Another Unqualified Economist?

First, let me say that I really admire David Brooks, and not just because he once wrote a really awesome piece about being educated by Bruce Springsteen.

Brooks seems to be a man of conviction.  He says what he thinks and doesn’t worry about being called out by the Rushs, sometimes even calling them out.  His Wikipedia page provides a profile of a complex, if not thoughtful guy.  Born in Toronto, raised in Stuyvesant Town, high school on the Main Line just outside Philly and college in Chicago will do that to a guy.

He also often annoys me.  Sometimes it is because he plays devil’s advocate for no particular reason (see previous link).

Other times (and this time), it is because he  uses vague economic terminology. Brooks was a history major at the University of Chicago and no doubt ran in some common circles with future econ wonks.  He claims a changing moment came while debating Milton Friedman, describing it as, “essentially me making a point, and he making a two-sentence rebuttal which totally devastated my point.”

I kind of wish Brooks had actually specialized in economics.  Often his NYT column runs alongside Nobel Prize winner, Paul Krugman. Whether you agree with  Krugman or not, the guy can talk the economics models talk.  I can’t imagine that tenured and aspiring economists alike were all that thrilled when Brooks declared economics dead (while completely ignoring behavioral economics?). While I am not yet the proud owner of a economics PhD, I do think Brooks has a tendency to misuse or greatly oversimplify certain concepts (and not in a good way).

Here he is in today’s NYT:

“Moreover, people who think in this mode are skeptical that business models can be applied to other realms of life. Business is about making choices that maximize utility. But the most important features of the human landscape are commitments that precede choice — commitments to family, nation, faith or some cause. These commitments defy the logic of cost and benefit, investment and return.”

I would argue this is utterly false.  The human commitments to “family, nation, faith, or some cause” are still made by an individual’s attempt to maximize utility.  Is Brooks saying that when parents make sacrifices for their children, they aren’t doing so because they are trying  maximize the benefits for their children?  Or is he saying that we often make irrational monetary choices that don’t maximize utility for ourselves due to these other commitments?  Maximizing utility is obviously not solely about money.  I don’t get his point.

I am not saying people always act rationally.  The factors Brooks  mentions are some that often lead to what some may view as irrational life decisions–the reason I like to write here is because of all the crazy people out there who think they’re acting rationally.

Then again, David Brooks writes articles for the New York Times and I write blog posts–one of the most irrational activities there is!

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2 Responses

  1. Well, yea here’s the thing I maybe kind of sort of agree with him. Though I don’t disagree with you either.

    Economists want to apply their jargon to all areas of human life and while, yes there is absolutely a place in my thinking where I seek maximizing utility in relation to the opportunity cost, there are also times when I feel like economists are completely unwilling to accept that these things do not even enter into the equation. For example, selfless deeds do not maximize utility. The man who jumps on to the subway tracks to save someone isn’t thinking about cost benefit. A soldier who throws himself on a grenade to save his unit isn’t thinking, well I bet this will maximize the benefits of the unit. In fact, I would wager there isn’t a real thought process going on in either case; instead, it is an emotional response (what I think you and economists have called “irrational” in your argument). And here is where Brooks may be right: the economist model of maximizing utility assumes there is thought, that there is a rational cognitive process where options are weighed. It does not account for instinct or merely an emotional compulsion to act. Basically economists are all nurture over nature.

  2. It has got to be tough to be Brooks. He is a pain in the left’s butt and the right thinks he’s not really a right.

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