Poverty and economics

How important should the subject of poverty be within the discipline of economics? Some economists appear to think it is a very small issue compared to the magnificent mathematics of general equilibrium theory. Others believe that economics should fundamentally be about the sources of human well-being and misery, and that understanding poverty is absolutely fundamental for economics. How should we try to sort this out?

Among the contemporary economists who have given the greatest attention to poverty and deprivation, Amartya Sen and Jean Dreze are particularly outstanding. Their research on well-being, quality of life, and hunger set a standard for the point of view that says that life quality and deprivation need to be at the top of the list of economic research goals. Here I'm thinking of books like Inequality Reexamined, Poverty and Famines: An Essay on Entitlement and Deprivation, and Hunger and Public Action.

The neoclassical free market purists stand at the other end of the garden.  The economists of the Chicago School put primary emphasis on the beneficent effects of untrammeled market behavior, and they give little attention to the "market imperfections" that poverty and deprivation represent. (The word "poverty" does not occur in the index of John Van Overtveldt's good intellectual history of the Chicago School, The Chicago School: How the University of Chicago Assembled the Thinkers Who Revolutionized Economics and Business.) Poverty seems to be viewed as a normal and fair result of the workings of market institutions: some people make large contributions and earn high income, and others make small or zero contributions and earn low income.

The closing chapter of Milton Friedman's Capitalism and Freedom is entitled "The Alleviation of Poverty." Here Friedman admits that poverty is a problem, but conceives of only two solutions: private charity (which he agrees will not work in a large complex society) and direct transfers from tax revenues to payments to the poor (which is limited by the willingness of citizens to provide taxes for this purpose). The mechanism he prefers is a negative income tax: persons with incomes below a given threshold would receive payments determined by their income levels. "In this way, it would be possible to set a floor below which no man's net income (defined now to include the subsidy) could fall" (192).

What this analysis leaves out is any consideration of the economic mechanisms that produce poverty within an affluent society, and how institutions could be adjusted so that poverty and inequality tended to fall over time as a consequence of the normal workings of economic institutions. Take race in America, for example -- a set of institutions that many observers see as being crucial mechanisms in the production of urban poverty. Writing in 1962, Friedman argues that racial discrimination in employment is essentially impossible within a competitive market system (link). But we now understand the geography and social structuring of poverty much better. Racial segregation in housing has not disappeared; it has only worsened. Low-quality and ineffective schools are concentrated in low-income and racially segregated neighborhoods, so poor people have reduced educational opportunities. Access to jobs is also constrained by geography and educational opportunity. (Here is a recent post on the mechanisms of racial disparities; link). So it seems clear that our economy systematically reproduces poverty in inner cities rather than reducing it. And the situation of rural poverty is not substantially better.

This all has to do with the dynamics of income at the bottom end. But we have also seen persistent widening of income at the top end. American capitalism has produced ever-widening inequalities of income for at least the past forty years. Consider these two graphs of income by percentile provided by Lane Kenworthy:

(Source: Lane Kenworthy, Consider the Evidence blog (link))

So the idea that a properly functioning market economy will tend to reduce poverty and narrow the extremes of income inequality has been historically refuted -- at least in the case of American capitalism.

It is apparent that the ills of poverty are debilitating to the families who experience it; their quality of life is dramatically lower than it needs to be in an affluent society. So that is one reason for economists to give higher priority to the study of the mechanisms and structures that reproduce poverty in the United States. But there is a more systemic reason as well: if 15% of all Americans live in poverty (46 million people), and if 22% of children live in poor households (16 million children), this implies a huge drain on the productive capacity of the American economy. Education, health, and inclusion are important components of economic growth; and each of these is harmed by the persistence of poverty. So economists ought to be in the lead when it comes to placing a priority on poverty research.

We need to have a much more systematic understanding of the institutions and structures through which access to income and the necessities of life is created. And this implies that the mainstream might be well advised to take counsel from structuralist economists like Lance Taylor. Here is how Taylor describes the intellectual foundations of structuralist macroeconomics in Reconstructing Macroeconomics: Structuralist Proposals and Critiques of the Mainstream:

In the North Atlantic literature, structuralism's intellectual foundations lie within a complex described by labels such as [original, neo-, post-]-[Keynesian, Kaleckian, Ricardian, Marxian] which nonmainstream economists have adopted; numerous variants exist in developing countries as well. The fundamental assumption of all these schools is that an economy's institutions and distributional relationships across its productive sectors and social groups play essential roles in determining its macro behavior. (1)

This emphasis on study of the concrete institutions embodied in a given economy, and the distributive characteristics that these create, seems like a very good starting point for arriving at a better understanding of the economic foundations of poverty than we currently have.

Social structures and causal powers

The idea of a causal power has been appealing to the realist tradition within the philosophy of science, and especially so for the philosophy of social science. Proponents of this idea include Nancy Cartwright (Nature's Capacities and Their Measurements), Margaret Archer (Realist Social Theory: The Morphogenetic Approach), and Dave Elder-Vass (The Causal Power of Social Structures). Elder-Vass provides a succinct description of the tradition:

Bhaskar offers us an alternative way of understanding causality, a causal powers theory. This draws on a different, realist, tradition of thinking about cause, one that goes back at least as far as Aristotle, but one that has been less influential than the covering law model in twentieth-century social science. As [Ruth] Groff puts it, 'realists about causality think, contra Hume, that causal relations are relations of natural or metaphysical necessity, rather than of contingent sequence' -- and that this necessity arises from the nature of the objects involved in those causal relations (Groff 2008:2-3). (43)

Stephen Mumford and Rani Lill Anjum's Getting Causes from Powers is an important contribution to this debate. Here are several useful comments from Mumford's contribution to the The Oxford Handbook of Causation, "Causal Powers and Capacities":

Where it is most radical, the powers ontology proposes a major reconceptualization of causation. Hume, as traditionally interpreted, understood the world to consist of distinct and discrete, unconnected existences. If this is accepted, then the best that can be made of causation is that it is a contingent and external relation between such existences. The powers ontology accepts necessary connections in nature, in which the causal interactions of a thing, in virtue of its properties, can be essential to it. Instead of contingently related cause and effect, we have power and its manifestation, which remain distinct existences but with a necessary connection between.

One such tradition was based in Britain and came from the work of Rom Harré (1970; 2001, and with Madden 1973; 1975), which seems to have been an influence on Roy Bhaskar (1975) and Nancy Cartwright (1983; 1989; 1999). In Cartwright, the commitment is to capacities, which in her account differ from dispositions in that they ‘are not restricted to any single kind of manifestation ... [but] can behave very differently in different circumstances’. (1999: 59)

Putting the point simply, the assertion that an entity has a causal power comes down to a claim about the nature of the entity and the strong dispositional properties that this nature gives rise to. Sugar has the causal power to stimulate the taste of sweetness in typical human subjects; this power derives from the chemical structure of the sugar molecule and the micro-organization and functioning of taste receptor neurons. A magnet has a power to attract a piece of iron, in virtue of its microstructure. In each case we have identified a real feature of the entity, and this feature is a consequence of real properties of its microstructure.

This approach makes sense with regard to social structures and institutions as well. If paramilitary organizations have a propensity to create young adherents who are easily mobilized in support of fascist politics (as argued by Michael Mann in Fascists), then we can make reference to this causal power in our explanation of the rise of Italian fascism. University X's tenure system produces a teaching environment in which students get little attention from their faculty, as a consequence of the incentives and habits it cultivates in young faculty. This means something fairly straightforward: given the specific arrangements associated with this tenure system, the interactions that individuals have within this institution inculcates patterns of behavior that bring about the consequence. On this story, "producing a faculty climate that gives little priority to undergraduate students" is a causal power of this institutional arrangement. Change the internal arrangements and you get different causal properties.

In the case of the social world, however, the fundamental constituents of social powers are the constrained and developed actions of persons who act within the context of a given set of institutions and structures. Unlike the iron magnet, whose powers derive from identical iron atoms arranged in certain geometries, a tenure institution or a safety organization derives its properties from the structured actions of the individuals who compose it.

The rationale for asserting necessity in either the natural or the social realm -- the idea that the power is a real property of the thing -- is the theory of scientific realism: things actually have the causal powers we observe because they have an inner constitution that propels their interactions with other entities. So the causal relation is a kind of necessary relation, not just a brute fact about regularities. Metals conduct electricity because of the chemical-physical structure of the copper wire. And universities have the properties they possess because of the institutional arrangements they embody and the actions of individuals within those arrangements.

So the theory of causal powers doesn't have to presuppose an objectionable form of metaphysical essentialism. Instead, it can be a defensible framework for embodying the idea of causal realism: things have the causal properties and dispositions they have in virtue of their micro-composition.

Why is it useful to use the language of causal powers? Because we can encapsulate a large amount of the pertinent causal properties of an entity into a fairly simple set of expectations. If iron is magnetic (a causal power) we can derive a large number of expectations about its behavior in a variety of circumstances; and we can explain those circumstances based on the powers we have empirically or theoretically established. If a certain kind of regulatory organization is observed to have the causal power of "contributing to an abnormal number of accidents" -- then one part of an explanation of a particular accident may be the fact that it occurred within the scope of that kind of regulatory organization. (Charles Perrow offers an argument along these lines in Normal Accidents: Living with High-Risk Technologies.)

Friedman on racial discrimination

It is interesting to re-read Milton Friedman's Capitalism and Freedom some fifty years after its original publication. There are many aspects of the book that are likely to catch a contemporary reader's attention, but mine was drawn to Friedman's analysis of racial discrimination. In general, Friedman believes that capitalism is fundamentally good for promoting categorical equality.

It is a striking historical fact that the development of capitalism has been accompanied by a major reduction in the extent to which particular religious, racial, or social groups have operated under special handicaps in respect of their economic activities; have, as the saying goes, been discriminated against. (108)

More specifically, Friedman argues that racial discrimination in employment (and housing as well, it would seem) is essentially impossible within a market economy.

We have already seen how a free market separates economic efficiency from irrelevant characteristics. As noted in chapter i, the purchaser of bread does not know whether it was made from wheat grown by a white man or a Negro, by a Christian or a Jew. In consequence, the producer of wheat is in a position to use resources as effectively as he can, regardless of what the attitudes of the community may be toward the color, the religion, or other characteristics of the people he hires. (109)

So self interest on the part of employers will induce them to make hiring decisions that are category-blind: the most productive and least costly worker will be hired. A rational business or corporation has powerful incentives not to discriminate.

In fact, Friedman expresses skepticism about whether the concept of "discrimination" even makes sense within a market economy.

The man who exercises discrimination pays a price for doing so. He is, as it were, "buying" what he regards as a "product." It is hard to see that discrimination can have any meaning other than a "taste" of others that one does not share. We do not regard it as "discrimination" -- or at least not in the same invidious sense -- if an individual is willing to pay a higher price to listen to one singer than to another, although we do if he is willing to pay a higher price to have services rendered to him by a person of one color than by a person of another. The difference between the two cases is that in the one case we share the taste, and in the other we do not. (110)

It is hard to square these observations with the rigid segregation and discrimination that were taking place at the same time in the Jim Crow South. For that matter, the facts of racial discrimination in housing and employment that have characterized American society since emancipation were perfectly visible in Friedman's own city of Chicago in 1962. So all Friedman needed to do was to look around him on Chicago's South Side.

Friedman draws a logical conclusion from his set of assumptions about markets and discrimination: fair employment practices legislation is wrong. "Such legislation clearly involves interference with the freedom of individuals to enter into voluntary contracts with one another…. Thus it is directly an interference with freedom of the kind that we would object to in most other contexts" (111).

So taking steps through legislation to reduce the harmful effects of racial discrimination in hiring (and presumably in housing) is an illegitimate use of the force of government, according to Friedman. In fact, he compares efforts to do so to the Hitler Nuremberg laws (111).

These are stunning conclusions, now that we have lived through the Civil Rights movement and have seen the coercive practices that provided the architecture of the American racial system. What it suggests is that Friedman saw the social reality around him through the spectacles of an idealized form of pure market society, in which transactions occur between purely rational individuals and lead collectively to beneficent outcomes. But that was not the reality of the United States, then or now.

We don't need to assume that this particular economist was racist; one doesn't know. In fact, Friedman asserts the opposite:

I believe strongly that the color of a man's skin or the religion of his parents is, by itself, no reason to treat him differently; that a man should be judged by what he is and what he does and not by these external characteristics. I deplore what seem to me the prejudice and narrowness of outlook of those whose tastes differ from mine in this respect and I think the less of them for it. But in a society based on free discussion, the appropriate recourse is for me to seek to persuade them that their tastes are bad and that they should change their views and their behavior, not to use coercive power to enforce my tastes and my attitudes on others. (111)

(Is anti-racism just a "taste"?)

In fact, Friedman's views throughout this chapter illustrate a different deficiency.  His analysis of racial discrimination is a striking example of the ways in which adherence to a theory can blind a person to the patent social realities around him or her. And once we see the realities of how racial discrimination and coercion worked in America, it is incumbent upon us as a society to put aside our stylized theories and attack the problem.

Here are a few earlier posts on the Jim Crow system (link, link).

Youth studies

One of the smaller sub-fields within sociology is "youth studies." This strikes me as an intriguing area of research, and it seems as though the possible questions for inquiry here have only begun to be tapped. Youth issues have come up in earlier posts, including disaffected youth (link), engaged youth (link), and the problem of knowing how young people think (link).

To begin, why is the category of "youth" an interesting one? Youths are important because they eventually become adults and full participants in all aspects of social life. We would like to understand better what the forces are that influence the psychological and cultural development of young people. It also seems clear that young people of numerous countries embody a shifting set of styles, tastes, vocabularies, and values that are distinct from those of their elders. We would like to understand the pathways of influence through which these styles and values are proliferated. But the youth population is important in its own right. The social movements of Arab Spring were propelled by significant youth movements and activists. The civil rights movement and the anti-war movement on the United States each had major or even preponderant participation by mobilized youth. So the generation of people in their teens and twenties can have major political significance.

Who are the "youth" whom we want to better understand? Is youth a historically constructed category? "Youth" refers to people who are young adults, perhaps from the ages of 15 to 25. These people occupy an interesting position in the life cycle; they are not children, and they are not fully developed adults. Their personalities and characters are still malleable; they can further develop in one direction or another. One teenager latches on to his street pals and slides in the direction of petty crime; another gets very involved in her mosque and pursues higher education. Why are there such large differences within a given cohort? Some researchers use the concept of adolescence as a way of characterizing youth culture. "Youth" is the period of development of young people that falls between adolescence and adulthood. So the development experience is important to understand, and the characteristics of behavior that young people display are crucial.

What is "youth culture"? Marlis Buchmann is one of the contributors to current studies in this area, and his The Script of Life in Modern Society: Entry into Adulthood in a Changing World represents his thinking in an orderly way. He attempts to summarize the main theoretical ideas of the field in his survey article in the International Encyclopedia of the Social & Behavioral Sciences (link). Here is how Buchmann defines youth culture:

Youth culture refers to the cultural practice of members of this age group by which they express their identities and demonstrate their sense of belonging to a particular group of young people. The formation of youth culture thus implies boundary drawing. (16660)

Here Buchmann focuses on the forces that create one or more forms of youth culture and style, and he gives most weight to the approach taken by researchers at the Center for Contemporary Cultural Studies at the University of Birmingham, where youth culture is channelized by the class position of the young people who live it.

For the CCCS scholars, youth appeared to offer a special vantage point from which to consider the more general dislocation and fragmentation of the British working class as the structure of Britain’s system of production, labor force, income distribution, and lifestyles was transformed over the course of the post-World War II period. (16658)

This approach doesn't pay a lot of attention to what one might expect to be the most basic question: what are the pathways through which individual adolescents are formed and developed into one form of youth culture or another? What are the microfoundations of youth culture?

With regard to youth especially, cultural practices such as music, dancing, movies, visual arts (e.g., comics), particular sports (e.g., skateboarding), and fashion (e.g., clothing and hairstyles) are preferred means of expressing a distinct way of life that is recognized by others as a sign and signal of a particular identity and group membership. (16663)

According to the particular needs of social representation, young people may assemble and reassemble stylistic elements of various origins in ever new ways to form distinct styles of juvenile cultural practice. (16663)

Buchmann isn't very explicit when it comes to characterizing what a youth culture consists of. Is it a set of values -- anti-establishment, anarchist, anti-war, suspicious of adults? Is it an ensemble of tastes and styles -- punk rockers, skateboards, sideways caps? Is it a complex of motivations and behavioral traits?

One point that Buchmann emphasizes and that resonates with me is the idea that there is a proliferation of youth cultures, not a single or small number of class-defined cultures. There is a substantial element of path dependency in the evolution of a culture within a population, and youth cultures in a place and time evolve dynamically.

Buchmann also highlights the importance of generation or cohort in the formation of youth culture. The experiences of a particular generation of young people have a profound influence on the directions and characteristics of the cultures they create.

It is interesting to learn that James Coleman was one of the contributors to one strand of youth studies. His 1961 The Adolescent Society: The Social Life of the Teenager and its Impact on Education is an interesting treatment of the topics of development and culture. He takes age segregation created by compulsory schooling as a key determinant of the emergence of a separate youth culture in the modern world. 

I find this topic intriguing for two reasons. First, it sheds some light on the dynamic processes through which individuals and cohorts shape their identities. And second, it promises to shed light on important social topics, from disaffection to mobilization.

The street and the ring

Loïc Wacquant offers a fascinating piece of urban ethnography in Body & Soul: Notebooks of an Apprentice Boxer. It is his account of his three-year experience while a sociology graduate student at the University of Chicago of participating in the Woodlawn Boys and Girls Club, a boxing club for young men who are serious about the sport of boxing on the South Side of Chicago. Wacquant takes the "participant-observer" method seriously -- he trains for a Chicago Golden Gloves match, while developing intense relationships with the young black men who do their training at the club and the older experts like DeeDee who coach them. (Here is Wacquant's website; link.)

One thing that is interesting about the book is that it brings together two fairly separate subjects of sociological interest -- the social lives of underclass black men, and the "sociology of the body" that focuses on the ways in which skill, dexterity, and persistence interweave with the sport of boxing.  There is an alliance  in both topics with the thinking of Bourdieu.

Here is something of the project of understanding marginalized black Chicago through participation:

Could I grasp and explain social relations in the black ghetto based on my embeddedness in that particular location? My long-term immersion in that little boxing gym and my intensive participation in the exchanges it supported day-to-day have allowed me -- in my eyes at least, but the reader can judge for herself on the evidence -- to reconstruct root and branch my understanding of what a ghetto is in general, and my analysis of the structure and functioning of Chicago's black ghetto in post-Fordist and post-Keynesian America at the end of the twentieth century in particular, as well as to better discern what distinguishes this terra non grata from the neighborhoods of relegation of other advanced societies. (x-xi)

Here is how Wacquant thinks about the task of making sociological sense of the sport:

[A sociology of boxing] must instead grasp boxing through its least known and least spectacular side: the drab and obsessive routine of the gym workout, of the endless and thankless preparation, inseparably physical and moral, that preludes the all-too-brief appearances in the limelight, the minute and mundane rites of daily life in the gym that produce and reproduce the belief feeding this very peculiar corporeal, material, and symbolic economy that is the pugilistic world. (6)

And here is a bit of the sociology of the body that Wacquant offers -- the phenomenology of being a boxer in training.

To work on the bag is to craft a product, as you would on a lathe, with the crude tools that are gloved as weapon, shield, and target. Finding your distance, breathing, feinting (with your eyes, your shoulders, your hands, your feet), sliding one step to the side to let the bag swing by, catching it again on the fly with a left hook right to the midsection. Not too high and not too wide, so the move can't be seen coming. Double it up, to the head, with a short, sharp movement. Follow up with a straight right, taking care to turn the wrist over like a screwdriver in order to align your knuckles horizontally at the precise moment of impact. (237-238)

Wacquant finds that immersion in the fight club allowed entry into the social world of marginalized Chicago that is otherwise highly racialized: white observers do not cross easily into the world of marginalized black men.

Being the only white member in the club ... could have constituted a serious obstacle to my integration and thus amputated my capacity to penetrate the social world of the boxer, if not for the conjugated action of three compensating factors. First of all, the egalitarian ethos and pronounced color-blindness of pugilistic culture are such that everyone is fully accepted into it so long as he submits to the common discipline and "pays his dues" in the ring. Next, my French nationality granted me a sort of statutory exteriority with respect to the structures of relations of exploitation, contempt, misunderstanding, and mutual mistrust that oppose blacks and whites in America.... Finally, my total "surrender" to the exigencies of the field, and especially the fact that I regularly put the gloves on with them, earned me the esteem of my club-mates, as attested by the term of address "brother Louis" and the collection of affectionate nicknames they bestowed upon me over the months: "Busy Louis," my ring moniker, but also "Bad Dude," "The French Bomber," "The French Hammer" ..., and "The Black Frenchman." (10-11)

The gym is a haven for the young black men who work out there -- a place where the dangers and disorder of the surrounding neighborhood are kept at bay.

In this cutthroat neighborhood, where handguns and other weapons are commonplace and "everyone" -- according to DeeDee, the club's head trainer -- is walking around with a can of Mace in their pocket for self-defense, purse-snatchings, muggings, battery, homicides, and lesser crimes of all kinds are part of the everyday routine and create a climate of pervasive fear, if not terror, that undermines interpersonal relationships and distorts all the activities of daily life. (22)

Here is a bit of ethnographic description that captures one incident on one day in September, 1990:

Today Tony called the gym from the hospital. Two members of a rival gang shot him on the street not far from here, on the other side of Cottage Grove. Luckily he saw them coming and took off running, but a bullet pierced his calf. He hobbled behind an abandoned building, pulled out his own gun from his gym bag, and opened fire on his two attackers, forcing them to retreat. He says he'd better get out of the hospital real quick because they're probably out looking for him now. I ask DeeDee if they shot him in the leg as a warning. "Shiit, Louie.! They don' shoot to injure no leg, they shoot to kill you. If Tony don' have his gun with him and pull it, they'dave track him down an' kill him, yeah: he be dead now." (25)

This could be a scene in The Wire -- for example, an ambush planned by two of Avon's gang members but foiled by Omar:

Two things seem particularly noteworthy in reading Body and Soul. First, the experiences of the three years that Wacquant spent in the Woodlawn Boys and Girls Club clearly helped to develop his own knowledge of the social reality of marginalized Chicago. There is a world of difference between reading theoretical and empirical studies of urban life, and finding ways of seriously immersing oneself in an urban environment. Wacquant is a better urban sociologist and theorist for the experiences he describes here.

Second, it seems clear that some specific insights into daily life in marginalized black neighborhoods in Chicago emerge from this experience. The prevalence of violence on the street, the strategies people arrive at to avoid being victims of violence, the social distance that exists between 63rd Street and Michigan Avenue -- these are all valuable insights that contribute to a better sociological understanding of the city.

Expert knowledge

We often want the judgment of "experts" as we make important decisions in life, health, and business. But what exactly is an expert?

One aspect of the idea is the possession of a large fund of specialized knowledge. A civil engineer specializing in bridge design is an expert in part because he or she has mastered the mathematics and physics describing the mechanics of large physical systems, the chemistry and properties of various materials, and the best practices that currently exist for ensuring safety. So the expert can be relied upon to have command of the most up-to-date and scientific specialized knowledge about a topic area.

A second aspect of what we have in mind from an expert is a person who has had significant experience in acting and judging in a particular context (and who has refined his/her behavior according to the outcomes of those experiences). An experienced pilot has had the experience of landing an Airbus 330 at O'Hare Airport many times in many different weather conditions. As a result, he/she is ready to respond quickly to unusual wind conditions in a subsequent landing. Essentially this aspect of expertise comes down to trained behavioral skills and responses, permitting the expert to quickly adapt to somewhat unusual circumstances in the future. This is a combination of "muscle memory" and refined habit; it is the trained sensibility and physical awareness of an expert player.

Another aspect of expertise is refined sensibility and perception. This is more akin to the trained palette of a wine connoisseur -- a refined ability to discern the flavors and odors of a pinot noir that are perceived more generically by the occasional wine drinker. Here the idea is that there are aspects of the world around us that can only be perceived and discerned by a trained observer. Michael Polanyi describes this aspect of medical training in Personal Knowledge: Towards a Post-Critical Philosophy (link).

A skilled physician has elements of all three kinds of expertise: the background fund of knowledge of physiology and disease that comes from medical training, the body of experience from which he/she has learned to judge and act, and a refined sensitivity to the minor indicators of disease that a non-expert would likely overlook. A skilled physician can diagnose an illness in a patient based on a body of symptoms, and he/she can prescribe a course of treatment that is likely to lead to alleviation of the disease or its symptoms.

An experienced news reporter may have an unusual ability to "see" the story that underlies a few unusual activities by the city planning commission, and he/she may have a skilled ability to summarize the facts of a story in a logical and readable way. The former is a developed skill of reading a situation; the latter is a developed skill in presenting a sequence of statements in a logical way. Both of these abilities are skills the reporter has cultivated through prior experiences and the feedback that came from success and failure. Further, the reporter may be an expert concerning the facts of a story -- he/she may understand real estate law, the business of real estate development, and the forms of collusion that are common in major development projects.

The reason we seek out the advice of an expert in any of these senses when we are confronted with a high-stakes decision is that we think the expert has a better basis for understanding the problem we face and the options that are available to us, and a better basis for weighing the options. We think the expert can help us make the most reliable judgments and decisions in difficult cases. So appeal to an expert is a strategy for us to reach either knowledge or strategy that is better aligned with the world than our own intuitions and analysis would permit.

As we consider the role of experts in helping us reach personal and collective decisions, it is important to keep track of the epistemic warrant of various kinds of expert judgments. When we consider how best to respond to a nuclear power plant accident like Fukushima, we want nuclear engineers as experts who can advise the best short and medium-term remedies to the immediate hazards. But we might be more skeptical about the judgments of these same experts when it comes to assessing the long-term viability of nuclear power. The assumptions on the basis of which the expert offers the latter kind of judgment may actually be very shaky, whereas the knowledge of nuclear design and physics that is the basis of the former kind of judgment is very strong.

There is a place within the sociology of science and the sociology of technology systems for study of "expertise", and some sociologists like Marion Fourcade have turned their attention in this direction. Expertise can be viewed as a kind of social capital, on the basis of which the expert and those who employ his/her services are able to gain various kinds of advantages. Fourcade's Economists and Societies: Discipline and Profession in the United States, Britain, and France, 1890s to 1990s is not specifically focused on the social composition of expertise, but it offers a good example of how the question might be pursued.

(I've addressed some of these issues earlier under the rubric of skilled cooperation (link) and technical knowledge (link).)

Economic observations

Oskar Morgenstern was one of the founders of mathematical game theory, as co-author with John von Neumann in 1944 of Theory of Games and Economic Behavior. He was also the author in 1950 (revised in 1963) of a book that should be of substantial interest to philosophers of the social sciences. The book was called On Accuracy of Economic Observations, and it called into question the unreasonable level of confidence that economists had in economic statistics in the post-war period. Here is how Morgenstern described his goals in the first edition:

This study is the preliminary result of a prolonged concern with the properties of economic data. Most recently the problem of accuracy arose again in connection with an investigation into the structure of the American economy by means of input-output tables. These are arrangements of the sales and purchases of industries which show the interconnectedness of the entire economy. They are attempts to provide information Quesnay intended to give in the ancient "Tableau Economique"; they were first used by W. W. Leontief. (v)

He puts the central message of the book in these words in the preface to the second edition:

This book addresses itself to both the general reader and the professional economist. The former will see that decisions made in business and in public service are based on data that are known with much less certainty than generally assumed by the public or the government. The second will discover that even most widely accepted figures frequently have error components of unexpected magnitude, and consequently cast doubt on many currently accepted analyses in economics. (vii)

Morgenstern's analysis in this book is a very sober assessment of the challenges that confront the task of assembling national or regional economic statistics -- employment, production, prices, trade, and so on. In Part Two of the book he has separate chapters on trade, prices, mining, agriculture, employment, national income, and growth.

His perspective is a scientific one; he is fully supportive of the need to treat economic reality on the basis of empirical data. But he insists on the crucial importance of carefully reviewing the instruments through which our economic observations are made, and assessing the cumulative range of error that is created by those instruments. In other words, he constructs an applied epistemology to accompany economic observation: a detailed accounting of the scope and limits of accuracy in these observations.

Our problems begin, Morgenstern believes, with the fact that economic statistics are generally reported without any indication of error estimates. "Yet it ought to be clear a priori that most economic statistics should not be stated in the manner in which they are commonly reported, pretending an accuracy that may be completely out of reach and for the most part is not demanded.... It will be seen later that national income and consumers' spending power probably cannot be known now in part without an error of +/- 10 to 15 percent" (8).

Morgenstern specifically discusses ten major sources of error in the estimation of economic statistics:

1. Lack of designed experiments
2. Hiding of information, lies
3. The training of observers
4. Errors from questionnaires
5. Mass observations
6. Lack of definition and classification
7. Errors of instruments
8. The factor of time
9. Observations of unique phenomena
10. Interdependence and stability of errors

Morgenstern illustrates the effects of these kinds of factors on the degree of accuracy attainable in several areas of economic observation. Particularly interesting for contemporary concerns is his analysis of employment statistics (chapter XIII). Here he points out that there are conceptual issues that compound the effects of difficulties of measurement; for example, how do we define an "involuntary status of employment"? How do we handle "frictional" unemployment? But he notes as well that there are substantial political pressures on the unemployment numbers (216). Morgenstern then digs into the methodologies involved in the four major sources of employment statistics in the 1950s: Bureau of Labor Statistics, Bureau of the Census, Bureau of Employment Security, and the US Department of Agriculture. (It must be born in mind that this analysis describes the methods used in the 1950s, not contemporary methods.) Here is a description of the method used by the Census Bureau:

The data are based on a geographically stratified random sample of about 35,000 households. These households are randomly chosen from sampling cells which have themselves been chosen according to a multi-stage cluster sampling procedure involving the use of probabilities proportional to size, from over 300 geographical areas. The sample is taken in the middle of each month to maximize comparability with other monthly series. (219)

Each of the four bureaus mentioned here conduct their observations using somewhat different  methods; and each sometimes arrive at significantly different estimates. For example, for the year 1950 the Census estimate of non-agricultural employment was 52.3%; BLS found 45.2%; and BES found 34.3%. "The three counts of non-agricultural employment differ widely by four to eighteen million people [from 1946 to 1961]" (224). Each is a reasonable and justifiable estimate; but there are broad differences among them.

Here is an interesting hypothetical graph that Morgenstern introduces to demonstrate how sensitive some economic judgments are to variations within the error range of a given variable. The solid graph plots national income against time as observed by an official national data time series. The lightly shaded area represents the error range around this variable. And the dashed line represents a hypothetical graph of the movements of national income that is entirely consistent with the empirical information associated with the national estimate -- but leads to diametrically different conclusions about the timing of the business cycle.

None of this should be taken to imply that we shouldn't pay attention to economic statistics, or that there are not rigorous methods for attempting to measure these kinds of variables. Rather, Morgenstern's point is that all scientific observation involves complex instruments; and it is incumbent upon the researcher to carefully assess the sources and magnitude of possible errors in his or her observations. Further, economists and policy makers need to exercise appropriate humility in making use of economic statistics to support this policy reform or that; they need to recognize the possibility that the estimates and time series of statistical variables upon which they rely are significantly skewed and inaccurate.

I wonder whether contemporary econometricians would seriously disagree with Morgenstern's skepticism about claims of several decimal points of precision for variables like national income, growth, or employment. Is there a current-generation refutation of Morgenstern's concerns?

(G. William Skinner wrote a highly interesting article in 1987 about the problems inherent in population, tax, and production data for historical Sichuan; "Sichuan's Population in the Nineteenth Century: Lessons from Disaggregated Data" (link). His analysis includes some of the same sources of error and bias that Morgenstern identifies.)

(Ian Hacking's The Emergence of Probability: A Philosophical Study of Early Ideas about Probability, Induction and Statistical Inference is a very interesting treatment of the history of the development of the mathematics of social statistics.)

Eurasian Population Project

In the historical demography hall of fame there is but a single bust -- that of Thomas Malthus. (I'm joking -- there is no historical demography hall of fame.) Malthus is the theorist with the most enduring theories and hypotheses about population behavior across the world. Most central among his theories is a causal hypothesis about population change: different cultures embody significantly different mechanisms for adjusting population size to available resources. Malthus believed that Europe and Asia differed in exactly this way: the family norms of Western Europe controlled fertility according to the level of available resources, whereas the family norms of Asia controlled population size through excess mortality when resources were short. These were the preventive and positive checks that Malthus described in An Essay on the Principle of Population.

The most basic importance of the Eurasian Population Project is precisely its refutation of Malthus's core theory. (The Coursera offering described earlier in a post on "A New History for a New China" provides a good introduction to the EPP; link.) EPP scholars have demonstrated that there is no fundamental difference in the population dynamics of Europe and Asia, at least along the lines postulated by Malthus. The first set of findings of this group are presented in Life under Pressure: Mortality and Living Standards in Europe and Asia, 1700-1900 [2004]. 

[Our study] is an international comparison of short-term mortality responses at the microlevel in past times…, designed to improve our understanding of the individual and family demographic responses to social and economic pressure. Its hallmarks are geographic breadth, temporal depth, and detailed longitudinal data. It examines not just one people, but a variety of micro-populations in West Europe and East Asia; not just one period, but a period of 80 to 150 years, largely from the nineteenth century; not just one community but one hundred communities with 2.5 million longitudinally linked individual-level records; and not just mortality, the subject of this book, but in later volumes of this series, the entire range of demographic behavior, including reproduction, nuptially, and migration. (4)

In particular, there is evidence from sites across Asia that demonstrate a mortality responsiveness to changing economic circumstances that is highly similar to that found in Western European sites. And specifically on Malthus' view of Asian demographic behavior:

Contrary to the Malthusian claim that the positive check was more important in the East than in the West, we demonstrate that mortality responses at least to short-term economic pressure were just as great, indeed often greater, in the West as in the East. Contrary to the neo-Malthusian characterization of mortality as a function of ecology and human biology, we demonstrate the importance of human agency not just in the East, but in the West as well. (5)

There is a crucial methodological assumption that distinguishes the EPP approach from traditional historical demography. This has to do with its focus on communities rather than national populations. 

Our focus on comparison of communities, not countries, represents a new approach to social science history. While we generalize about certain aspects of human behavior, we do so within the cultural, economic, and historical contexts of specific communities, not at the national level. In contrast with the dominant thrust in academic research, we ignore contemporary nation-state boundaries and standard historical chronologies. Thus while our results illuminate the behavior of specific Belgian, Chinese, Italian, Japanese, and Swedish populations identified in map 1.1 from the early eighteenth to the early twentieth century, we draw from them implications for the demography not of specific countries, but of social and economic systems. This strategy of comparing individual contexts rather than countries avoids the problem of representativeness normally inherent in community studies. (7)

The research programme that holds together the numerous local projects encompassed by the Eurasian Population Project is innovative and important. It frames a significantly new way of designing research into large-scale social processes extended over a long period of time.

At the same time, it seems fair to ask whether the data currently available through the EPP is broad enough to achieve the group's ambitious goals. The studies of each site are very data-rich; but there is of necessity only a very limited number of sites that will receive this kind of intensive data collection and analysis. Let's assume that the effort results eventually in two dozen careful local inquiries from Sweden to Japan. This is only a minuscule selection of sites from the universe of possibilities. So what makes us think that the patterns and processes that are identified in these studies are actually more general features of the totality of demographic behavior?

The answer we give to this question seems to depend quite a bit on our background assumptions about social variation. How much variability is there across Scandinavia, North China, or Japan when it comes to social and political arrangements, marriage institutions, and economic institutions? If we think that most of the institutional arrangements show a lot of variation, then it is hard to justify the idea that one or two careful local studies will be good indicators of the more regional patterns. If, on the other hand, we think that the relevant institutional arrangements are substantially more widespread and stable, then the local studies are more likely to be reliable as indicators of larger regional patterns.

James Lee, Cameron Campbell, and Wang Feng conclude their essay on comparative mortality patterns with this nuanced statement that highlights both variation and universality:

In spite of the popularity of convergence theory, human society remains divergent, a product of specific historical processes. This divergence transcends national boundaries between the northeast Asian and northwest European communities, respectively, but persists between continental boundaries. The irony, of course, is that while the Eurasian Project is an initial step to produce a non-national history based on individual data, not aggregate data, written at the community level, not the country level, our preliminary efforts to produce a social scientific history for the twenty-first century have to some extent also reconfirmed the meta-geography of the nineteenth century. (130)

I believe this approach to historical demography is one of the genuinely important innovations in the historical social sciences in quite a long time. It represents a very different way of trying to gain access to the kinds of processes and mechanisms that have led to important social outcomes in the past two centuries. And it provides a different kind of "microscope" through which to interrogate the past, one that depends on substantially larger and more collaborative research efforts by scholars throughout the world while working with a substantially more localistic conception of where the action is to be found.

Nelson Goodman on psychology

Nelson Goodman is best known within philosophy as an iconoclast within the logical empiricist tradition. He published Fact, Fiction and Forecast in 1954, offering a "new riddle of induction." Goodman was deeply interested in the arts and he argued that artistic expression is on a par with other forms of assertion and representation -- for example, in Languages of Art (1968). And his 1978 book, Ways of Worldmaking, cast doubt on the empiricist project of extracting concepts directly from experience. So Goodman was an important voice within American analytic philosophy. But he had a significant influence on me during my graduate studies in the context of a very different set of problems -- the philosophy of psychology.

Goodman taught a course titled "Philosophical Problems in Psychology" at Harvard in 1971. The course contained material from the tradition of empiricist philosophy -- Locke and Berkeley -- as well as then-current research on cognition and representation by empirical psychologists. These included Jean Piaget, Jerome Bruner, T.G.R. Bower, Ray Birdwhistell, Paul Kolers, Michael Posner, and R. W. Sperry. Goodman was interested in how perception works -- according to the philosophers and according to the psychologists. The guiding concern was this: what is the nature and origin of the conceptual systems through which human beings make sense of the world around them? The course began with an examination of the theories of perception and representation offered by Locke and Berkeley, beginning with the empiricists' critique of innate ideas, and then proceeded to contemporary efforts to analyze the same processes in real human beings.

Some of the writings of Jean Piaget played a central role in the topics and discussions of this class, including The Construction Of Reality In The Child. Goodman was interested in Piaget's efforts to chronicle the development of the child's conceptual world -- the formations through which the child makes sense of sensorimotor experience at various ages.

Another noteworthy component of the course was an extensive discussion of Paul Kolers' work on motion perception eventually published in Aspects of Motion Perception (1972). (This research was published in 1971 as "Figural Change in Apparent Motion"; link.) The phenomenon that Kolers described was a flashing pair of images that oscillated between one geometrical figure and another. The images are stationary, but the visual impression is of a smoothly moving object that changes from one shape to the other. Goodman provided a detailed and perceptive analysis of the methods and assumptions that underlaid Kolers' treatment of the phenomenon.

One idea that is pervasive throughout many of Goodman's writings is the idea of conceptual relativism. This is the key contribution of Ways of Worldmaking. The idea comes up repeatedly in the 1971 course. Here is a paragraph taken from my notes from the course that captures a lot of Goodman's own views about conceptual schemes:

Experience is always organized in one way or another. Moreover, not all ways of organizing are equally good; some work much better than others, some may be ineffectual; others may lead to internal inconsistencies. When one proves unsatisfactory, this leads to a reorganization. But doesn't this require that there be a world out there to which our schemes conform? Yes and no; no because there is no unalterable way of looking at the world in which facts about the world are expressed; but yes, within any given system of organization there are true facts about the world to which other schemata must form. The important thing here is that there is no unique "structure of the world"…. Goodman calls his point of view "neutralism" or "conceptual pluralism". (11/9/1971)

What is most impressive about this course is the fact that Goodman paid close attention to current work in psychology and the cognitive sciences. Goodman followed a philosophical method in this course that I continue to admire -- the idea that philosophical reflections about an area of science can be valuable to the degree that they are closely connected to real research problems in that area of research. This approach leans against a primary focus on big issues -- is behaviorism correct? Are there mental entities? -- in favor of more specific questions within philosophical and psychological studies of perception.

What I now find most interesting about the design of this course is the underlying assumption that philosophers and empirical scientists can find common questions where their methodologies can fruitfully interact to shed greater light on the issues.  In this case, philosophers have a lot of questions about perception and conceptual schemes; and cognitive and developmental psychologists are doing experimental and theoretical work that sheds light on exactly these issues. Finding a common vocabulary is challenging for the two research traditions, but it seems clear that the collaboration can be highly fruitful.

(Here is an interesting collection that takes seriously some of Goodman's strictures on conceptual systems from the point of view of problems in the social sciences: Mary Douglas and David Hull, eds., How Classification Works: Nelson Goodman Among the Social Sciences.) Alessandro Giovannelli's article on Goodman in the Stanford Encyclopedia of Philosophy is excellent; link. Here is an extensive bibliography of Goodman's works; link.)