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Should Economists be Worldly Philosophers?

Md Masud Karim

In their somber and timely article “Economists as Worldly Philosophers”, which was published in the American Economic Review, Robert J.Shiller, Professor of Economics at Yale University, and his wife Virginia M. Shiller attempt to not only analyze the reasons for economists failure to preserve their prestige as worldly philosophers but also propose way out to regain the lost image. They argue that economists lost moral perspective as they were engrossed in marginal research. In their opinion, economists have to work on broader perspectives. This requires mathematical and technical skills as well as sound knowledge in human behavior, which means understanding in wider social sciences. Moreover, incentives and patronization should be offered to young economists, both in their training and subsequent profession, to promote wide-ranging research.

I completely agree with the Shillers’ view that building a proper economic model requires not only quantitative skills but also acquaintance in social science. To substantiate their argument, the authors remind us that human behavior is by nature ever changing; so, inclination to prove economics as pure science that is dependent only on mathematical model is fundamentally false. It seems plausible that as contemporary economists have overemphasized specialization while neglecting human economic behavior, they have failed to foresee the current financial turmoil. They also write that early successful economists namely Adam Smith and Keynes had familiarity in social science and human economic behavior was central of their prescribed economic theories.