Academic journal article
By Carlson, Mathieu J.
Journal of Economic Issues , Vol. 31, No. 3
Questions concerning the origin of neoclassical theory are among the most basic, yet least satisfactorily resolved, questions in the study of economic thought. Disagreement has notably concerned two issues: whether the theory was "revolutionary" or the product of a gradual evolution, and whether the theory arose from developments internal or external to the discipline of political economy. Most often, historians of economic thought have been "gradualist" and to varying degrees "internalist," i.e., they have characterized the development of neoclassical theory as a slow accumulation of "essential" features in the decades prior to the 1870s and have viewed these features as analytical developments arising from within the framework of the existing discipline of political economy. Neoclassical theory is thus frequently portrayed as a "discovery" - a truth that, given sufficient time and acumen, would have emerged inevitably.
A strongly externalist and non-gradualist account is that of Philip Mirowski [1988; 1989; 1993], who argues that the formulation of neoclassical theory in the 1870s was a "wholesale" metaphorical appropriation of the analytical structure of mid-nineteenth century physics. Neoclassical economics is thus seen not as a "discovery," but as an arbitrary imposition onto social reality of a paradigm taken from an alien field of knowledge. The upshot of Mirowski's account is that if the physics metaphor is developed consistently in economics (as it must be to maintain the mathematical integrity of the model), incongruous results emerge. In particular, the transplantation of a central principle of mid-nineteenth century physics, that of the conservation of energy, into economics leads to the absurd analogy of a constant "sum" of potential utility plus expenditure - a problem that is an aspect of the "integrability problem" that will be explained below.
In broad outline, Mirowski makes two arguments: that metaphorical appropriation is pervasive of scientific (and economic) reasoning; and that an examination of the use of metaphor in neoclassical theory reveals the incoherence of that theory - a consequence, above all, of the transplantation from physics into economics of the principle of the conservation of energy. Mirowski's attention to metaphor is highly illuminating, but I believe it leads to certain misrepresentations and exaggerations, causing both aspects of his thesis to require qualification. First (for reasons discussed below), metaphor is not as pervasive of scientific reasoning as Mirowski contends. Metaphor may be useful as an aid in fashioning the structure of a formal model, but it hardly displaces empirical and epistemological considerations as a source of justification for such models, as Mirowski's account at times seems to imply.
Second, neoclassical theory, like any research program, should be examined in terms of its substantive claims and not only as a metaphorical appropriation. Viewing neoclassical theory as a "substantive story" in its own right, two points emerge: first, that the neoclassicals had special programmatic reasons for utilizing a physical metaphor - reasons pertaining to their conception of the economy as a natural system; and second, that given the neoclassicals' particular economic-theoretical objectives, a "proto-energetics" model able to capture maximizing behavior of agents with respect to commodities may have been the inevitable mode of rendering such aspirations formally. I will argue that the problems associated with integrability arise not simply as undesired by-products of the abstract model that was chosen, but from an epistemological dilemma inherent to the neoclassical project itself. This is the ontological divide between the subjective reality of preference mappings and the physical reality of commodity exchange, an illegitimate straddling of the mind-body dualism.
In assessing Mirowski's arguments, it is important to note the grounding of his analysis in a rejection of the traditional Cartesian framework of Western thought and adoption of an alternative hermeneutic approach to knowledge, according to which "our criteria of knowledge [are] always . …