Rothbard on Economic Paradigms

Murray Rothbard made a succinct summary of Thomas Kuhn’s notion of paradigms and some interesting comments about it related to economic theory in his ‘Ludwig von Mises and the Paradigm of Our Age’ (here, also here).

Rothbard’s summary: Professor Kuhn provided a comprehensive model of the adoption and maintenance of scientific belief. He states that scientists adopt a fundamental vision or matrix of an explanatory theory, a vision that he calls a “paradigm.” And whatever it is, it governs all scientists in that field without being any longer tested or questioned, and further research comes from minor applications of the paradigm, clearing up loopholes or remaining anomalies. But gradually the anomalies pile up, and the paradigm weakens. Rather than being give up, patches and ad hoc adjustments are made. When the unresolved anomalies are big enough, a “crisis situation” is recognized, until it can be replaced by a new, comprehensive, competing theory that avoids or solves the pre-existing anomalies. It’s a “scientific revolution.” Even then, there remain those who hang on to the older theory, at least partly.

Without adopting Kuhn’s philosophical relativism, it becomes clear that intellectual vested interests play a more dominant role than open-minded testing, it may happen that a successor theory is less correct than a predecessor. If true, we must be open to the possibility that as discarded theories are forgotten and not looked at again, they may have contained scientific truth.

To whatever extent Kuhn’s thesis is correct about the physical sciences, where empirical and laboratory tests are obtained fairly easily, how much more it must be true in philosophy and the social sciences, where no such laboratory tests are possible.

Until recent decades, the classics of philosophy, political theory, and economics were read not just for antiquarian interest but for the truths that might lie there. The student of philosophy read Aristotle, Aquinas, or Kant not as an antiquarian game but to learn about answers to philosophical questions. It was not assumed that, as in physical sciences, all the contributions of past thinkers had been successively incorporated into the latest edition of the currently popular textbook, and it was therefore not assumed that it was far more important to read the latest journal article in the field than the classic works.

In recent decades the social sciences have been increasingly divorced from reality. They substitute statistics for experiment, abstract math, narrow specialties, writing technical minutiae for journals and not writing treatises characterize the discipline.

Rothbard continues, lamenting the effect on economics. “Of all the tragedies wrought by this collective amnesia in economics, the greatest loss to the world is the eclipse of the Austrian school.”