Eric has a post up in which he criticises behavioural economics:
Behavioural economics usually leaves a bad taste in my mouth. Too much of it just feels like …it was done in the 50s and 60s.
Essentially, his problem with the field appears to be that its results are often used to rationalise paternalism. I don’t have time to respond in detail now but my first thoughts are:
- Don’t dismiss results just because you don’t like the potential implications or the messenger. That would be like me saying I don’t like the Coase theorem just because it’s constantly misused by libertarians.
- There is a big difference between disliking a result and disliking the conclusions that some people draw from it.
- Behavioural economics is a very young field so it’s not surprising that it feels like mainstream economics from fifty years ago. It hasn’t yet matured into a coherent framework, but we should encourage practitioners to move in that direction, rather than dismissing it for lack of maturity.
- The research in behavioural economics has, until recently, been spearheaded by psychologists so it isn’t necessarily tightly tied to the sort of framework economists use. That’s not a problem, it’s an opportunity for economists!
- The youth of the field and its present empirical focus mean that it often feels very piecemeal. At the very least, it certainly doesn’t have the monolithic feel of mainstream choice theory. It’s hard to say whether economists will be able to tie it all together into as satisfying a framework as standard choice theory, but the lack of an overarching theory doesn’t make it wrong. It may be that economists eventually just have to accept that their field is becoming more fragmented, which just reflects the difficulty of accurately describing human choices.
I’ll return to some of these themes over the course of the week as I have more time.