Academic journal article American Economist

Lumpers and Splitters in Economics, a Note

Academic journal article American Economist

Lumpers and Splitters in Economics, a Note

Article excerpt

Charles P. Kindleberger [*]

In refereeing a paper about financial crises which used the Minsky-Kindleberger model, I encountered the remark that on this subject I am a "lumper," presumably one who views all financial crises as more or less alike. A few days later in idly reading an obituary of someone I did not know, Sir Eric Stokes, a historian of British India, I learned that Sir Eric's demonstration that preexisting Indian political systems and British agrarian taxation had created very different farming outcomes in different parts of north India, was very much the work of a "splitter" rather than a "lumper." (Proceedings of the British Academy, 1997). An essayist, Ann Fadiman in Ex Libris (1998) writes that "George [her husband] is a lumper. I am a splitter." The vocabulary was new to me. The Shorter Oxford English Dictionary (SOED) provides appropriate definitions of each word and relates them, one to the other.

"A lumper is a person (esp. a taxonomist) who attaches importance to similarities rather than differences in classification or analysis, and so favors inclusive categories (Cf SPLITTER);" while a splitter is "a person (esp. a taxonomist) who attaches importance to differences rather than similarities in classification or analysis, and so favors subdivision (Cf. LUMPER)."

The dating system of the SOED indicates that "lumper" came into use in 1830-1869, whereas "splitter" was later: 1870-79.

I gather that the term lumper is not pejorative, and grant that it is more or less true that I believe financial crises have broad similarities. In the contemporary East Asian case, the crises in Thailand, Indonesia, Malaysia, and South Korea were caused by financial deregulation, herd behavior among Asian borrowers and European and North American lenders, fixed exchange rates as expanding quantities of money produced inflation, and with the rising U.S. dollar against the yen, overvalued currencies. It is a puzzle, however, how to weigh the similarities and differences. The December 1998 issue of the Asean Economic Bulletin, for example, has a paper by Andrew McIntyre on domestic political institutions in Thailand and Indonesia which are different though the crises proved to be similar. Thailand's government was honest, weak, indecisive; Indonesia's corrupt with strong and decisive command.

Lumper and splitter, or lumping and splitting are words not common in the social science I read, but seem useful. A new book on Global Transformations (1999) divides analysts on the subject among "hyperglobalizers," "sceptics," and "transformationalists." Hyperglobalists think the organization of the world is entering a new era of political and economic integration and cultural convergence and that the nation-state will atrophy. Sceptics believe that the nation-state will survive and that economic interdependence goes back a long way. Transformationalists take the view that the matter is more complex and that most predictions will be wide of the mark, with separate functions changing in separate ways. The first two categories seem to be lumpers; the last splitters. In this discussion, the authors, David Held and three other British, appear to imply that splitters are intellectually superior to "hyper-globalists" and "sceptics." I am reminded of a statement of a late M.I.T. physicist who claimed that "Everyth ing is more complicated than most people think."

In international relations at the moment, both lumping and splitting are taking place in political organization. There is lumping as the European Union, NAFTA, Mercosur and Asean indicate, and splitting, unhappily in Yugoslavia, and potentially in Quebec, the Basque country, Scotland, Wales. The process of making big ones out of little ones, and little ones out of big ones seems endless. Scholarship deals with separate countries, and larger agglomerations such as the Mediterranean, Latin and Central America, Africa, north and south of the Sahara desert. …

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