(Roughly) Daily

This is probably the most exciting and fruitful time ever to become an aspiring economist. Why? Because economics is reaching its Copernican Moment – the moment when it is finally becoming clear that the current ways of thinking about economic behavior are inadequate and a new way of thinking enables us to make much better sense of our world. It is a moment fraught with danger, because those in power still adhere to the traditional conventional wisdom and heresy is suppressed…

We are gradually reaching the same sort of stunning realization that Copernicus must have reached before writing his revolutionary book “On the Revolutions of the Celestial Spheres”: What if we can’t get there from here? What if incremental fixes don’t permit a major new leap in our understanding? What if we need to encounter the world afresh?

Fortunately, we now have access to a powerful body of thought that can guide this new encounter. The evolution of our natural world can be understood in terms of variation, replication and selection. The evolution of ideas can be understood in such terms as well: new ideas keep cropping up; they are transmitted from person to person; and the ideas that get selected to survive are often to be ones that enable us to navigate our environment most effectively. Selection can act not only on individuals, but also on groups. “Selfishness beats altruism within groups. Altruistic groups beat selfish groups. Everything else is commentary.”(E.O. Wilson and D.S. Wilson (2007), “Rethinking the Theoretical Foundations of Sociobiology,” Quarterly Review of Biology, 82(4), 327-348) The level of functional organization thus depends on the relative strength of within- and between-group selection.

This is a different starting point from the one underlying mainstream economics. The discipline of economics is based on classical physics, i.e. the inanimate world. Evolution, by contrast, is appropriate to the animate world. Not a bad point of departure for economics. After all, humans are living creatures. If we choose this path, economics will be reaching its Darwinian – not Copernican – Moment…

There is change in the air. Dennis Snower (@DJSnower) explains why “Economics Nears a New Paradigm.”

For a cautionary reminder that while this time might be different, we’ve started down this road before, see Kwame Anthony Appiah‘s piece on Thorstein Veblen, “The Prophet of Maximum Productivity.”

And for an oddly resonant, but different challenge to economic orthodoxy, see Ethereum founder Vitalik Buterin‘s recent “Endnotes on 2020: Crypto and Beyond.”

* economist and co-founder of General Systems Theory Kenneth Boulding

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As we recalibrate, we might recall that it was on this date in 1941, in his State of the Union Address, the president Franklin D. Roosevelt outlined the Four Freedoms— the fundamental values of democracy: freedom of speech, freedom of worship, freedom from want, freedom from fear. These precepts were furthered by Eleanor Roosevelt, who incorporated them into the Preamble to the United Nations Universal Declaration of Human Rights.

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