“There is only one social science, and we are its representatives.”
George Stigler
dr hab. Bartosz Scheuer
prof. WUEB
expert of the Wroclaw University of Economics and Business
1. what does economics do? The question is poorly asked.
In common parlance, economics is a science that deals with issues related to the economy: the market, prices, money, production, sales, transactions, economic growth, inflation, unemployment, etc.
In other words, it is assumed that economics has its own subject field, that is, that it analyzes a particular area of reality, and this in turn means that it is also possible to identify issues that do not belong to this subject field and are the subject of consideration carried out within the framework of other sciences (for example, fertility and demographic change belong, as it were, naturally to the field of study of demography, the functioning of social groups and entire societies and the problems associated with this, such as crime or racial discrimination, to sociology, etc.).
Meanwhile, it turns out that the situation in this regard is quite different, because economics, or at least the part of it called microeconomics, is nowadays dealing with issues that in no way in the colloquial view of the matter are associated with this science. For we have the economics of crime, reproduction, religion, discrimination, social interaction, marriage, suicide, politics and even economics itself. In short, simply put, economics deals with (or could potentially deal with, if economists haven’t done so by now) everything we can think of. One could even say that we are basically dealing with the economy of everything.
2. not what, but how does economics deal with?
But what makes this possible, and how is economics entering areas that, at least traditionally, have been associated with other sciences? Well, first of all, from At least 60 years, we can talk about the occurrence of the phenomenon of the so-called “so-called” “”new”. economic imperialism, which involves taking over the research areas of other social sciences, and which is done not on the basis of economists conducting interdisciplinary research, but amounts to applying the methods and concepts of economics itself to the study of a given area as if it were a strictly economic phenomenon. Thus, economists do not collaborate with representatives of other sciences, but simply enter their research area and do it “their way.” In turn, they do so because, according to the famous definition of economics, formulated in 1932 by L. Robbins and proclaiming that it is the science of making choices, simply put, there is no reason to delineate its specific area of analysis in any way. To put it another way: economics is not defined by defining its research field, but by pointing to its approach and method. Whatever, therefore, can be described (in fact, anything can be) as making choices, this becomes or can become the focus of economics. Secondly, unlike other sciences, economists consistently, when subjecting successive issues to analysis, apply without exception a combination of three, simple assumptions (this is what we call the economic approach) and create on this basis a more or less abstract model (and this constitutes the method) of a given situation.
These assumptions are, as defined by Gary Becker, perhaps the most famous proponent of the idea of economic imperialism and winner of the Sakharov Prize. Nobel Prize in 1992: subject rationality and maximizing behavior, market equilibrium and the existence of prices or quasi-prices, and preference constancy.
3 Conclusion, or where we meet economists
What are the effects of this treatment of the issue and how does it look in the so-called “case”. research practice? For example, if one were to ask an economist about the problem of crime, he or she would answer that it should be assumed that criminals act exactly like any other person, that is, they rationally calculate the balance of benefits and costs, they do what they do for the same purpose as others (they have the same and unchanging preferences – they want to be happier, richer, etc.) and we can model the whole situation as if there were a crime market, where the action of the actors is determined by prices (on the same principle as we have a supply of hairdressing services, we also have a crime offer). So when we want to make crime less, it turns out to be a very bad idea to try to influence criminals so that they change their goals, while the right thing to do is to act in such a way that will change their balance sheet, and this can be done if only by raising the quasi-price of crime. Similarly, if one were to make fertility the topic of analysis, an economist would explain having offspring using the categories of demand and supply (and therefore market) of children and the factors affecting both. Then it will turn out that (as the aforementioned G. Becker did) it will be sufficient to explain the decision to have this and not that number of offspring by treating children as consumer durables (i.e., goods such as houses, dogs and cars) and assuming that the demand for them is determined by the same things that are also relevant for these other goods, namely quality, price and household income, and production technology.
Sound strange? Yes, even shockingly. Nonetheless, it is not on this basis that we judge scientific theories, because they are about explaining and, perhaps most importantly, formulating predictions. And here it turns out that these theories simply work: the solutions introduced as a result of the analyses made by the economics of crime resulted in a decrease in the number of crimes, and the low fertility rate after World War II was explained by economists better than demographers did.
