Review of Patton's
"Missing Dimensions in Economics"
Oleg Zinam, Professor
University of Cincinnati
(Published in the Journal of Interdisciplinary Studies
Volume II, No. 1/2 1991)
work is both a critique of conventional economic wisdom and an outline of
his own proposed conceptual framework that may lead to a substantial
overhaul of the discipline. He
argues that in the process of its historical development modern economics
has lost two important dimensions. By
rejecting economic absolutism and moral principles that govern human
actions, economics forfeited its metaphysical-philosophical and
spiritual-moral dimensions. This loss has contributed to the fragmentation
and overspecialization of economics. It
also led to a narrowing of its paradigm, resulting in the present tunnel
vision of the economics profession. Another
deleterious effect has been its inability to provide reliable predictions.
This, in turn, weakened the purposeful guidance needed for the formulation
of sound economic policies.
To support his
thesis, Patton provides a brief historical review.
For Adam Smith -commonly thought of as the first modern economic
theorist - political economy was a branch of moral philosophy.
Smith accepted the physiocratic concept of a divinely ordained
Natural Law that regulates the affairs of men. In this view, the job of
economists is to discover the harmonious natural order and follow it. Back in 1776, the Natural Law tradition was considered a
safeguard to human rights and dignity. Within this order, enlightened
individuals would be guided in their effort to advance their own interests
within a competitive market by an “invisible hand” toward society’s
well-being as a whole.
disciples, David Ricardo and John Stuart Mill, claimed in their labor theory
of value that economic values are created by labor alone. This aspect was
the weakest link in the Classical school of economic thought. It was later
remedied by the contributions of Carl Menger, William Jevons, and Leon
Walras. These economists formulated, independently of each other, the theory
of marginal utility where the value of labor and other factors of production
is derived from the value of finished goods which, in turn, is determined by
utility and scarcity.
rise of Empiricism prompted the belief that economics should also become an
“exact science” just like the natural sciences, relying on the empirical
method. Concurrently, the
emergence of the Humanist school forced economics to divest itself of its
moral foundation and thus become “value-free.” With no place left for
absolute laws, moral values, and the search for truth, economics became a
never-ending process of search for mere regularities in economic activities.
The adherence to such a truncated vision, combined with the economic
environment created by the Great Depression of the 1930s, gave rise to
Keynesian economics. Keynesians
have stressed the inherent instability of capitalism. As an antidote, they
prescribed vigorous governmental intervention to maintain full employment,
economic growth, and price stability.
passed its zenith in the 1970s. It
was challenged by Monetarism and Supply-Side economics and has been in slow
retreat ever since. In
Patton’s view, the Austrian school of economics did not follow the
Humanist methodology that rejected the attainment of absolute truth and
accepted the supremacy of the empirical method.
Instead, the Austrian paradigm, broadened and enriched by Ludwig von
Mises, redefined economics as “a body of inexorable economic principles
based on the self-evident axiom that mankind acts purposefully” (p.5).
In harmony with Smith’s philosophy, the Austrian school claims that
economic laws are universally true and timeless due to their logical
derivation from basic assumptions about human nature.
postulates, and then proceeds to demonstrate, that economic problems are
primarily spiritual in origin. For Patton - a Christian economist - economic failures are
ultimately caused by immoral actions which violate universal economic laws
whose source is God. This restores to economics the second missing
dimension. The restoration of moral laws, and their original source in
economic science, is the primary purpose of what he calls “Biblical
Economics.” Patton contends
that such economics must be based on spiritual laws. Crucially, the
violation of these moral and spiritual laws, and the economic principles
based on them, entails breaking one or more of the Ten Commandments.
his dissatisfaction with the prevailing economic paradigm, Patton joins a
venerable group of other illustrious dissidents.
Among them are, for example, members of the Historical School who
criticized Classicists for narrowness of scope, excessive use of deductive,
abstract and static reasoning, as well as their unwarranted claim to
universality. Thorstein Veblen, on the other hand, took Classicists to task
for their use of a hedonistic concept of “economic man” and a
teleological preconception of a foreordained order.
Patton’s “missing dimensions” are both a challenge to the basic
philosophic foundations of conventional economic analysis and an inspiration
for a fresh reappraisal of the accepted theoretical framework.
Patton’s concerns reveal the need for a systematic reevaluation of
an ultimate metaphysical foundation on which the whole structure of
economics rests. It also
rekindles hopes for moving closer to a broader and more relevant economic
science. Patton’s proposed
theoretical framework remains to be fully developed. Yet his basic missing
dimensions are clearly delineated and courageously stated.
Home - Top