capital and labour, the system is fraught with conflicts related to the organisation of work and the distribution of income.
- Part of the value of produced by labour is captured by employers. This surplus value is the source of capitalist profits but it also flows to many other sections of the economy and society.
- Historically, capital accumulation goes hand in hand with the reproduction of a reserve army of labour, the concentration and centralisation of capital, and the process of imperialism.
- …fundamental contradictions arise in the capital accumulation process.
- Disproportionalities may develop into recessions because of the lack of planned industry coordination in a market economy.
- The tendency of the rate of profit to fall may also lead to economic crises as the capital accumulation process raises the organic composition of capital.
You can see how these points take the Marxian perspective for granted. Which is fair enough, the textbook is trying to instruct the reader on that perspective and how its elements interrelate. Now compare that approach to these points from the neoclassical chapters:
- It also conveys a distinctive ideology – representing the market as the necessary underpinning for freedom of choice and for the efficient allocation of economic resources.
- [Outlines two assumptions] Both of these assumptions are questionable.
- This representation of firms as engines of efficiency is a focal point for critics of neoclassical economics.
- Critics of neoclassical theory emphasise that this idealised view of market structures neglects many aspects of actual business behaviour that involve the use of economic power.
- Critics of neoclassical theory contend that distribution is more fundamentally shaped by the power relationships between the owners of labour, capital, and land.
- An economic equilibrium is not necessarily a social optimum. Judging by what is desirable requires explicit welfare criteria, but the attempts by neoclassical theorists to develop such criteria have proved deeply problematic.
The contrast is stark. Every proposition is questioned. Critics are referenced at every turn. Every theoretical gap is given a pry. Problems are highlighted, while achievements are minimised or simply ignored. Which is a valid approach – after all, you want university students to learn how to view the status quo through a critical lens – but it is telling that this method is used for the stream of economic thought with which Stilwell disagrees, and not for that with which he sympathises.
Taking the textbook at face value, one would have to conclude that Marxism is a description of the world as it really works, while neoclassical thought is a “problematic”, “tautological”, “superficial”, “limited” and “contentious” theoretical structure that bears little resemblance to reality and is principally ideological in nature.
I guess Stilwell and I will have to agree to disagree on that one.