economic imperialism: why did it fail?

When I was a wee academic, people were scared of ECONOMIC IMPERIALISM. The idea was this: economic analysis was being applied to everything and it was going to displace nearly all other approaches to social behavior. But that didn’t happen. Here’s my scorecard:

• There is internal colonialism in economics. Economists are now doing work on all kinds of issues.
• Partial conquest of political science/public policy. I think they’ve got an East/West Germany thing happening. They even had a perestroika movement.
• Economists conquered a small, but important, island in the legal academy. See Posner & co. But law & econ isn’t even close to being the modal form of legal analysis.
• In sociology, they won some ground, but now RCT is almost extinct, in the sense that there are no new people being trained in it. Not even at Chicago!
• History is completely unaffected.
• Psychology is unaffected and they even think the neo-classical choice model is bizarre and primitive.*
• Anthropologists never got the message.
• In the professional fields (education, health, business), economists have their own fiefdom but haven’t won converts.

So the way I see it, economic imperialism was mainly an internal discussion among economists about the meaning of their field. The new definition of economics was adopted by a notable faction of people in politics/policy/law that needed the aura of scientific rigor. The rest of the social sciences are happy to have “the economics of …” be a specialty in their field. But most of the people in that specialty are trained in econ programs. “Native” scholars in professional schools usually don’t rush into RCT models of their topics.

I have two hypotheses. First, there is math. Basically, you lose about half the audience whenever you use math. Some people are just allergic to math. But that doesn’t explain all of it. People are willing to learn statistics and some types of models have, periodically, gained prominence. My second hypothesis is that you lose people when you engage in formalization for formalization’s sake. In other word, if you tell social scientists that a simple model X captures an important social process, I think you will win followers. You lose people when academic research becomes an exercise in proving model X in the most general case, or in pursuing refinements. Finally, as was noted in our discussion of b-schools and economics, human behavior is about more than just decisions and social science can’t be reduced to cost-benefit trade-offs, even though it is extremely important.

50+ chapters of grad skool advice goodness: From Black Power/Grad Skool Rulz

* Sorry, behavioral is a very limited incorporation of psychology into econ.