Thursday, October 10, 2013

Criticism Easier than Construction: Readng Steve Keen's "Debunking Economics"

I had been meaning to take a look at this book earlier, as the premise sounded interesting, and Keen is an interesting fellow on the blogs and twitter, but the price for a paperback was prohibitive.  I put in for my library system to pull it, and I was excited to get it and read it.
However, my main piece of advice is this: If you’re interested in the book, buy it if you can.  I say that because reading it, there were so many points I just wanted to grab a pen or  a highlighter and make a note, because in the highest praise, this book engaged me and made me think.

In the book, Keen starts at the foundations of microeconomics and shows why the assumptions that the standard is built on are false, and thus the whole of the standard model is untrue.  He does a good enough job and I can remember no major holes so I have to say he did a good job.  He did well enough that I caught myself paging through my micro textbook making notes to myself like “THAT’s a convenient fiction” so I can tell he made it in my head.   He does draw the outlines of a potential new sort of economics, based on Minsky’s Financial Instability Hypothesis, but he keeps enticing the reader with a new book that so far does not exist.  That’s the book I want to read.  For me, my favorite parts of the book are the normative “What is to be done?” section that usually only takes up the last five percent of a critical text.  Here Keen just entices….or kicks the can, criticism being easier than construction. 

Unfortunately, he is attacking both the citadel and the windmill of orthodox economics, so he will be largely ignored by the professorial class. (This is one of the threads running through the text, Keen’s outsider status in spite of having his neoclassics down cold.)  As a  heterodox economist, he can take liberties like actually looking at what Marx and Keynes said.  Though as a Marxist, I was both glad he takes my totem seriously for analysis, but was made sad when he took the threads of Marx’s work and tried to pull them apart and throw out what he doesn’t like, such as the Labor Theory of Value, and keep what he wants.  You can’t disrupt the canon, Professor Keen.

But I digress.  What he does do is explain the basics that he wants to pull apart of the neoclassical edifice so well that you could extract it and make it part of a textbook if you throw some sort of trendy technological interface in there and have questions…and charts.  The major flaw to me is the lack of charts in the book.  I think graphically, and there are so few charts in here that I had to translate the verbiage into charts in my head, and there’s no telling how close what he said corresponds to what I saw in there.  If I understand right, they are accessible online, but that’s a huge disruption in my reading style.
And finally, it is not an easy book to read.  The professor acknowledges this at multiple places in the text, to a point where his self-deprecating asides takes away a bit from the overall authority that he speaks with on the topic.   

Overall, this is a very strong book that I feel any student of economics would be bettered by reading.  He or she just needs to do one thing: actually buy it so the copy is yours.