Page 60 - Global Political Economy_Understanding The International Economic Order

NEO CLASS ICAL C ONCEP T OF AN ECONO MY
Neoclassical economics constitutes a systematic examination of
economic affairs as they are defined by professional economists. Eco-
nomics is a discipline or profession into which its practitioners have
been thoroughly socialized. It is the most systematic and rigorous of
the social sciences and the necessary starting point for understanding
not only the economy but also many other aspects of society. How-
ever, economics is only that—a starting point; it is the beginning and
not the endof analysis. The systematic approach taken by neoclassi-
cal economics provides many advantages but also embodies certain
limitations. Social reality, despite the efforts of economic imperialists
andmany rational-choice analysts to persuade us to the contrary,
cannot be reducedsolely to the prices andquantities of economic
science.
Modern economics, like physics andthe other hardsciences and
unlike the other social sciences (with the possible exception of demog-
raphy and certain fields in psychology), had a founder or lawgiver
who, in effect, definedthe purposes, parameters, andmethodology of
the discipline. The role of the lawgiver in an academic discipline has
been well characterizedby Charles Gillispie in his portrayal of Galileo
Galilei who founded physics, the first science worthy of the name. As
Gillispie described his genius, Galileo earned recognition as the first
true physicist and founder of modern physics because he asked the
right questions, proposedanswers (hypotheses or theories), andcre-
atedan appropriate methodology (experimental techniques) with
2
which to test possible answers. In such other physical sciences as
chemistry andbiology, there are other creative geniuses who laidthe
foundations of their disciplines.
The foundations of a scientific discipline, or any academic disci-
pline for that matter, must contain several elements. Each discipline
requires a commonly accepteddefinition of the subject andgeneral
agreement on the questions that the members of the discipline must
attempt to answer. Another component is a generally preferredmeans
or methodology; the principal method of economics is methodologi-
cal individualism (the rational-actor method), which assumes that ra-
tional, self-centered individuals are the basic economic actors. Possi-
ble answers, hypotheses, andeventually theories (perhaps laws)
satisfy, at least for a time, the questions of interest to the discipline.
The questions, methods, andanswers evolve, accumulate, andare dis-
carded over time, through open competition among ideas. The win-

2
Charles Coulston Gillispie, The Edge of Objectivity: An Essay in the History of
Scientific Ideas (Princeton: Princeton University Press, 1960), 7.
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