Heterodox Contribution of Sheila Dow - Essay Example

? On Heterodox Economist Sheila Dow: An Examination of Valuable Methodological and Philosophical Contributions [Insert Here] [Insert AffiliationHere] [Insert Any Correspondence Details Here] On heterodox economist Sheila Dow: An examination of valuable methodological and philosophical contributions [Insert Institutional Affiliation Here], 2011, 13 pages The heterodox economist, Sheila Dow, has made great contributions to the philosophy and methodology of economics. Her studies, which range from applied mathematics in the local providences of the United Kingdom, to theoretical and methodological studies relating to the philosophical foundation upon which economics as a field grows and develops, has contributed greatly to current directions and trends in an ever-evolving and shifting paradigm of thought. An examination of key contributions made by her research and related findings suggests that Dow has, additionally, played a pivotal role in the evolution of a new, more rigorous methodological approach to economics which dictates attention and respect for the emerging pluralistic notions which are omnipresent throughout the dual theories that comprise economic discourse and debate. Dow’s observations are, subsequently, as much descriptive as they are prescriptive toward the improvement and betterment of a study which maintains sociological relevance to the universal human condition. The following analysis shall highlight some of the key contributions made by Sheila Dow throughout the duration of the evolution of her thought on the topic of heterodox economics. Key Assumptions The evolution of Dow’s thoughts on economics begins with the formation and establishment of key assumptions concerning the human condition and its relation to the study of economics. As a heterodox economist, Dow is, first and foremost, very aware and interested in the orthodox theories which provide the foundation upon which newer, more innovative methodologies in the field of economics come to pass. However, Dow’s study of these theories has given rise to the formation of certain assumptions concerning the grander study of economics at large. First, it is shown that Dow understands all ontological theories to be ontological in nature, or, in layman’s terms, relating to the condition of one’s being or existence. This is, in part, because these theories all come from humans who maintain a certain awareness of their own existence and the relation that that condition plays to the outside world. Thus, Dow maintains that it is impossible for an economic theory to be objective because the very nature of a theory is value-based and therefore subjective (Dow, 2002). Dow states: “… economics is dealing with human beings who function within a social system” (p. 10). Therefore, it is difficult to presume that any single economic theory offers objectivity independent from the social system that gave birth to it. A second assumption which Dow comes to rely on in the formation of her further studies is that economics, as a study and, arguably (and at times) as a science, should be applied to real world scenarios. This assumption is built upon a general frustration with an economic ‘science’ whose diverging, pluralistic principles appear to adhere to an ‘anything goes’ methodology that starts with theory and ends with theory in a basic extrapolation of fantasy. She states: “We need to distinguish between a plurality of methodologies, or approaches, on the one hand and a methodology which advocates a plurality of methods on the other” (Dow, 2001a, p. 9). In this way Dow is advocating for a methodology which approaches the very real existence of pluralism within the field of economics with a meticulous and ordered strategy of applying alleged theories to the real world. Dow’s second assumption is, admittedly and, perhaps, necessarily, mitigated by the first in that the overly-meticulous methodology which would hold a theory or concept to a mathematical benchmark might fail to entirely encompass the truth behind the theory. Yet, Dow’s assumption of both the former and the latter standards give rise to compelling observations, arguments, and concerns regarding the future of economic studies. On Heterodox Economics Dow is commonly referred to as an heterodox Economist. Yet, this terminology may tell only part of the grander picture that is Dow. As an economist, Dow makes a concentrated effort throughout the duration of her studies to approach economics through both a descriptive and prescriptive approach as supported by the analysis of Crespo on her work: Economic Methodology: An Inquiry. Dow understands the study of economics to encompass observation, interpretation, deductive reasoning, and resulting prescription on the ways and means by which society might rectify economic problems or, at least, come to understand them better. Thus, a primary part of Dow’s work is descriptive; an observation of the world around her. Dow observes a world whose changing dynamics have given rise to vast pluralism throughout the science of economics. She states “Since economics is a social science, and particularly given the greater interface with sociology, it would not be surprising to find evidence of plurality also in economics” (Dow, 2006, p. 2). This thought process undoubtedly emanates from the original assumption that human ontology translates into human thought processes; thought processes which give rise to the very human theories that dictate paradigms within the school of economics. Dow understands the pluralism which runs rampant throughout economics to exist in the form of controversies; those conflicts that manifest between members of contending schools of thought in economics termed paradigms and which give rise to new and refined discussions on the meaning, reason, and application of economic concepts. She states Each paradigm is pursued by a community of economists who share foundations, in terms of understanding of reality, meaning of terms, methodological approach, and so on. There is considerable scope for controversy between paradigms in that each will approach similar programs quite differently. There is also much scope for talking at cross purposes, since the nature of the problem may be understood quite differently, similar methods may be part of very different methodologies, and similar terms may have very different meanings” (Dow, 2001, p. 6). Ultimately, the result of such varying and contending theories, paradigms, and schools of thought on economic concepts is very little common ground on which to study real world economic principles. While some economists reject inflation as a significant factor (and subsequently negate it from their methodological studies), others emphasize it disproportionately, and subsequently arrive at conclusions which deviate significantly from the former’s worldview and which only serve to further conflicts, divide, and stagnation toward the real world realization of learned economic knowledge. Structuring Pluralism Dow’s discoveries concerning increased pluralism within the field of economics gave rise to intense interest and debate concerning a methodological attempt at structuring it and subsequently optimizing results gained from respective considerations. Dow describes a growing ‘anything goes’ approach in which plurality in economics is rising proportionately with increased homogenization in methodology (Dow, 2006a). In other words, as methodology is loosened to encompass an ‘anything goes’ mentality that cuts across traditional, orthodox borders and methods, existent pluralism within economic community becomes more and more disoriented (and less and less applicable to real world scenarios). Dow subsequently implores her audience to observe and consider the benefits that will be derived from attempting a real and genuine structure to embody a vast degree of pluralism in economics. She states: It is concluded that it would be helpful (for our understanding of the current state of economics with its variety of approaches to theory and evidence, for communication between different approaches, and for future development in discipline) for the scope for both openness and constructive critique to be more widely discussed (Dow, 2006, p. 3). In this manner, Dow is placing certain limitations on the ‘anything goes’ approach to varying perspectives in the field of economics. On the other hand, an undertow of appreciation for consideration to pluralism is present. As a heterodox economist, Dow embraces the many theories as representations of worldviews emanating from ontological, living, breathing experiences and desires, which may be granted consideration in order to come closer to ‘the truth’. On Methodology The development and progression of Dow’s works converge on methodology. Working in the field, crunching numbers, examining results, and exploring related theories appear to lead Dow deeper and deeper into the nature of the methodologies employed by economists to reach the conclusions that they do. Not only do these methodologies give Dow clues into the ontological frameworks within which economists are working (and, subsequently, how paradigms are evolving), methodology appears to offer potential for a change which addresses many of Dow’s concerns. Dow wishes to convey a structured method of observing and accounting for varying points of view which might bring an economist closer to ‘the truth’. Yet, she recognizes a tendency in the economic community to employ an ‘anything goes’ approach which enables the economist to operate from his or her own, biased worldview to pick and choose the substantive theories which comprise his or her methodology. This, according to Dow’s conception of effective heterodox economics, is ineffective and, perhaps, misleading. In fact, as early as 1991, Dow began to marvel at the ill-informed baseline upon which entire economic schools of thought were forming. Her consideration of post modernism during a time in which economists were exploring its theorized applicability to the theory of economics (no real world application was necessarily being targeted) suggests that Dow’s appreciation and aw of the world’s many contending paradigms did not discount her awareness of the weakness of an argument with little or no calculated and identified methodology. She states: The notion of postmodernism may be useful as a way of understanding tendencies in particular brands of economics and also in methodological discussion, but it seems to have scarcely any applicability as an active approach within economics in its own right (Dow, 1991, p. 84). Dow stresses an imperative to employ a methodology which will account for theoretical backings, definitional understandings, and a general delineation of targeted observations and expectations. In other words, Dow wanted a method that would account for a variety of perspectives without discrediting or abandoning any of them in the process. On Application Though Dow’s heterodox musings might appear unorthodoxly dissociated from the functioning world of economics, she draws her readers’ and colleagues’ attention to a variety of instances in which converging methodologies are used to blend understandings of one paradigm with another. In ‘Post Keynesian monetary theory for an open economy’, Dow explores the growing juxtaposition of two vehemently opposed schools of economic thought: Keynesian theory and monetary theory. Dow explores (in brief) the differences in paradigms between Keynsian theorists, who consider traditional supply and demand forces with respect to governmental impositions on supply (money supply) and demand (reserve fluctuation of interest rates), and monetarist, who reject the overall ability or significance of a theory to account for changes in inflation (and interest rates) – instead focusing on the general money supply to further close the system. Dow observes that “In a global monetarist model, it was shown that, while changes in the exogenous money stock are the major source of economic instability, economic openness diminishes the scope for that instability” (Dow, 1986-87, p. 253). Thus, some convergence appears to occur between the two heavily juxtaposed schools of thought, calling, further, for consideration of the methodologies employed by economists to give rise to these findings. Dow finds that the monetary theory actually makes positive use of Keynesian methodology which, ultimately, does not negate the important differences between the two theories themselves. Experimental Implications Dow’s mini-experiment concerning her analytical exploration of the two contending theories gave way to a critical revelation: lending more credence to the principles, dynamics, and terminologies associated with a separate paradigm, allows another paradigm to grow and prosper. Pluralism in Education Perhaps the most important contribution made by Dow to the field of economics is her passion and attendance to the education which brings forth the most influential economists of all: theory. Dow’s many, many works are a heterodox of considerations for the many, many theories which give rise to the science of economics. Her assumption that economic theory is ontological spurs her on to discover the nuanced biases present within every layer of economic thought and, then, devise a plan to overcome that bias with consideration and understanding for as much of it as possible. Her assumption that economics is most beneficial when placed within real world scenarios is prime motivating factor in her decision to attempt to devise a plan to account for all or most existing forms of bias within economic theory to, in a sense, average these considerations to arrive at a product (or experimental result) that more closely resembles reality. Thus, Dow’s decision to embrace the many forms of pluralism existent within the world of economics contributed to her resolve to encourage pluralism in the education of emerging economists. In ‘Economic Methodology: An Inquiry”, Dow explores the functions of pluralism in economic education as it pertains to formulating a better, more accurate methodology. Though, in part, inconclusive, her working conclusion is that a methodology which informed on important concepts and principles in every component of a greater, pluralistic picture, will result in an economic product which might be better applied to the real world. Problems One compelling part of Dow’s legacy is her consistent consideration of opposing viewpoints in accord with her own methodology to consider and respond appropriately to pluralism. In ‘Formalism, Logic, and Reality: A Keynesian Analysis’, Dow (2001) explores the costs associated with approaching economics through a formal model. She states that The costs associated with the way in which formalizing an argument can change its meaning, i.e. with its non-neutrality… (p. 1). In this way, Dow considers early on the problem of bias in the very words and principles her methodology would approach. This thought pattern mirrors Keynes who is quoted by Dow (2001) stating “ The onus is on the economist to justify treating a particular context as a closed system when this can at best only be an approximation (p. 27). In fact, Keynes, himself, who is responsible for creating perhaps one of the most rigid paradigms of economic theory (and agents of orthodox debate) acknowledged an open economic system using his own ‘intuition and judgment to the fore’ (Dow, 2001, p. 27). Another problem consistently encountered by Dow as she explores and develops her work is the difficulty with she seems to have identifying positive criteria for reasoning in her methodology. While Dow is aware that structured consideration of pluralistic points of view is necessary in order to exact the benefits of all existing literature (and related perspectives) as well as anchor a theory to its field, she struggles with the many methods and means by which a methodology might be successfully conducted and reasoned. First, she considers traditional mathematical approaches to economics which apply numbers to existing theories to test their validity. Yet, she acknowledges a fatal flaw characteristic of this reasoning tool: the lack of real world spontaneity and ontological influence. She extrapolates upon this concept, considering the non-social nature of math and science and its subsequent dissociation with economics which, according to Dow, is as much a measure of the sociological state of the world as it is of the rapidity and degree to which money is flowing. Ultimately, Dow returns to pluralism and its related methodology to explain a philosophy of reasoning existing snuggly between science and humanity. Concluding Remarks Sheila Dow brought about a new era of heterodox economics. Her consideration of multiple methodological and philosophical factors facilitated her successful development and consolidation of a prescriptive solution to the ‘anything goes’ mindset of the twentieth century economist: structure. It is refreshing to read the works of Dow and envision a future of economics bright with possibilities, diversity, and, to some degree, unity. Her argument that the diversity of thoughts and pluralistic economic patterns can be conceived of through the lens of structure, science, reason, and intuition, speaks highly of the economists who must grapple with macroeconomic concepts that exist outside the realm of traditional and sometimes explainable science. Works Cited Chick, V. and Dow, S.C. (2001), ‘Formalism, Logic, and Reality: A Keynesian Analysis, Cambridge Journal of Economics, http://www.helsinki.fi/filosophia/inem/announce/dow.PDF. Crespo, R.F. ‘Philosophy, History, and methodology of Economics’, Economic Methodology: An Inquiry. 582-585. Dow, S.C. (1986-87), ‘Post Keynesian monetary theory for an open economy, Journal of post Keynesian Economics, IX (2), 237-257. http://www.flar.unesp.br/posesco/Dow(198687).pdf Dow, S.C. (1991), ‘Are there any signs of Postmodernism with Economics?’, Methodus, 81-84. Dow, S.C. (2001), ‘The Relevance of Controversies for Practice as Well as Teaching’, Post Autistic Economics Newsletter, 6, http://www.paecon.net/PAEtexts/Dow1.htm Dow, S.C. (2001a), ‘Modernism and Postmodernism A Dialectical Analysis”, Postmodernism, Economics and Knowledge, London: Routledge. Dow, S.C. (2002), ‘Economic Methodology: An Inquiry’, Oxford University Press. Dow, S.C. (2004), ‘Structured Pluralism’, Journal of Economic Methodology, 11, 275-90. Dow, S.C. (2006), ‘Variety of Methodological Approach in Economics’, http://dspacedev.stir.ac.uk/bitstream/1893/592/1/Variety in Economics 191006.pdf Dow, S.C. (2006a), ‘Plurality in economics’, http://www.scheme.org.uk/wps/SCEME011_Dow_2006.pdf “Sheila Dow”, Heterodox Economics Newsletter, 100. http://heterodoxnews.com/n/htn100.html Read More