Life without Virtue: Economists Rule. Review essay of Dani Rodrik’s Economics Rules

S M Amadae

Economic Issues Journal Articles, 2020, vol. 25, issue 2, 51-70

Abstract: This review essay of Economics Rules situates Dani Rodrik’s contribution with respect to the 2007–2008 global economic crisis. This financial meltdown, which the eurozone did not fully recover from before the Covid-19 pandemic, led to soul-searching among economists as well as a call for heterodox economic approaches. Yet, over the past decade, instead the economics profession has maintained its orthodoxy. Rodrik’s Economics Rules offers a critique of the economics profession that is castigating but mild. It calls for economists to use more and diverse models without becoming wedded to any single model or an overarching vision. Yet Rodrik ratifies many of the benchmark models standard to orthodox economics and provides little ground for a fundamental rethinking of the discipline. This essay analyses the conservatism underlying Rodrik’s approach, which upholds general equilibrium theory and rational expectations underlying the efficient market hypothesis. It argues that the economics discipline’s scope-creep to maintain its applicability to all human decision-making, and its acceptance of all-inclusive utility functions, crowds out moral sentiments and civic virtue. Thus. it argues that rather than urging economists simply to be more cautious in their application of models to address particular social concerns, instead economists must recognise their discipline’s inherent limitations.

Keywords: Economic models; general equilibrium; efficient market hypothesis; financial crisis; rational choice; Dani Rodrik; Kenneth J. Arrow; neoclassical economics; financial crisis; virtue; Eugene Fama; Alan Kirman (search for similar items in EconPapers)
JEL-codes: B E G (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.economicissues.org.uk/Files/2020/EI_Sept2020_amadae.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eis:articl:220amadae

Access Statistics for this article

More articles in Economic Issues Journal Articles from Economic Issues Contact information at EDIRC.
Bibliographic data for series maintained by Dan Wheatley ().