Economics: a discipline committing suicide?
Science, reality and social decay.
Can an academic discipline seriously decline? Yes. Disciplines which were once mainstays of universities have either vanished or shrunk to pale shadows of their former selves.
What about a social science? One can envisage a social science disappearing. The most obvious way is it gets utterly discredited and replaced. A less obvious way is its institutional bases could disappear. A final way is its entire social basis disappears.
The West is currently marked by two entirely different discourses on migration that seem unable to interact. One is migration-as-economic-boon. This is the outlook of mainstream Economics. Migrants add to the economic activity of societies and potentially retard the effect of an ageing population by replacing absent local children with foreign migrants. This discourse invokes the authority of Economic Theory and its statistical methods.
This outlook typically treats criticism of migration as economically illiterate, socially retrograde, or morally bankrupt; or some combination of thereof. It is protected by the Self-Righteous, Knowing scoff which is such a feature of the modern professional-managerial class. They are the Masters of Knowledge, and of Moral Concern, who the plebs should defer to.
The other discourse talks in terms of social and democratic decay, increased crime, threats of violence, increased fiscal stress, even the possibility of civil war.
This is the world where, in Sweden—due to the stress on social and fiscal order from migration—it has become policy to pay migrants to go away. This is the world where highly intelligent and informed folk quietly discuss how the performance of economists on migration has been so catastrophically bad, it may bring down the entire discipline.
The adherents of the second, problems-with-migration, discourse are well aware of what mainstream Economics has to say on migration, and judge it to be obviously and demonstrably—even catastrophically—false. That it is much harder for migrants to contribute positively to a society than mainstream Economics admits, and this gets worse the higher the rate of migration. A recent Dutch study (Jan van de Beek, Joop Hartog, Gerrit Kreffer, Hans Roodenburg, The Long-Term Fiscal Impact of Immigrants in the Netherlands, Differentiated by Motive, Source Region and Generation, IZA DP No. 17569, December 2024. https://docs.iza.org/dp17569) found that:
Only 20% of all immigrants [to the Netherlands] make a positive lifetime net contribution to the public budget. Groups with large contributions come from Scandinavia, the Anglo-Saxon world and a few other countries like France and Japan.
The adherents of the first discourse seem either utterly unaware of the second discourse, or protected from even considering it by the Self-Righteous Knowing scoff. Their mastery of Theory is such, they cannot possibly be so catastrophically wrong.
The notion that migration could break a society along its existing fracture lines to the point of civil war would absolutely be treated with the Self-Righteous Knowing scoff, despite there being—as is discussed below—at least three historical examples of precisely that happening.
Which points to the key difference between the two discourses. The first is based in Theory, the second on observation and history.
The migration scam
[Replaces a deleted graph from the Economic Policy Institute. It turns out the Economic Policy Institute is presenting the data in the deleted graph in a very misleading way.]Thanks for reading Lorenzo from Oz! Subscribe for free to receive new posts and support my work.
If any Western developed democracy slides into civil war as a result—in whole or in part—of mass migration, will anyone listen to mainstream economists ever again? Would the antipathy becomes more mere angry contempt? Would it become more violent?
One thing is very clear. This is not a dispute between scholarship and non-scholarship. Those who worry about the costs and effects of mass migration have plenty of scholarship they can cite.
This dispute is between scholarship using Theory as a drawbridge—as a way to grade and select what evidence counts and when—and scholarship that looks at the patterns of history and of current events.
It is not even a divide between Economic and non-Economic scholarship. The first serious study of how mass migration can fracture a society along its pre-existing fault lines that I read was Without Consent of Contract: The Rise and Fall of American Slavery [1989] written by Robert Fogel (1926-2013), 1993 Nobel memorial laureate in Economics. This history examined how mass migration fractured the American republic along its existing fault-lines of slavery, as I discuss here.
An American Civil War
The release of a trailer for a film portraying a new US Civil War has increased discussion of such a possibility. The possibility of a new American Civil War was already the subject of speculation, due to the increasing polarisation of US politics.
At least two other countries have had civil wars sparked by immigration, both involving Palestinian migration: Jordan in 1970, Lebanon in 1975-1990. Yet I have never seen any economist—talking of the “clear” economic benefits of migration—even suggest that civil war is a risk even though there are three, clear, historical cases of precisely that.
There is plenty of scholarship written by economists which points to problems—potentially serious problems—with migration, though much of it is not “migration” Economics as such. Those whose migration-is-obviously-positive views are protected by the Self-Righteous, Knowing scoff are in the wrong; in a straightforward intellectual sense. They show nowhere near enough intellectual curiosity and way too much academic dogmatism. I am not sure what you call the notion that there is this thing—migration—where the marginal benefits exceed the marginal costs for everyone and/or the entire society, over all ranges, but it is not Economic in the study of choice under constraint sense.
That points to two other major problems with mainstream Economics. The first is its failure to ensure that it is consilient with Evolutionary Biology and Evolutionary Anthropology. This is a fundamental scientific failure. Everything social is emergent from the biological. Any social science that is not consilient with what we know from evolutionary biology and evolutionary anthropology is—to the extent it is not so consilient—wrong.
The dogmatism on migration ultimately derives from the Samuelsonian paradigm of people as economic “particles” who can be analysed by a mathematical social physics. This paradigm is, at best, extremely limited in that ambit of phenomena it applies to, or, at worst, simply wrong. In the words of a review article on the effects of culture (Nathan Nunn, ‘Culture And The Historical Process,’ NBER Working Paper 17869, February 2012 http://www.nber.org/papers/w17869):
Although using very different methodologies, the studies all provide evidence leading to the same general conclusion: individuals from different cultural backgrounds make systematically different choices even when faced with the same decision in the same environment. (Emphasis added.)
That one finding demolishes not only a lot of “Samuelsonian” social physics economics; it demolishes most of migration Economics, while conforming to the concerns and observations of the migration-has-serious-problems discourse.
The Loury principle—that social relations precede economic transactions—points to why culture-seriously-matters is such a persistent finding. A fundamental feature of Homo sapiens is that our children are so biologically expensive. This creates a fundamental structuring principle of human society—the transfer of risks away from, and resources to, child-rearing. It means that Homo sapien fathers are remarkably involved in the upbringing of their children compared to any other mammal. It helps drive differences between the male and female expression of genes in Homo sapiens. It means we are a remarkably normative species—far more so than our Pan cousins. It means we are embedded in social connections, in social relations, in the acquisition of schemas (patterns of belief) and scripts (patterns of action), for around two decades before we start seriously engaging in economic transactions.
It means that social relations precede economic transactions. It means that culture, and cultural distance, matters. It means that individuals from different cultural backgrounds make systematically different choices even when faced with the same decision in the same environment. It means that mainstream Economics scholarship on migration is wrong: potentially catastrophically so.
A key element in the potentially catastrophic errors of the mainstream migration-as-boon discourse is that it values efficiency very highly and resilience not at all. Economist Robin Hanson provides a particularly striking version of this efficiency-uber-alles view.
Economic efficiency is a standard that we economists use to evaluate policies. We are to ask how much people would be willing to pay, or be paid, to get some policies over others, considering all of the effects of such policies, and all of the ways people care about those policies, and given the same shared information about those policies. A policy is more efficient if people would pay more in total to get it.
By its construction, it is hard to idealize efficiency by dropping details, as it is already defined in terms of all the possibly relevant details. And an attitude of refusing to trade off other things against efficiency has little effect, as efficiency already embodies all possible tradeoffs. Thus treating efficiency as sacred does relatively little to distort it.
No one who paid any attention to biological systems would believe this for a moment. Yes, there is selection for efficiency within biological systems, but efficiency that serves resilience: the ability to adapt to changing circumstances.
Social analysis consilient with biology
A living organism uses information and resources to keep itself functioning. Information is:
An organism—especially a complex organism such as ourselves—uses multiple systems. Hence, resilience is multi-dimensional. The ability to move swiftly between systems, and to cope with stress, requires redundancy, which is “inefficient”. It is absolutely possible to trade-off/reduce resilience by having too much efficiency.
This is, in a nutshell, what is wrong with mainstream Economics on migration. It treats economic efficiency as a single dimension that dominates all others, and humans as economic “particles” who can be examined by a social physics.
But culture matters and societies are multi-dimensional systems. Societies require the social “padding” that resists and responds to shocks effectively. Having a high-trust society is one such “padding”. That requires the right sort of convergence in normative expectations. That convergence is something that bringing in lots of people with highly divergent normative expectations (i.e. cultural distance) undermines.
The difference between the two discourses is between those who do, indeed, make efficiency sacred—and pay no heed to resilience—and those who regard social resilience as key to a successful, continuing society.
So, mainstream Economics could be discredited as a discipline by events. It could be discredited by its increasing divergence from other scientific findings. It could also discredited by the disappearance of its social basis: such as, for example, a terminal collapse in human fertility.
The treatment of economic production as the key point of social activity is doing its bit to generate fertility collapse. People are expected to serve the production process, rather than the production processes serving people.
The idea that GDP can seriously substitute for having children in generating and maintaining a resilient society is nonsense. There is a lot more going on regarding fertility collapse than the silly narrowness of mainstream Economics. But that silly narrowness is not helping.
The last is clearly a slow, long-run matter. The problem with failure of scientific credibility is clearly not enough in itself: there is lot of social “science” that is incompatible with evolutionary biology and evolutionary anthropology. Of course, that incompatibility leads directly to toxic ideas and policies. Still, it is not clear at what point that catches up with a discipline, given how poor reality-tests—and how dysfunctional feedback effects—are in contemporary academe.
But, if any Western democracy does slide into civil war because—even just in part—of mass migration, mainstream Economics will surely be done. It is a sign of the arrogance of Theory that is at the heart of the problem that so few economists are even aware of the problem. But, as I have noted in other posts, history is full of elites brought down by the purblind stupidity of arrogance.
References
Jan van de Beek, Joop Hartog, Gerrit Kreffer, Hans Roodenburg, The Long-Term Fiscal Impact of Immigrants in the Netherlands, Differentiated by Motive, Source Region and Generation, IZA DP No. 17569, December 2024. https://docs.iza.org/dp17569
David Betz, ‘Civil War Comes to the West,’ Military Strategy Magazine, Volume 9, Issue 1, summer 2023, 20-26. https://www.militarystrategymagazine.com/article/civil-war-comes-to-the-west/
Robert William Fogel, Without Consent or Contract: The Rise and Fall of American Slavery, W.W.Norton, [1989], 1994.
Herbert Gintis, Carel van Schaik, and Christopher Boehm, ‘Zoon Politikon: The Evolutionary Origins of Human Political Systems,’ Current Anthropology, Volume 56, Number 3, June 2015, 327-353. https://pubmed.ncbi.nlm.nih.gov/29581024/
Tim Kaiser, Marco Del Giudice, Tom Booth, ‘Global sex differences in personality: Replication with an open online dataset,’ Journal of Personality, 2020, 88, 415–429. https://onlinelibrary.wiley.com/doi/10.1111/jopy.12500
Glenn C. Loury, The Anatomy of Racial Inequality: The W.E.B Du Bois Lectures, Harvard University Press, 2002.
C.F. Martin, R. Bhui, P. Bossaerts, T. Matsuzawa, & C. Camerer, ‘Chimpanzee choice rates in competitive games match equilibrium game theory predictions,’ Scientific Reports, 2014, 4, 5182. https://www.researchgate.net/publication/262885591_Chimpanzee_choice_rates_in_competitive_games_match_equilibrium_game_theory_predictions
Nathan Nunn, ‘Culture And The Historical Process,’ NBER Working Paper 17869, February 2012 http://www.nber.org/papers/w17869
Jordan E. Theriault, Liane Young, Lisa Feldman Barrett, ‘The sense of should: A biologically-based framework for modeling social pressure,’ Physics of Life Reviews, Volume 36, March 2021, 100-136. https://pubmed.ncbi.nlm.nih.gov/32008953/
United Nations, Replacement Migration: Is it A Solution to Declining and Ageing Populations?, Population Division Department of Economic and Social Affairs United Nations Secretariat, 21 March 2000. https://www.un.org/development/desa/pd/sites/www.un.org.development.desa.pd/files/unpd-egm_200010_un_2001_replacementmigration.pdf
Kudos.
If you live in a secular nation with generally good work ethics and administration, that is the reason you live in a developed nation.
There was a time when pro-immigrationists rhapsodized about "assimilation."
Then one day it become "multi-culturalism."
Even if I liked the culture I was born into, knew it had provided me with high living standards, and was one that I loved in many ways, I was supposed to embrace "multi-culturalism" or be labeled a nativist bigot.
But what if the other cultures do not respect individual rights, or revere separation of church and state? Or regard correct religion and instruction as more important than economic progress? Or bring rank prejudices with them towards other religions and ethnic groups?
"History is full of elites brought down by the purblind stupidity of arrogance."
I think we might be in one of those historical moments when the bill is falling due for arrogant – and, more to the point, incompetent – elites, Lorenzo. So please keep kicking those smug PMC experts while they are vulnerable.