Author:
Dr. Aymen Bouganmi is a researcher and a professor at the Tunisian University. He has published several books, research studies and articles specializing in politics and geo-economics in Arab and foreign newspapers and websites.
In a world of regressing democracy, exploding inequalities and unprecedented threats of climate change, it is striking how economic expertise is constantly being rejected by public opinions. When economists say that protectionism is usually counterproductive, most people are convinced that economic nationalism is self-evident. When experts argue that governments are not the best of managers, and therefore are not very well positioned to provide sustainable economic growth, the public responds that governments are mainly needed to provide economic development. When economic thinkers conclude that small countries need liberalism more than big ones, the doxa answers that free trade is little more than a neo-colonial imperialistic sham.
The question is: How this systematic opposition between technical findings and public opinion can be explained and, more importantly, overcome? What makes this question all the more difficult to answer is that, paradoxically enough, most of economic conclusions are not necessarily counterintuitive. I mean that, at the end of the day, economy is not quantum physics. In fact, despite some complexity, this discipline is not particularly famous for any systematic rejection of daily observations, common sense or basic intuitions. On the contrary, most economic postulates are little more than systematic generalizations of relatively uncontroversial knowledge. Therefore, one would expect a greater understanding from a public that shares with experts most of their basic assumptions. And yet, this is far from being the case.
Part of the knee-jerk reaction generates that economic discourse can be easily explained by the nature of its discourse. Though personal gains and individual interests may seem, and indeed are, fundamentally reductionist, economists argue that it would be a great mistake to ignore them. For most of these experts, it is a part of their job to think about the best ways to recognize these aspects of human nature, to study them, and to eventually try to use their power for a more inclusive benefit. In the process, economists may, consciously or not, give the impression of forgetting other less materialistic sides of humanity.
Though this conclusion might be justified in many cases, such a generalization is fundamentally and historically wrong. Most economists do understand that social norms, religious creeds, high-minded values, psychological considerations and even misleading assumptions are at least as important in determining human reactions as materially-oriented and rationally-calculated incentives. It is not a mere coincidence that Adam Smith wrote about moral sentiments as well as economic interests. Indeed, as a philosopher, the founding father of classical liberalism was deeply aware that people are psychologically torn between their egoistic drive and their altruistic consciousness. While the latter acts as an impartial spectator pushing humanity toward recognizing the just and the good, the former would typically respond to less glorious motivations.
In reality, it is not a very surprising conclusion to say that humans basically prefer to emphasize their better and more collective side; a tendency that puts them at odds with the incentive-based, financially-focused economic discourse. And here lies the core issue. While individuals pretend that their moral side – the impartial spectator in Adam Smith’s language – remains decisive even when their own personal interests are clearly involved, economists remind them that this can hardly be expected from all people. As a consequence, material considerations deserve some interest, not only because they help targeting the greatest number, but also because they represent the most effective tools for an objective and not patronizing policy making. For example, in professional settings, those who are morally motivated may benefit, or in any case, cannot be injured by financial incentives or disincentives. However, the absence or existence of these factors may make all the difference for less principled people. These mechanisms are but short-term patching? Yes, maybe. But decision-making is ultimately a short-run issue. Keynes poignantly expressed this reality when he said: “On the long-run, we are all dead.”
The situation is further complicated by the complex nature of economy. In reality, and whether economists like it or not, economy is never purely economic. Its social, moral and political implications, especially in times of hardship and discontent, do not typically correspond to the cold-blooded approach that many economists see as necessary to preserve the scientific value of the discipline. Furthermore, economists tend to think that their methodologies have at least some legitimacy to deal with scarcity-conditioned issues, even when the challenges clearly go beyond economic matters. This so-called economic imperialism is more often than not associated with neo-liberalism, an ideology that seems to mobilize all forms of negative strong feelings among public opinions.
The issue is of a paramount importance and can be summarized as follows: How informed expertise can fight against populist narratives in a democratic age? An honest answer to this question would be “it can’t”. Economic analyses are too complex to weigh against any simple narrative. In public matters, it is a well-known wisdom that a simple story, even an obviously false one, has a decisive comparative advantage against any complex explanation, even when it is unquestionably correct. Our human minds have a pronounced preference for all-embracing well-adjusted plots. Above all, it hates contingent variables, detailed mechanisms and obscure figures. And these are the very tools of economy and the very means that economists use to bestow some objectivity on their discourse.
Torn between the requirements of their discipline and their deliberative duties, economists need stories. This solution is not without serious disadvantages. Analogies do help, and economists often use them as insightful instruments. However, no economist would readily accept to reduce the economic knowledge to a story telling activity. And yet, beyond its technical aspects, this is exactly what economists do all the time. For example, when a link is established between a certain patterns of behaviours – it may be the choice of a school, the buying of a car, the preference of an insurance company, or any other economic decision – and a social status, an economic situation or a financial motivation, a story is told. The question that remains is: why experts find it much easier to tell a difficult and complex story than to simplify it in order to make it accessible for the widest possible audience?
On the other side of the spectrum, some effort must be done, both individually and collectively, to understand the simple fact that when things are too simple, they are probably wrong. Though complexity alone is not a guarantee of truth, simplicity must necessary have limits. How else the need for expertise can be justified?
I conclude by proposing a narrative about the different roles of economists in public life; and there are at least four. Like physicists, economists look for fundamental laws. Like engineers, they propose workable models. Like mechanics, they try to fix things. And like politicians, they tell stories. Sadly, most economists fail miserably with the last task. Though further efforts must be made, it is useful to add that current conditions do not make things easy. Because it is difficult indeed to tell a good and simple story about a world that is getting everyday more complex and less attractive for most people.
Author:
Dr. Aymen Bouganmi is a researcher and a professor at the Tunisian University. He has published several books, research studies and articles specializing in politics and geo-economics in Arab and foreign newspapers and websites.
In a world of regressing democracy, exploding inequalities and unprecedented threats of climate change, it is striking how economic expertise is constantly being rejected by public opinions. When economists say that protectionism is usually counterproductive, most people are convinced that economic nationalism is self-evident. When experts argue that governments are not the best of managers, and therefore are not very well positioned to provide sustainable economic growth, the public responds that governments are mainly needed to provide economic development. When economic thinkers conclude that small countries need liberalism more than big ones, the doxa answers that free trade is little more than a neo-colonial imperialistic sham.
The question is: How this systematic opposition between technical findings and public opinion can be explained and, more importantly, overcome? What makes this question all the more difficult to answer is that, paradoxically enough, most of economic conclusions are not necessarily counterintuitive. I mean that, at the end of the day, economy is not quantum physics. In fact, despite some complexity, this discipline is not particularly famous for any systematic rejection of daily observations, common sense or basic intuitions. On the contrary, most economic postulates are little more than systematic generalizations of relatively uncontroversial knowledge. Therefore, one would expect a greater understanding from a public that shares with experts most of their basic assumptions. And yet, this is far from being the case.
Part of the knee-jerk reaction generates that economic discourse can be easily explained by the nature of its discourse. Though personal gains and individual interests may seem, and indeed are, fundamentally reductionist, economists argue that it would be a great mistake to ignore them. For most of these experts, it is a part of their job to think about the best ways to recognize these aspects of human nature, to study them, and to eventually try to use their power for a more inclusive benefit. In the process, economists may, consciously or not, give the impression of forgetting other less materialistic sides of humanity.
Though this conclusion might be justified in many cases, such a generalization is fundamentally and historically wrong. Most economists do understand that social norms, religious creeds, high-minded values, psychological considerations and even misleading assumptions are at least as important in determining human reactions as materially-oriented and rationally-calculated incentives. It is not a mere coincidence that Adam Smith wrote about moral sentiments as well as economic interests. Indeed, as a philosopher, the founding father of classical liberalism was deeply aware that people are psychologically torn between their egoistic drive and their altruistic consciousness. While the latter acts as an impartial spectator pushing humanity toward recognizing the just and the good, the former would typically respond to less glorious motivations.
In reality, it is not a very surprising conclusion to say that humans basically prefer to emphasize their better and more collective side; a tendency that puts them at odds with the incentive-based, financially-focused economic discourse. And here lies the core issue. While individuals pretend that their moral side – the impartial spectator in Adam Smith’s language – remains decisive even when their own personal interests are clearly involved, economists remind them that this can hardly be expected from all people. As a consequence, material considerations deserve some interest, not only because they help targeting the greatest number, but also because they represent the most effective tools for an objective and not patronizing policy making. For example, in professional settings, those who are morally motivated may benefit, or in any case, cannot be injured by financial incentives or disincentives. However, the absence or existence of these factors may make all the difference for less principled people. These mechanisms are but short-term patching? Yes, maybe. But decision-making is ultimately a short-run issue. Keynes poignantly expressed this reality when he said: “On the long-run, we are all dead.”
The situation is further complicated by the complex nature of economy. In reality, and whether economists like it or not, economy is never purely economic. Its social, moral and political implications, especially in times of hardship and discontent, do not typically correspond to the cold-blooded approach that many economists see as necessary to preserve the scientific value of the discipline. Furthermore, economists tend to think that their methodologies have at least some legitimacy to deal with scarcity-conditioned issues, even when the challenges clearly go beyond economic matters. This so-called economic imperialism is more often than not associated with neo-liberalism, an ideology that seems to mobilize all forms of negative strong feelings among public opinions.
The issue is of a paramount importance and can be summarized as follows: How informed expertise can fight against populist narratives in a democratic age? An honest answer to this question would be “it can’t”. Economic analyses are too complex to weigh against any simple narrative. In public matters, it is a well-known wisdom that a simple story, even an obviously false one, has a decisive comparative advantage against any complex explanation, even when it is unquestionably correct. Our human minds have a pronounced preference for all-embracing well-adjusted plots. Above all, it hates contingent variables, detailed mechanisms and obscure figures. And these are the very tools of economy and the very means that economists use to bestow some objectivity on their discourse.
Torn between the requirements of their discipline and their deliberative duties, economists need stories. This solution is not without serious disadvantages. Analogies do help, and economists often use them as insightful instruments. However, no economist would readily accept to reduce the economic knowledge to a story telling activity. And yet, beyond its technical aspects, this is exactly what economists do all the time. For example, when a link is established between a certain patterns of behaviours – it may be the choice of a school, the buying of a car, the preference of an insurance company, or any other economic decision – and a social status, an economic situation or a financial motivation, a story is told. The question that remains is: why experts find it much easier to tell a difficult and complex story than to simplify it in order to make it accessible for the widest possible audience?
On the other side of the spectrum, some effort must be done, both individually and collectively, to understand the simple fact that when things are too simple, they are probably wrong. Though complexity alone is not a guarantee of truth, simplicity must necessary have limits. How else the need for expertise can be justified?
I conclude by proposing a narrative about the different roles of economists in public life; and there are at least four. Like physicists, economists look for fundamental laws. Like engineers, they propose workable models. Like mechanics, they try to fix things. And like politicians, they tell stories. Sadly, most economists fail miserably with the last task. Though further efforts must be made, it is useful to add that current conditions do not make things easy. Because it is difficult indeed to tell a good and simple story about a world that is getting everyday more complex and less attractive for most people.
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