Schumpeter’s meme, that economy is about creative destruction should suggest that math, which requires stability of the variables in order to be applied, won’t work.
Mainstream economics, neoclassical – wants to treat the world in some form of A=kB, where k is some constant and A and B are variable in an unrealistic world where ceteris paribus, everything else is equal. But players in the economy are trying to innovate: taste, technology and product, managerial style, and use war as a last resort. As a result A and B are anything but stable in their role as major independent and dependent variables. In much of economics what looks like A or B has to be replaced by variables that are actually determinant at any one time, but not in the next.
The result is that mathematizing the economy, a slow process anyway, does not fit a dynamics of open systems with constantly new variables. What is needed is the ability to tell meaningful stories about what is happening, which means narrative, characters, social shifts, complexity. The major economists: Smith, Marshal, Mill, Keynes, among many others, have all argued that the use of math is not quite legitimate and gives a distorted view of the unfolding facts.
But we have a further problem. For whom is the current neoclassical done? Not only are most economic papers not widely read, they are not widely read by economists. What then is their purpose? I think it is clear that the publishing mafia that controls the main journals is interested in a regime of methodology and publishing that makes economics look substantial, delivering prestige while supporting the 1% that wants to believe that the economy is ok if we just fix a few glitches. Economics is also, in its neoclassical/mainstream form, an aid to career alignment and departmental management of hiring and tenure.
The serious problem is, what would the content and education of a narrative focused economics look like?
Dani Rodrik writes in Project Syndicate
What’s Been Stopping the Left?
Apr 10, 2018 DANI RODRIK
If progressive political parties had pursued a bolder agenda in the face of widening inequality and deepening economic anxiety, perhaps the rise of right-wing, nativist political movements might have been averted. So why didn’t they?
Yet the lesson of recent studies is that beliefs about what the government can and should do are not immutable. They are susceptible to persuasion, experience, and changing circumstances. This is as true for elites as it is for non-elites. But a progressive left that is able to stand up to nativist politics will have to deliver a good story, in addition to good policies.