The symbol-archetype distinction when discussing economic primitives

Note:  Edited for the raft of horrible typo’s in the post – my apologies.  Originally this wasn’t going to be a post but just turned into one.  I would use the excuse that my new keyboard doesn’t have key labels, but that wasn’t the reason for all of the typos!  Thanks to the heads up by a good samaritan.

One thing that was clear from my post about economic primitives (such as production functions) being archetypes was that my distinction between symbol and archetype in that context wasn’t clear.  I realised that even before the post went up.

At the base level, an archetype is a subset of symbols – it is a symbol that comes with some set of subjective meaning, whose meaning moves with the context and audience.  When I used the idea of symbol to start with (as opposed to archetype) this was to denote primitives which can be seen as objective.  This was a bit imprecise – as the term symbol includes both objective and subjective forms of symbology.

In my mind, the advantage of the economic method has been that we’ve left our primitives exposed for all to see.  The idea that these primitives, in a practical sense, are really archetypes economists call upon rather than objective symbols is an admission that we aren’t fully transparent.

And yet this isn’t really a criticism of the method – for people willing to put in the effort of learning about economic models they ARE very transparent.  However, economists have to communicate with a public and politicians who do not have the time or the patience to do this – and will still determine policy.

In order to make sure that the knowledge gleaned from economic science is taken in appropriately, we use the primitives of economics as archetypes to build a narrative – however, this raises the question of why people should believe our narrative rather than the other narratives they hear?  In order to do so, economists need to:

  1. Understand and frame the alternate narratives that exist,
  2. Use the archetypes that we’ve created to reframe the narrative,
  3. Convince the public why our narrative is preferable – both in terms of how our narrative captures the facts and nature of the issue, and where the other narrative has gaps (for me a key goal is to track back – and find the framework the narratives share, to expose the implicit assumptions that differ).

This is where rhetoric is important when communicating with non-economists – and where both applied and even some theoretic economics should differ from the idealised version of scientific economics.  This is not to undermine scientific economics – no it is to reinforce it by helping it to tighten its definitions and identify relevant variables and data in order to increase economic knowledge.  Science and rhetoric provide a complementary cycle.  [Note:  Yes I’ve been reading McCloskey, surprise surprise 😉 .  However, my focus is more on how we communicate with non-economists – outside of the oft overused appeal to authority]

  • I’m told Deirdre will be in town in November….

  • How is the new keyboard without labels?

    • Types like a dream, but if I misplace my fingers slightly I get confused 😛

  • MF

    Dear Matt
    I am very interested in some comments you have made in your article., I refer to this point: “In order to make sure that the knowledge gleaned from economic science
    is taken in appropriately, we use the primitives of economics as
    archetypes to build a narrative…”
    Archetypes are powerful constructs through which humans may build systems of operation and their experience; Hence, their movement in global economics may be an indication of the overall state of health of human consciousness.
    The ‘narrative’ of the Twin Towers of Manhattan, and their destruction at 9/11, one may view as a narrative of symbols and archetypes within the long term western economic mind; They symbolized the summit – the powerful symbols – of Western Wealth and its global economic delivery systems.

    Their psychological and archetypal destruction symolised, to me, the end of a narrative in Western Economics: Vast industries, for example, supply chains for the aircraft industry, were destroyed, many others paralysed; Indeed, we are still, 13 years later – with this blatant intrusion in our economic consciousness in the west dimmed to a distant memory – grappling with massive global economic problems, which may be drawn, in the larger scale of the overall state of human consciousness, to these failed – destroyed – symbols of global economics; One cannot ignore the vast psychological impact of this event in consciousness: A massive, direct intrusion in human awareness on an unprecedented scale, upon the archetypal symbols of economic wealth.
    Today we see huge international forces coming into play such as a) movements to create a new platform for an international currency – china and Russia seem to be the front runners of this new standard. b) we see unprecedented amounts money printed in the West; Indeed, it seems as if a “new” currency is evolving: printed wealth – that is to say, wealth measured in “currency” other than productivity and which is predicated upon the assumption that the – dwindling – taxpayer base will foot the bill c) the changing role of reserve banks all over the world; d) We, nevertheless, seem to blindly follow, the Keynesian model, upon which this “wealth” was predicated – as an archetype. e) Investment in structures that may empower the middle class, the engine that drives the economic health of every nation to advance – absent, decimated by printed wealth, an inflation still to come and the propping up of an artificial stock market.

    The Western world, indeed, the whole of the global economic world – seem to me to be ready for a new archetypal overhaul and its narrative. What in your view could the critical factors be that would form the ingredients of such new economic symbols?

    • Hi MF,

      The broad sociological implications of the archetypical forms people use to interpret daily life is beyond me – the area where economists look at this is when we talk about “signalling”, “rules of thumb” or “focal points”, or sometimes it is implied when you hear an economist talk about “state dependence”.

      My main point in this discussion is merely to say that, when economists build an argument, they need to think how their simplified exposition may be used by people – as that itself may be taken by individuals an archetypical relationship that holds. If we oversimplify a conditional result, it can then be misapplied by people in place – which can be harmful.

      A broader conception of this would, as you imply, consider the way terminology impacts upon the way individuals coordinate with regards to what they value – or at an even larger stretch what they value. However, these issues run into deep questions that I am unable to answer – how do we know what others value? When someone makes a choice I do not understand, is it because they are different, or because they are “wrong”? The way we answer these questions changes the very nature of the types of ways we believe we should function as a group of individuals.

      In many ways I think we are in an incredible place (specifically in countries such as New Zealand), but more open dialogue about trade-offs is necessary for us to move forward. I think Piketty was saying he only felt comfortable discussing the ideas he is discussing because the Cold War is over – and I suspect the economics discipline is going to be quite different, and hopefully more objective, due to that fact. In this way, the question of how we use language – and whether we are communicating information clearly to the public – is important.