Maurice Dobb published, in 1963, a book on Economic Development which neatly summarized the 'Sen-Dobb' theory and the ideology adopted by the Indian Planning Commission. It was based on a fanatical belief in Soviet and Maoist propaganda about the very peaceful and humane manner in which everybody had been enslaved so as to push up economic growth.
Dobb wrote
... there were two crucial bottlenecks confronting development on the eve of the First Five Year Plan.
In 1928, the big problem was how to take the land from the peasants while extracting much more out of the agricultural sector. It was solved using military methods and inflicting a big famine on them such that their spirit of rebellion was completely crushed. Between 3 and 7 million people died of hunger. Perhaps two or three million more were killed or died of exhaustion in Prison Camps.
Firstly, there was the marketed surplus of agriculture: the amount of foodstuffs and raw materials over and above the consumption of the peasant producers (with their families) that was placed on the market outside the village, and hence was available to feed a growing urban population of workers in industry and construction.
This was raised through confiscation. Peasant producers were welcome to starve to death. So were non-Peasants who weren't handing over what they produced. This was a Mafia or Conquistador State.
Secondly, as soon as the rate of construction was stepped-up, there proved to be a bottleneck of constructional and building materials, in particular iron and steel and fuel and power.
These could be taken away from building useful stuff to White Elephant Projects. The Soviets could sell raw materials to get massive 'technology transfer' but this was only because Stalin could kill any group of his own subjects who objected.
Obviously, new factories, steel mills, power plants and industrial towns cannot be built faster than cement and steel and bricks become available for their construction and fuel and power are available to drive the new machinery when it is installed.
Anything can be imported. Killing the natives and stealing their nice shiny stuff may be able to pay for imports- at least for a time.
It seems likely that both of these limiting factors will be operative at some stage in most developing countries; the former probably being dominant at the early stage of growth and the latter becoming dominant as industrialisation gets into its stride.
The limiting factor is whether you can kill off any group of people within a territory and take possession of its resources. Stalin and Mao could. India couldn't.
They will operate, that is, as effective limits upon the rate at which a country can develop out of its own resources.
No. There can be capital and other flows from outside. India was hoping to Industrialize using foreign aid. Another possibility is to permit foreign direct investment and encourage immigration of skilled workers and entrepreneurs.
What conclusions can be drawn from this for actual policy?
Don't consult a Cambridge Professor. Academics have shit for brains. Cambridge economists went in for 'closed economies' because then there is a fixed point such that stocks and flows can be brought into intersection (though they exist in separate spaces!). What was the big problem with having an open economy? I think, following Hicks, that focus is shifted to 'the merchant'- i.e. the realm of the 'Town' rather than the 'Gown'.
In particular, what implication does it have for the precepts of traditional theory? Expressed in general terms, the implication is that whatever investment-potential one has
can only be judged by people who are in the investment for profit business- i.e. 'merchants'. They either learn to spot 'investment potential' or go out of business. Similarly, if you in the film business and are looking for 'star-potential', hire a talent-scout with a proven track-record. If things are left to the market, a class of Agents or other intermediaries will arise so that potential is evaluated objectively. This makes it easier to finance investment projects. Borders need not matter if markets straddle them.
should be concentrated upon methods and lines of production which will increase this investment potential still further.
This is nonsense. No type of 'potential' is concentrated on what will increase that potential yet further. Speaking generally, 'potential' has to do with 'catch-up'. At the age of 10, I had the potential to be a mathematician. By the age of 16, I didn't. I hadn't 'caught up' with the smart kids. I had been lazy and would grow lazier yet.
With investment, the only thing which matters is the rate of return. Society did expend some money teaching me maths from 16 to 19 even though I had no potential to become a mathematician. Still, I could be a good enough Accountant or Financial Analyst. Thus the return on my education was quite high. True, the return on the mathematical education of Terence Tao was exponentially higher. But the cost increase was scalar. The problem is that potential Terence Taos are few and far between.
In so far as the limiting factor consists in the output-capacity of the industries which produce capital goods (machines and constructional materials), the possible growth-rate in the future will be higher the larger the proportion of current investment that is directed towards expanding this sector of industry (Marx’s Department I industries).
This simply isn't true. Capital goods can be imported. The best result is to specialize in some Capital goods and to export them while importing other Capital goods. It is what happens within a Nation, or even within an industrial District. Why stop the operation of the law of comparative advantage at the border of the Nation? True, if- like Stalin- you are worried your people will run away, then you may want to isolate your country. But you can still trade with other ghastly, tyrannical, shitholes.
This for the simple reason that one will have a larger output of steel and machines
both may be crap
in future years with which to construct and equip new factories and powerplants and steel-mills.
which will be crappier. A better strategy would be to identify Elephants with the potential to become albino. Concentrate all your resources on a breeding program for such elephants. True, lack of food may mean the elephants die off. Redesignate rabbits as elephants. Announce the over-fulfilment of the 5 Year. Soon, every collective farm will have a White Elephant of its own! First, of course, we must kill the Yids and the guys who look like they might be Yids and those other guys who aren't already killing Yids because they are bougie counter-revolutionary cunts.
I mention Dobb's book because Indians reading it understood that it was utter shit. Amartya Sen says- in an essay titled 'Hicks & Liberty'- that 1963 was the year he decided to quit Cambridge- i.e. give up on 'Capital theory' of the Dobb/Robinson/Sraffa type- and return to India to focus on the less mischievous but wholly fraudulent Social Choice theory that Arrow's stupid theorem had pioneered. Sen hoped that Hicks had written or would write something to put the subject on firm foundations. Sadly, this couldn't be done because there are no well ordered sets in that field.
When I resigned from my job in Cambridge in 1963 to go to Delhi University to teach, I wanted a firm break from the work I had been mostly doing in Cambridge, in particular growth theory, development economics and capital theory
i.e. worthless shit. It was obvious that growth and development were about 'mimetics'- imitating a superior country- while 'capital' was about either mobilizing savings (a good thing) or 'extracting surpluses' (beating and stealing).
.... I wanted to work, inspired by Kenneth Arrow, on social choice theory
which was useless nonsense and thus a highly suitable subject for a Bengali to specialize in
(I had started that pursuit in a very preliminary way as an undergraduate in Calcutta ten years earlier but had effectively abandoned it in Cambridge), and, naturally, I wondered whether Hicks had written anything on it. I could not, alas, find anything that even touched on social choice theory, and when I happened to see Hicks personally (this would have been, I think, at the annual meeting of the American Economic Association in December 1963), I asked him why he didn’t give any evidence of being interested in social choice theory. Hicks told me that, on the contrary, he was extremely interested in the subject.
Arrow thought that voting mechanisms are like markets. They aren't because there is nothing analogous to market makers incentivized for 'clearing' operations.
Hicks, like other British intellectuals, was in a quandary about proportional representation. Might it curb the loony left or might it pave the way for Weimar type chaos? At one point, it appeared a Liberal/SDP (created from a right-wing Labour faction) alliance might become a viable 'Party of Government'. Sadly, the thing was useless and stupid.
Indeed, he added, I would see this in his next book. So it was with great expectations that I opened his next book, Capital and Growth (Hicks, 1965), but the index did not give any indication that I might be on to something.
Hicks had come to Pareto through Hugh Dalton. The big question in 1965 was whether Wilson & Benn could do some sort of 'indicative planning' or 'industrial policy' which would cause the 'white heat of the technological revolution' to turn surly shop stewards into Stakhonovites who would raise the growth rate to French or German levels. The answer was- no. Don't be silly. Hicks began to revert to an earlier 'classical liberalism' and kick against the pricks of the 'centralized socialist economy' Britain had become. But, by then, the damage was done. His Indian disciples firmly believed he was a woolly headed Leftie.
I suppose 'Capital & Growth' was useful for teaching 'fix-price' models and came into its own as stagflation got off the ground. Hicks himself seems to have had some aware of developments in what we call FinTech. He had written a paper back in 1935 or thereabouts which could have been elaborated along those lines- or simply accommodated Markowitz's superior contribution. The truth is, some markets are flex-price and do clear because they have a lot of arbitrageurs. Can the flex-price portion of the economy be contained or quarantined by the fix-price portion? My generation's testimony is 'No. Financialization is bound to spread.' But, we may be wrong. There may be a return to Industrial Policy. Unlike the poor, arbitrageurs we may not always have with us.
There was nothing, of course, on social choice, nor anything on crucial institutions for social choice such as majority decisions, or voting rules, or other methods of going from individual preferences to social decisions.
Because all these things had existed in England 800 years before Hicks started his PPE course at Oxford.
Nor did I find anything on liberty, and the sole reference to ‘social welfare function’ by Hicks led me to a very brief – and rather anodyne – statement that seemed to say extremely little.
It said enough. Hicks's English students understood it was 'positive'. Economists at the Treasury should give the Chancellor a menu of what was doable at what price. Let him consult the Cabinet, and make his pick.
Being at a loss, I thought I would look up ‘Arrow’ (I hoped that Hicks would have said something at least on the Arrow paradox and the famous impossibility theorem), and my excitement was great when I found an index item that referred to ‘Arrow, paradox of.’ Now at last, I told myself, I would know what Hicks made of the impossibility theorem. The reference to ‘Arrow paradox’ turned out, however, to be an allusion not to the paradox of social choice by Kenneth Arrow, but to the paradox of ‘the moving arrow’ by Zeno – to wit, that at each indivisible instant the moving arrow could, on Zeno’s reasoning, neither be in motion (for then the instant would not be indivisible) nor at rest (for then the arrow could not be moving at all, since time is made up of an aggregate of such moments).
Space is. Time isn't. The problem with Arrow's theorem is that preferences are epistemic, radically impredicative and thus have no unique or robust representation. They are not 'well defined'. There is no 'graph of the function'. They aren't mathematical objects at all. They can be the subject of no logical operation whatsoever. Forget about Transitivity, Preferences aren't even 'anti-symmetric' i.e. identical to themselves.
While I enjoyed the element of absurdity in the anticlimactic end of my search, I was really sad to be so completely frustrated in not being any wiser on Hicks’s take on social choice theory. Comfort did eventually come plentifully to me, however, when I was able to read his manuscript ‘The Rationale of Majority Rule’; this was in 1980, when that unpublished essay was being placed for inclusion in Hicks’s Wealth and Welfare (1981a), to be published in the following year. The paper is indeed very engaging, and in many ways insightful. This is not because Hicks says anything very interesting, in that essay, on the central content of the social choice difficulty captured by Arrow’s impossibility theorem,
that difficulty is overcome by 'transferable utility'- i.e. bribes or threats or building coalitions in a more or less opaque manner. In other words, politics is the solution of political problems. Math isn't.
but because he has other interesting things to say about problems of social choice. Hicks’s discussion of the arbitrariness – going beyond mere inconsistency – of majority rule is both insightful and important
by then John Maynard Smith's work on uncorrelated asymmetries as promoting bourgeois strategies was known. Arbitrariness is good if it breaks a deadlock. Toss a coin or let there be a show of hands. What is important is that a decision is made rather than that endless bollocks is talked.
(and it certainly involves a different focus of attention from that in the consistency-centered impossibility theorem of Arrow; 1951a). Indeed, the arbitrariness to which Hicks was pointing can be seen both (i) in the general light of showing how capricious it may be to rely on one particular way of counting voting outcomes, ignoring other procedures, and (ii) in the special light of identifying the problems this arbitrariness can create for the liberty and freedom of minority groups and others not in the empowered mainstream.
Indians knew all about this because over the course of the Twenties, Thirties & Forties various ways of counting votes were proposed or adopted. The aim was to prevent Partition and ethnic cleansing. That aim failed altogether wherever it was tried- Sri Lanka, Lebanon, Burma etc. Clearly, voting procedures have no magical power. Dummett & Farquharson (the latter a White South African) wanted some such magical rule so that 'majority rule' could be implemented in Africa, etc., without the extermination, exile or emigration of highly productive minorities. The thing may be doable with 'transferable utility'- i.e. the Big Chief getting very fucking rich- but not by any mathematical voting mechanism. This insight was later expressed by the Gibbard-Satterthwaite theorem. But everybody already knew that no preference aggregation mechanism was strategy proof. Still, you could have good enough mechanisms for tradable goods and services. Look at Ebay or Taskrabbit.
While Hicks also discusses, with an example, the cycles of indecision based on pair-wise majority votes (1981b: 289–91), the real interest in his analysis lies, rather, in his demonstration – and far-reaching discussion – of the immense variability of the social choice outcome of voting procedures depending on what may initially look like small variations in the exact voting rules.
Our interest in this wanes when we realize that everybody and his dog already knows how to vote tactically. More importantly, all sorts of vested interest groups and institutions exist so that it doesn't greatly matter who wins an election.
To exemplify, Hicks considers a preference profile of the individuals over three alternatives a, b, and c (1981b: table 13.1, 288–9) such that: (i) a will win if the highest vote-getter is chosen when each person votes for one alternative only and goes for his or her top choice (Hicks calls this ‘plurality voting’ – a will have plurality but not majority);
If the stupid Professors who wrote the Weimar Constitution had stuck with this, then there would have been no Hindenburg or Hitler. There would have been boring S.D Chancellors focusing on bread and butter issues.
(ii) b will win if the alternative with the smallest support from voters in plurality voting is eliminated, leading to a pair-wise contest between the two top vote-getters (this procedure is sometimes called a ‘run-off’ in political polls in a number of countries for selecting the president of the country, such as France;
This is how Hindenburg got in. He hadn't run in the first round. It was lucky that Ludendorff had gone completely mad. Otherwise, he'd have been Chancellor while Hindenburg was President.
in this case c will be eliminated, and then b will defeat a and have a majority of supporters among all voters); (iii) c will win in pair-wise majority voting, defeating a and b respectively in standard pair-by-pair contest. Hicks not only notes the arbitrariness of the process of selecting an outcome depending on how votes are counted to arrive at the social choice, but also points out how each system ignores some types of possibly relevant information.
Hicks was English. He understood that votes are an arbitrary way of closing a debate so that a decision is made and uncertainty is reduced. However, in things that really matter- e.g. cricket- the safer thing might be to toss a coin.
Sen never understood that if there is 'relevant information' indicating that a decision, one way or another, must be made NOW' then what matters is that it is actually made. How it is made is a matter of 'Schelling focality'. If 'show of hands' is 'focal' (i.e. least resisted) then that's the way to go.
Hicks says-
Majority rule is often defended on the ground that it does at least provide a basis for decision, as compared with the opposite, which is to be found (I suppose) in the ‘liberum veto’, where any elector can prevent a decision; that is of course a strong point. Decisions can nevertheless be biased; and biased decisions, which are such that they continually show the same bias (our ‘cumulative skewness’), are clearly oppressive.
Unless those who don't like them fuck off to greener pastures. The problem for the Brits in places like India and Palestine was that the alternative to the 'oppression' of their Rule was that of ethnic cleansing by dusky folk of other dusky folk. Sen's people ran the fuck away from East Bengal.
There is thus a sharp distinction between the application of majority rule to a homogeneous body of voters – homogeneous in the sense that any voter can expect that in a good proportion of the issues that come up during his life time (or during his ‘planning period’) he will find himself among the majority – and its application to a body which is more permanently divided. […]
Homogeneity did not matter. Predictability did. You run away from a shithole even if you are just as shitty as everybody else there and want the same shitty laws . Then you demand the imposition of those shitty laws in your new place of refuge. After all, you can always run away from it once it too turns into a shithole.
The case is very different when the division is one of colour, of race, of religion or perhaps of language. In a community that is strongly divided in one of these ways, simple majority rule is only too likely to mean Oppression.
No. It is likely to mean an exchange of population or some degree of ghettoization and wage, price and service-provision discrimination. If this is less oppressive or just shitty than the alternative, people put up with it. Catholics remained in Northern Ireland even when the Law permitted their detention without trial. Only the imposition of direct rule, in 1973, put an end to this. Hicks wasn't ignorant of his own country. He understood that its Liberties were conditional on denying them to those who might upset the political applecart in one way or another. This is what he means when he says-
The liberal, or non-interference, principles of the classical (Smithian or Ricardian) economists were not, in the first place, economic principles; they were an application to economics of principles that were thought to apply to a much wider field.
Not that wide. The field was coextensive with those who believed they would benefit materially from further political reforms which increased the power of their own class. The First World War showed that 'economic efficiency' was crucial to national defence. Total war required the total mobilization of the productive resources of the country regardless of gender, class, or even the conscientious objection to bearing arms or undertaking other forms of conscript labour. Universal suffrage was the price Liberalism had to pay in return for being able to sustain 'total war'.
The contention that economic freedom made for economic efficiency was no more than a secondary support.
If Dobb was right and the Soviets could continue to grow at ten percent- while Mao's China grew at 13 percent- then people of Hicks's class might have to accept Soviet principles in wider fields than had been envisaged during the War or under Post-War Rationing. Otherwise, there might be no England. Your grandchildren would speak Russian or Chinese to each other. The Queen, Gor' bless 'er, would eat her Christmas pudding with chopsticks.
What I do question is whether we are justified in forgetting, as completely as most of us have done, the other side of the argument.
That question turned out to be stupid. The Soviets weren't really growing rapidly. That's why their people kept running away to the West. The homosexuals Dobb had recruited for the KGB weren't happy in Moscow. Nor was Sen in Delhi with his Hindu wife. He eloped with his best friend's Italian bride and returned to England within a decade. Arguing that Socialism was terrific was best done in countries converging to the Hayekian common-sense of Thatcher & Reagan.
Sen did not understand England. He had no conception of the strictness and severity of the Rationing that Hicks's generation had lived through. The plain fact is, England chose to give up almost all the benefits of the Market when its own back was against the wall. It was only after Thatcher was elected that Exchange Control disappeared. Once she defeated Scargill, the country could breathe free. The spectre of the 'three day week'- the envenomed stasis Niradh Chaudhuri firmly believed would overtake England- had finally been exorcised. Race ceased to be an issue. Nobody blinked an eye when Rishi Sunak moved into Number 10. Then we realized he was a moron. He probably only became PM because he lost a bet. Still, it was hilarious to hear him channel Alf Garnett and demand the Return of National Service. Sadly, he stopped short of bringing back the birch or the cat o' nine tails.
Sen writes-
Judging markets by the promotion of freedom to choose would be, in Hicks’s understanding, a return to an old, classical tradition in economics.
No. 'Free to Choose' was a Friedmanite slogan. It was never English. That's why we didn't have umpteen crappy channels on TV. The plain fact is, it was a 'Classical' Liberal Government which brought in the Defence of the Realm Act in 1914. Economic freedom disappeared because winning the War was the only thing that mattered. Later, conscription was introduced. People of Sen's class in India enjoyed a liberal night-watchman state under blue-blooded Viceroys. Hicks & Co did not. Compare the Indian hue and cry over the Rowlatt Act- which was lifted in 1922- and its Irish equivalent- only lifted in 1973. Consider the strict rationing in London in 1943 compared to laissez faire Calcutta in that same year. True, there was a famine there- but that was because elected Bengali politicians had been in charge since 1937. Soon, they would ensure that Sen's family had to run away from their ancestral homes. This wasn't Britain's fault. What was its fault- more particularly, the fault of Winston Churchill- was that Bengal didn't get to be enslaved by the Japanese. That was a freedom, or capability, or functioning, which the great Bengali leader Netaji Shubas Chandra Bose gave his life fighting for.
If Hicks is critical of the abandonment of that tradition, it is because he continues to believe that the case for markets rests very substantially on the freedoms they can generate, rather than on only their implications for what is often called ‘economic efficiency.’
No. The opposite is the case. If you have a lot of political and religious and occupational freedom, you are also going to have economic freedom- up to a point. That point has to do with National Security. If it is endangered, you can't take your money out of your country. Your property may be requisitioned. You yourself may be sent to work digging coal or fighting in the trenches. Freedom doesn't come for free. Englishmen understood this. Bengalis didn't.
Writing in the Fifties, when Britain appeared economically dependent on its Empire or quasi-colonial extra-territorial rights in places like Iran and Egypt while also becoming more and more diplomatically and militarily dependent on the USA (though it did get its own nuclear deterrent and delivery system)- there was the galling realization that British Professors and senior Civil Servants would never again enjoy the freedoms of the Edwardian gentleman-scholar- people like Bertie Russell or even E.M Forster.
It was one thing to protect a spy whom you'd been at College with in the Thirties or Forties (there was a British Lord who spied for the Japs who wasn't prosecuted even after Pearl Harbour) but times had changed. The 'Cousins' (i.e. the CIA) took a dim view of chaps covering up for their bum-chums from Eton.
Much of the concentration of power in the hands of large organisations,
like the BBC. But Professors were also aware that now the Government was paying the fees and living expenses of the majority of students, it was efficiency-minded experts at the Ministry who would decide what was taught and to whom. One thing was certain. It would be ghastly stuff and the people imbibing it would have unpleasant accents. Suddenly, you felt yourself warming to darkies from the sub-continent. Theirs was a culture where a man still had servants. He didn't have to iron his own shirts or cook his own mutton chop.
which is the major threat to freedom within Western societies, is technological, not sociological, in its origin.
In other words, if you must blame somebody, blame the Yanks. They have no culture. They have engineering.
I have accordingly no intention, in abandoning economic welfarism,
i.e. taking a job in some Bible-belt College funded by a fucking meat-packer
of falling into the ‘fiat libertas, ruat caelum’ which some latter-day liberals seem to see as the only alternative.
Mutually Assured Destruction was the basis of NATO's offensive strategy. If our liberty must end, so will the whole world!
What I do maintain is that liberal goods are goods; that they are values which, however, must be weighed up against other values.
As, indeed, they were. I suppose there were people who had quietly slunk away from England so as to live safely and luxuriously while their kith and kin sacrificed everything to defeat Hitler.
…we can recognise these limitations, and still feel that these ends are worthier ends than those which are represented in a production index
British people did feel that their own privations and sacrifices were worth it. Those who had decamped for greener pastures when the going got rough, tended to keep very quiet about it.
Hicks was too young to fight in the First World War and too old to fight in the Second. But he had helped tie together National Income Accounting and Macroeconomics and had developed Welfare Econ though. sadly, not in direct linkage to its parent discipline- Public Finance. This was because more than incentive compatibility was involved in that subject at that time. The British were changing themselves to preserve what they considered the most vital or characteristic part of their ethos. It turned out this had nothing to do with governing darkies or being nasty to homosexuals. Let us say it was a 'discovery process'. Hicks was part of it and what he discovered at the end of his days was that his country had made good Social Choices. Not optimal ones. Not efficient ones. But 'regret minimizing' ones. Moreover, as Sen said, everything Hicks touched he made easier to teach. But not everything which is teachable is worth learning.
I cannot therefore now feel that it is enough to admit, with that very moderate Welfarist Sir Dennis Robertson, that ‘the economist must be prepared to see some suggested course of action which he thinks would promote economic welfare turned down – his own judgement consenting, perhaps not – for overriding reasons.
In other words, Economists merely advise on specific matters- 'minute particulars' William Blake called them. They have no insight into 'the general good'. Maybe no one does. Perhaps, we will muddle through and give the credit to Providence. Perhaps, we won't. Still, if we played with a straight bat, our regret will be minimal as we quit this vale of tears.
This is still no more than an admission that there are ‘parts’ of welfare that are not included in Economic Welfare, and that the two sorts of ends may conflict.
No. Welfare doesn't matter when 'overriding reasons' come into play. Sometimes it is sweet and decorous to go to the trenches and die there even though this means missing out on a long, luxurious, life in a Mayfair mansion.
The economist, as such, is still allowed, and even encouraged, to keep within his ‘own’ frontiers; if he has shown that a particular course of action is to be recommended, for economic reasons, he has done his job. I would now say that if he limits his function in that manner, he does not rise to his responsibilities.
More particularly if he is a loyal subject of the Queen Gor' bless 'er.
It is impossible to make ‘economic’ proposals that do not have ‘non-economic aspects’, as the Welfarist would call them;
because of what Maynard Smith would call 'uncorrelated asymmetries'- which give rise to oikeiosis and bourgeois strategies and patriotism and thus being part of a Society whose choices aren't as fucking horrible as those of Herr Hitler.
when the economist makes a recommendation, he is responsible for it in the round; all aspects of that recommendation, whether he chooses to label them economic or not, are his concern.
This is a double edged sword. Don't ask an economist who, in the round, is an asshat, to make a recommendation of any kind. Find a squirrel. Get it drunk. Then ask it for its policy advise. However, it is important that you keep your pants on while making inquiries of this sort. Otherwise you may be arrested for public indecency. I'm not saying this is what happened to me. Actually, it was this other bloke I know. I can't tell you his name because we were in the SAS together.
Sen ends his essay thus-
To conclude, our understanding of economic efficiency may have been profoundly enriched by Hicks’s work,
it isn't. All Hicks, or Pareto for that matter were saying, was that if two or more agents can engage in mutually profitable exchange without hurting anyone else, then allocative efficiency has increased. But that's fucking obvious.
but no one acknowledged with greater clarity the confined and contingent reach of that understanding.
Sen doesn't read over what he has written. He is talking about the understanding of Hicks which people like him have. Since Hicks had no means of knowing how stupid that understanding might be, he could 'acknowledge' nothing about it. It really isn't true that he said 'anyone who reads my books is a fucking cretin. I acknowledge this of my own volition.'
Liberties, distributions of freedoms, minority rights, and other such concerns are not only important, in Hicks’s assessment, but they are subjects into which economists have a responsibility to enter.
Only if asked to make a recommendation. Hicks is saying don't recommend a more efficient way of running a Gulag to an evil Dictator even if he pays you well for it. You have a wider responsibility. On the other hand, if you are an Economist working for the Gas Board tasked with working out the cheapest way to widen the network, don't start babbling about the rights of disabled Lesbian goats in Guatemala. Do the job you are paid to do.
He discussed with great force and lucidity the reasons why the discipline of economics cannot ignore the relevance of liberty
He did no such thing. He, like everybody else, understood that liberties of various sorts had to be greatly curbed if Britain was to avoid coming under Hitler's jackboot. Did he favour early lifting of rationing after the war? I suppose so. But there were always 'overriding considerations'. God had once been an Englishman and had run up certain debts. Hicks himself would have to make recommendations for Jamaica & Nigeria and so forth.
and its far-reaching implications on the assessment of economic understanding and policy.
He did nothing of the sort. He saw that England was semi-centralized and socialized and was probably quite glad when the tide began to turn. Personal liberty did increase over the course of his lifetime but economic liberty had tended to fall till almost towards its end. He sometimes said he'd rather have got the Nobel for his Economic History but we must agree, that the Economic history of his own country hadn't been greatly to his taste for much of his lifetime.
No matter whether – or how well – economists can accommodate this enduring relevance and its implications in their pure economic theory, they cannot abstain from taking into account – to the best of their abilities – their bearing on the decisions on which they, as economists, have to pronounce.
Which is why Rothbard's law works so well. You hire the economist to pronounce the same stupid shite he has been pronouncing for the last fifty years. Bis repetita placent.
There is no way of keeping these broader social choice concerns out of the ‘practical reason’ that economists have to undertake, for which economic epistemology, important as it is, will be, as Hicks argued, an altogether inadequate foundation. Hicks’s understanding of the methods as well as of the substance of economics remains deeply relevant today.
Only if what is deeply relevant today is saying shite which has never been relevant has suddenly become so. But this has never and will never be the case.
Maurice Dobb & Sir John Hicks may have held diametrically opposite political views but both understood that for a country to enjoy liberty- i.e. not be colonized- it may have to do the sort of things Stalin did or accept the sort of restrictions of liberty imposed by Asquith in 1914. Freedom always comes at a price. So does Development and Democracy and being nice to disabled lesbian goats. It is not the case that the 'substance of economics' or even 'moral philosophy' gains relevance by pretending otherwise.
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