Talk:Neoclassical economics

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nice job on the rewrite - might be good to also review factors of production to see if what's said there is truly neutral w.r.t. classical, neoclassical, Marxist, green views.

If members of Congress believed neoclassical economic theory, why might they be persuaded to reduce taxes on wage and interest incomes?

Contents 1 behavioral economics heterodox? 2 Criticisms of neoclassical economics 3 Platonists == neoclassical economists? 4 On the distinctions amongst neoclassical economics, Austrian School economics, and marginalism 5 Neoclassical economics?

[edit] behavioral economics heterodox?

Is it really correct to place behavioral economics among the other heterodox schools? It surely is a lot more mainstream than the other schools. For example it has received one Nobel prize (two if you count Herbert Simon), two John Bates Clarck medals and papers written from the behavioral perspective are reguraly published in the most prestigious journals.

217.210.4.92 09:33, 4 August 2006 (UTC)

[edit] Criticisms of neoclassical economics

Neoclassical economics is sometimes criticised for having a normative bias. In this view, it does not focus on explaining actual economies, but instead on describing a "utopia" in which Pareto optimality obtains. Key assumptions of neoclassical economics which are widely criticised as unrealistic include:

The focus on individuals in the economy may obscure analysis of wider long term issues, such as whether the economic system is desirable and stable on a finite planet of limited natural capital.

I'm removing this first "assumption" as it is not actually an assumption. If someone else want to rework it and put it back in so that it makes sense, go ahead. 72.75.241.36 19:58, 28 February 2007 (UTC)

You're right that the third sentence above suggests a series of assumptions (immediately followed by criticisms for each) but does not follow through. A rewrite is needed to fix the inconsistency. --Thomasmeeks 20:28, 28 February 2007 (UTC)

The whole section needs a broad rewrite. I may do it when I have time. Criticism seem to come in a few types: -Utility assumptions/Rational Agents -Profit Maximization on the firm side -Aggregation issues (basically everyone knows this is a problem, question is degree) -Philisophical (Method): too much math/computers/blackboxes -Philisophical (Objective): what NCE wants to do is impossible/not useful. -Political: People don't like results or feel the wrong questions are being asked. How much detail do we really need on the 101 criticism? Everyone has a pet critique of the dominant theory, many are rather technical and others can be addressed within the framework. What do you keep of the current mess? 149.169.67.51 01:48, 2 May 2007 (UTC)

The criticism section is not too clear. A non-expert cannot easily tell which are minor criticism and which is major. Perhaps first divide it up as above remarks then start trimming. KAM 12:11, 1 June 2007 (UTC)

[edit] Platonists == neoclassical economists?

I read somewhere that neoclassical economics is platonism. Why is that so? __earth ^(Talk) 02:43, 20 February 2008 (UTC)

It isn't. Someone is either making sweeping over-generalizations, or using terms so loosely as to be very unhelpful. —SlamDiego_←T 21:34, 7 March 2008 (UTC)

[edit] On the distinctions amongst neoclassical economics, Austrian School economics, and marginalism

This article is presently written as if necoclassical economics subsumes marginalism more generally.

The first published appearance of the term “neoclassical” in reference to economics is in Veblen's “The Preconceptions of Economic Science”, Pt III (QJE v14 (1900)):

No attempt will here be made even to pass a verdict on the relative claims of the recognised two or three main “schools” of theory, beyond the somewhat obvious finding that, for the purpose in hand, the so-called Austrian school is scarcely distinguishable from the neo-classical, unless it be in the different distribution of emphasis.

Note that Veblen writes of a world in which the Austrian School is viewed as different from the neoclassical economists (though Veblen sees them as having shared preconceptions to which he objects).

Yet, in textbooks written by neoclassical economists (and by many anti-marginalists), neoclassical economics and marginalism are usually simply treated as the same thing, and Austrian School economics are treated as a variety of neoclassical economics.

In fact, the Austrian School is certainly marginalist. The neoclassical economists have also always been at least somewhat marginalist, albeït that for a time they walked away from marginal utility (and not all of them have reëmbraced it). But neither school subsumes the whole of marginalism.

The reason that the neoclassical school is called “neoclassical” or “neo-classical” is that, while they embraced marginal utility in the explanation of the demand curve, they explained the supply curve much as had the classical economics, in terms of objective costs whose structure was determined by physical processes. The Austrian School, meantime, saw the supply curve as a complementary demand curve, with the marginal utilities of producers determining their willingness to trade good for money. The neoclassical economists utterly failed to understand this view, and mistook the Austrian School for claiming that price were simply determined by one demand curve. Hence Marshall's foolish-yet-lauded analogy of cloth being cut by both blades of scissors.

The neoclassical economist were so convinced that Marshall's synthesis had captured all of the insights of marginalism that they began to write the history of economics as if marginalism had come together with Marshall's Principles. Many eventually lost the distinction between marginalism in general and neoclassical economics in particular, and hence (since the Austrian School were plainly marginalist) began to write of the Austrian School as “neoclassical”. But the Austrian School has for the most part resisted such unfortunate confusions. —SlamDiego_←T 03:10, 18 March 2008 (UTC)

[edit] Neoclassical economics?

McCloskey, an economic historian, says that neoclassical is a "misnomer", as should include Austrians and Marshallians. I'd like to expand on this criticism and make it a section under the criticisms. Let me know if you find any other papers. Here is a paper on the origins of the term, which should be relevant for this page. ImpIn | (t - c) 04:00, 10 June 2008 (UTC)