Bonus Quotation of the Day…

by Don Boudreaux on October 3, 2013

in Economics, Work

… is also from the late Jim Buchanan; it is today’s “Quote of the Day” at the website of the GMU Economics Society – the very active club of the many impressive and intellectually curious GMU econ majors:

The inverse relationship between quantity demanded and price is the core proposition in economic science, which embodies the presupposition that human choice behavior is sufficiently rational to allow predictions to be made.  Just as no physicist would claim that “water runs uphill,” no self-respecting economist would claim that increases in the minimum wage increase employment.  Such a claim, if seriously advanced, becomes equivalent to a denial that there is even minimal scientific content in economics, and that, in consequence, economists can do nothing but write as advocates for ideological interests.  Fortunately, only a handful of economists are willing to throw over the teaching of two centuries; we have not yet become a bevy of camp-following whores.

(This quotation originally appeared in a letter that Jim published in the Wall Street Journal on April 25, 1996.)

Jim is correct.  It is pseudo-science to refuse, in the name of science, to generalize.  (See this earlier post.)  Of course we, as seekers of truth and understanding, must be open to the possibility that we might generalize mistakenly and that there are exceptions to our generalizations.  But when a proposition is so very firmly established – in formal theory, by scientific observation, and by informal and everyday experience – as is the law of demand, the burden of persuasion falls very heavily indeed upon those who insist that that proposition which holds for a, b, c, … n does not hold for j.

Maybe j is an exception.  But when empirical studies are at best mixed on whether or not j is an exception to the general proposition – and when the reality studied empirically is as complex as is any real-world labor market (with so many variables, some observable and some not, in play and changing constantly) – and when nothing about the reality of j convincingly points to a reason for supposing that is an exception to the general proposition – and when powerful political sentiments and forces are furthered by an acceptance of the claim that is an exception to the general proposition - a high regard and respect for science counsels great skepticism of the claim that j is an exception to the general proposition.

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