Methodology and Social Economics for the 21st Century
Friday, Jan. 3, 2020 8:00 AM - 10:00 AM (PDT)
- Chair: Wilfred Dolfsma, Wageningen University & Research
Simulation and Economic Methodology
AbstractMethodology should reflect on and assess real practices of research, not ideal ones. A practice consists of people working with ideas, tools, and techniques to tackle a specific set of problems. This means that besides the more traditional focus on ideas, we also must reflect on these tools and techniques. In current practices, the presence of computers is prominent and necessary and increasingly essential. This even becomes more acute when the computer is becoming more and more a tool of exploration, gradually replacing physical experimentation. In other words, if simulation is becoming the dominant research practice in economics, economic methodologists should pay attention to this.
These developments in economic research will change economic methodology. In particular, it will change our conception of explanation and its assessment. Hempel’s nomological-deductive model of explanation will lose this role of being a model for explanation in economics because its two constituent elements (laws and deductive logic) are too narrow to capture explanations based on simulations. This latter kind of explanations are answers to what-if questions, and not so much the covering-law explanations, which are answers to why questions. Simulations do not have to be based on realistic models and do not have to be analytically tractable to be rigorous explanations. We only must agree on new rules: rules of construction and rules of validation. This chapter suggests that the first are Turing machines and the second are Turing tests.
Energy Injustice: A Problem of Socio-Economic Stratification
AbstractExtensive market-oriented structural change in energy sectors around world, over the last 30 years, has generated systemic and widespread inequities (e.g. energy unaffordability, unequal energy access, energy poverty) across the energy continuum from production and distribution to consumption and regulation. This paper explores whether energy injustice is a particular and significant manifestation of broader socio-economic forces that discriminate against certain groups, and if energy injustice can be conceptualised as an issue of stratification. Darity (2005: 144) contends that stratification economics can illuminate “the structural and intentional processes generating hierarchy and, correspondingly, income and wealth inequality between ascriptively distinguished groups”. Davis (2019) imaginatively invokes the standard economics’ taxonomy of goods as a heuristic to demonstrate that many economic entities are effectively club goods, where consumption is excludable, but for club members non-rivalrous. Following Darity (2005), we argue that stratification thinking, as part of a social economics approach, challenges the mainstream refrain that competitive markets, such as those sought as part of energy sector restructuring, will address discrimination and inequalities. Extending this work, and drawing on Davis (2019), we argue that marketization has resulted in the increasing exclusivity of energy as a good such that it now reinforces and produces broader socio-economic forces that act to discriminate against certain groups.
Individuals’ Impaired Capability Development: Stigmatization and Social Stratification
AbstractI represent the personal identities of individuals as stocks of capabilities/freedoms, and argue that stigmatization of their social identities generates capability ‘devaluations’ and that social stratification by social identity generates capability ‘deficits’ – a double capability shortfall and reduction in people’s freedoms that diminishes them as individuals. At the micro level, stigmatization promotes certain social identities and demotes others in ways that reproduce social identity-based social-economic hierarchy, as argued in Davis (2015). To model the effects of stigmatization in employer-employee relational settings, given the recent evidence for 1989-2015 for the U.S. from Chetty et al. (2018), I describe how it can work to favor Black women, whose intergenerational income mobility has not worsened relative to White women, though overall Black intergenerational income mobility has worsened relative to White intergenerational income mobility. At the macro level, I show how social stratification, as investigated in Stratification Economics (Darity et al, 2018), functions as an economics of exclusion that sorts people by social identity across employment, housing, and the economy’s more and less productive sectors, à la Buchanan’s (1965) club goods taxonomy representation (Davis, 2019). These micro level and macro level processes are then argued to interact and work together to produce double devaluation-deficit effect on people’s capability development that reduces their freedoms and negatively impact their personal identities, while reproducing the existing social identity economic hierarchy.
History, Methodology and Identity for a 21st Century Social Economics
- B4 - Economic Methodology
- B5 - Current Heterodox Approaches