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vociferous critics of economic models are often politically motivated. They have very strong ideas
about what they want to believe; their convictions are essentially driven by values rather than analysis,
but when an analysis threatens those beliefs they prefer to attack its assumptions rather than examine
the basis for their own beliefs.
Still, there are more creditable reasons for disliking economic modeling, or at least the kind of models
that make up mainstream economics. To many intelligent people the whole tone of economics seems
strange and off-putting. On one side, there seems to be a near-total lack of social or psychological
texture economists are notoriously uninterested in how people actually think or feel. On the other side,
there is what appears to most people to be a bristling mathematical complexity, with its accompanying
strange jargon. Even someone who can accept that a dishpan tells us something about global weather
may be totally unconvinced that a set of equations tells us anything useful about the global economy.
There is a significant group of intellectuals who regard the whole mainstream tradition in economics as
a kind of aberration, which will eventually be discarded; who regard all of us as, in the words of John
Kenneth Galbraith, a ''failed profession."
As you might guess, of course, I do not share that view. In fact, I would claim that the very things in the
tradition of economics that most repel the layman are its greatest virtues. Economics is marked by a
startling crudeness in the way it thinks about individuals and their motivations, yet it builds a huge
structure on the basis of these simplistic foundations. Is this naive? No: it is in fact tremendously
sophisticated.
At base, mainstream economic theory rests on two observations: obvious opportunities for gain are
rarely left unexploited, and things add up. (Or as I sometimes put it,
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