New Economics Romantic Economics Richard Bronk

An original and more revolutionary than it gives itself credit for critique of the standard neo-classical economics, this volume draws inspiration from the thinkers and writers of Romanticism in order to improve the breadth, depth and validity of economic theorising. Breathtakingly erudite and remarkably clear in its argument, it’s certainly not for everybody, but a must for all policy practitioners, highly recommended for economists and worth checking out for anybody interested in social sciences.*

Economics truly is the dismal science, not so much because of depressing diagnoses it provides, but because it pretends to be something that it isn’t.

It deals with very complex social systems and yet it attempts to reduce them to a level that allows for precise mathematical modelling and numerically accurate predictions. There is no social science more rationalist than economics, but in its attempts to be a positive science capable of numerical predictions economics engages in simplifications bordering on the absurd and often fails to produce predictions even remotely applicable to real systems.

Economists choose precise mathematical models that in the real world predict almost nothing in preference to softer predictions (of the type most biologists, psychologists and sociologists are satisfied with) that would actually correspond to the behaviours of real marketplaces.

In order to achieve that type of precise modelling, traditional economics assumes that everything bar the perfectly rational utility maximisation is a ‘noise’ that will overall cancel itself out: even more advanced modern theories which allow for information problems and contextual influences maintain the basic core model.

But real economic agents are not cold, rational utility maximisers. Firstly, because human motivations – even in the marketplace – are much more complex than that: behaviour is motivated by many incommensurable and often conflicting values irreducible to one scale of preferences. Secondly, because in the system that is dynamically changing in time, agents have no way of optimising the utility: precise predictions are impossible as the future is unknown and influenced by the choices made by the agents. There is no equilibrium.

The Romantic Economist strongly asserts that standard economics works on a metaphor system based on the 19th century physics and that it uses mathematical modelling without much thought devoted to its actual helpfulness beyond impressing fellow economists and giving the discipline a cargo-cult like veneer of ‘scientificality’.

Bronk’s book tries to address this problem, but it doesn’t suggests economics becomes as much of a real science as our current state of knowledge allows instead of a perfect but extremely limited abstract model. Instead, he suggest that economists look across the arts-science divide and enrich their outlooks and broaden perspectives by drawing from the well of Romantic thought.

Bronk’s book is a call to free economics from the pretence of being a hard science and embrace the economics-as-poetry model. He deconstructs economics in a post-modern manner as a system of metaphors, structuring the vision and analysis, and then draws inspiration from the thinkers and writers of Romanticism in order to provide solutions that would improve the breadth, depth and validity of economic theorising.

The first half of the book is devoted to a presentation of the the utilitarian sources of standard economics and the critiques of the standard model within the context of the two cultures schism between Romanticism and rationalism: from Bentham to Mill and Smith, Herder to Hazlitt; Bronk presents the history of conflicting ideas with a rarely encountered breadth of erudition.

The Romantic approach emphasises the role of creativity, imagination and emotion while being sceptical of scientific reason (or at least of what passed for scientific reason in the beginnings of the 19th century). The main Romantic ideas that, according to Bronk, would enrich the practice of modern economics are recognising the role of imagination along the calculating reasons; the use of holistic, organic models that deny the possibility of equilibrium; the importance of local, national and cultural context values and institutions; and the inherently incommensurable character of human preferences, values and thus motivations.

The second part of The Romantic Economist develops Romantic-inspired approaches to economics in theory and practice, drawing on both original Romantic theorists and modern applications that incorporate some of the core romantic ideas. From complexity theories to Varieties of Capitalism to extensive exploration of the role of imagination in dealing with uncertainty of the future, what Bronk proposes is less of the paradigm shift and more the acceptance of multiple paradigms or sets of metaphors, each of which might provide more fruitful and accurate way of exploring particular aspects of socio-economic reality.

The notion that rejecting the view of economic actors as rational utility maximisers somehow implies rejecting the rationalist view of scientific enquiry is perhaps the most contentious in The Romantic Economist – and a clear non-sequitur. The need to broaden the assumptions of the standard economics is pretty clear. But the suggestion of rejecting the rationalist method of scientific enquiry is much less obvious and might seem dangerously close to a typical post-modern cult-stud relativism which implies that there is no paradigm or approach that is clearly superior to others, and that all have a validity within their own frameworks.

In his solutions Bronk is, however, very careful to stay on the positive science side of the relativist controversy. He doesn’t really advocate wildly different, extremely subjectivist or phenomenological approaches, but rather suggests what is a modest broadening of economic perspective.

In the final analysis, anything that might wake up the economists to the utter inadequacy of their discipline is to be welcomed, whether it’s presented as a relativists deconstruction or adaptation of Romantic metaphors.

Bronk goes a long way by showing how the standard model offers only one, and a rather hopelessly limited way to frame and perceive the socio-economic reality, but he stops short of asking the fundamental ‘qui bono?’ question and maintains the vision of economics as an objective, value-free discipline.

Bronk’s critique concentrates on metaphors and paradigms: but what appears perhaps most clearly in his historical account of ‘the great divide’ is how obviously the theories of economics have been informed by vested interests and particular, practical agendas; how utterly ideological economics has always been.

Perhaps the greatest achievement of modern neo-classical model is to successfully present itself as an objective, value-free, scientific description of how things are rather than a set of ideologically motivated props for a particular way of organising human society.

Despite very vigorous protestations by the economists to the contrary (which Bronk seems to take at face value), moral value judgements – ideas about how society should be – have always informed economic theory, and, arguably, and maybe inevitably, always will.

If the reason for the persistence of the current neo-classical model is at least partly political and thus external to the science, there is not much hope for correction unless the political environment changes.

The Romantic Economist ambles along at a measured pace in a dignified style of a serious academic treatise. Bronk writes clearly and presents his arguments and supporting material in and orderly and somehow staid fashion. While this style confirms the theoretical respectability it doesn’t make for an exactly exhilarating read. Bronk’s content is very much polemical, but his delivery seems purposefully reserved.

Despite the effort required, The Romantic Economist is eminently accessible to the general educated reader and recommended to all interested in social and economic theory. All economists should read it and seriously consider Bronk’s propositions, while the rest of us can hope that economists and policy planners will take some of them on board.

400 pages
Publisher: Cambridge University Press February 2009
ISBN: 978-0521735155

This review has been originally written for The Book Bag.