Transcript Rhetoric and Economics”

“Rhetoric and Economics”
Stuart Birks
Massey University
1
What is rhetoric?
• Logic  proof
• Rhetoric  persuasion
• Adam Smith:
– Deliberative eloquence (policy)
– Judicial eloquence (law)
2
People are persuaded by:
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Simple points
Humour
Analogy
Appeals to authority
Appeals to emotion
…
3
Why worry about rhetoric?
• Rhetoric dominates over logic
• Perception dominates over reality
• Image dominates over substance
4
Mainstream economic theory
• Based on:
– Rational individuals
– Exogenous preferences
• Relevant where rhetoric is important?
• Also, rhetoric in economics!!!
– McCloskey, Klamer
5
Three types of error:
Theory
B
Empirical
Analysis
A
C
Real world
6
Types of error, assume:
• Type A, theory applies to real world
• Type B, data and functional forms OK
• Type C, policy implications from statistics
– “Fallacy of the transposed conditional”
– Policy evaluation questions
7
Type A:
• Greenspan – “an ideology is a conceptual
framework”
• Harrod, 1938, when applied:
“From being one of the most exact, albeit
narrowly circumscribed, sciences, economics of
necessity becomes one of the most conjectural.”
• Theory as analogy / metaphor / frame
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