Posts filed under ‘Methods/Methodology/Theory of Science’
Against Freakonomics
| Peter Klein |
We’ve discussed the Freakonomics phenomenon on these pages, but said little about the substance of Levitt and Dubner’s famous book. (Nicolai offered some brief remarks here — scroll down to the 15 August entry — in the dark days before Organizations and Markets.)
Several new critiques are floating around. Gene Epstein’s book Econospinning: How to Read Between the Lines When the Media Manipulate the Numbers challenges the chapters on real-estate agent services and the abortion-crime link. And from Division of Labour I learn that Ariel Rubinstein reviewed the book, quite harshly, for Haaretz. Rubenstein thinks the book is clever and entertaining, but not really economics. He also takes Levitt and Dubner to task for playing fast and loose with the facts. (more…)
More on Methodological Individualism and Subjectivism
| Nicolai Foss |
In an earlier post, I argued that methodological individualism involves “… almost with necessity some kind of subjectivist methodology.” David Gordon made the comment that methodological individualism does not have “… to involve a commitment to a subjectivist methodology. The sociologist George Caspar Homans combined methodological individualism with behaviorism.” I didn’t have the time to respond to Gordon then, so the following is a somewhat belated response of sorts (or perhaps just some further reflections prompted by Gordon’s comment). (more…)
Levels Issues II: Recommended Reading
| Nicolai Foss |
One of the most insightful discussions of what we may mean by “levels of the social” that I know of is a recent and apparently still unpublished paper with the same title by philosopher (and chancellor) Daniel Little. Litte defends micro-foundations, mechanism-based explanation, denies macro-macro causation, and argues that the “molecule” of social phenomena is the socially situated individual in a local context. Although the latter position may be too much to stomach for the die-hard methodological individualist, there is much with which Austrians and other economists can agree. An excellent read!
Is Austrian Economics Premature?
| Peter Klein |
Rafe Champion on “prematurity” in science:
This when a useful or even important discovery takes a long time to be picked up by the field at large. Mendel’s work on genetics is an example. And so is the Austrian approach to economics and social thought.
Here is Rafe’s review of Ernest B. Hook, ed., Prematurity in Scientific Discovery: On Resistance and Neglect (University of California Press, 2002), which explains it all. Personally, I prefer the moniker “ahead of my time,” but what the heck, I’ll take premature.
Foucault and Economics
| Nicolai Foss |
Catallaxy has a post on “Foucault at the Sydney Institute.” More precisely, the post is about a presentation on Foucault by Foucault scholar, Clare O’Farrell:
She noted that Foucault’s ideas are rapidly growing in popularity and influence in a wide range of fields including the social sciences and the humanities, also nursing, health administration and education. Unfortunately this list coincides with a list of problem areas in my humble opinion, though I would not be rash enough to blame Foucault’s influence alone.
O’Farrell is then ” .. asked about Foucault’s economics … The reply did not address the specific issues but it seems that late in his life Foucault wrote a book (in French) on the rises of neoliberalism.” (more…)
Levels Issues I: Homogeneity and Heterogeneity
| Nicolai Foss |
Issues that relate to levels of analysis are some of the most vexing ones in social science, both theoretically and empirically. I plan to post on levels issues over the coming week or so. Today’s topic: Homogeneity and heterogeneity across levels of analysis. (more…)
Editors, Reviewers, and Academic Judgment
| Peter Klein |
Further to Nicolai’s remarks below:
1. Marginal Revolution had a thread a while back about the best economics journal editors. Don’t know of a similar discussion for other disciplines.
2. The suggestion that editors may defer too heavily to reviewers, rather than forming their own, independent judgments of quality, brings to mind a recent exchange between Leland Yeager and David Laband and Robert Tollison on what Yeager called “secondhandism.” Yeager decried the practice of hiring, promoting, and tenuring faculty based only on quantitative measures of output such as journal rankings, citations, and similar metrics. Laband (who specializes in ranking economics journals) and Tollison replied that hiring and promotion committees should rely, not on their own idiosyncratic opinions, but on the “market test.” Here is Yeager, followed by Laband and Tollison, and Yeager again.
Who Killed the History of Economics?
| Peter Klein |
As discussed here before, economists are not generally familiar with the history of economic thought. Roy Weintraub offers this explanation: Heterodox economists often specialize in the history of economic thought, so mainstream economists come to associate doctrinal history with heterodoxy, thus turning them off to the history of economics itself. (Thanks to Mark Thornton for the cite.)
This explanation strikes me as misguided, for two reasons. First, many heterodox economists publish in history-of-thought journals, attend history-of-thought conferences, and the like not by choice, but because they cannot get their work published in mainstream journals. The perceived link between heterodoxy and the history of economic thought is thus endogenous, begging the question of why mainstream economists are willing to tolerate heterodoxy as history but not otherwise.
Second, and more important, mainstream economists’ lack of interest in doctrinal history is more likely due to the general Whiggishness pervading modern social science. (more…)
Readings on Structural Equations Modeling
| Peter Klein |
I posted a while back on the increasing interest in structural equations modeling (SEM) among economists and management scholars. My PhD student Frayne Olson, an SEM enthusiast (and, incidentally, the nephew of Mancur), sent me some introductory references, which I hereby pass along:
- Rex B. Kline, Principles and Practice of Structural Equation Modeling, 2nd ed. (Guilford Press, 2005). (“A very easy to understand presentation of the SEM concepts and applications.”)
- Ralph O. Mueller, Basic Principles of Structural Equation Modeling: An Introduction to LISREL and EQS (Springer, 1996). (“Uses basic matrix algebra to explain how SEM coefficients are estimated. I have found this to be closer to the typical teaching format used within econometrics textbooks. It may be easier to make the transitions and linkages to traditional regression analysis by reading this book.”)
Addendum: Every good SEM analysis includes a path diagram (like the boxes-and-arrows models filling the pages of the Academy of Management Review). This paper tells you all you could ever want to know, and more, about the theory underlying such diagrams. (Via Technology Ideas for Teachers.) And wouldn’t you much rather see path diagrams like these?
Oskar Morgenstern on Economic Data
| Peter Klein |
Philipp Bagus rehabilitates Oskar Morgenstern’s great, and underappreciated, book On the Accuracy of Economic Observations, first published in 1950. Morgenstern’s target was national income statistics and macro-econometric forecasting, but many of the same issues apply to business forecasting as well.
Methodological Individualism and the Selfish Gene
| Nicolai Foss |
As a staunch advocate of methodological individualism in the social sciences, I have often experienced the following comment at seminar presentations and in conversations: “Why take the individual as the explanatory atom? Why not go further in the direction of reductionism and begin analysis with the selfish gene?”
The comment is usually (though not always) intended to suggest that an advocacy of methodological individualism is fundamentally arbitrary and that there is no reason why individuals should have a privileged status in an explanatory sense. However, the comment is based on a fallacy, which Livia Markoczy and Jeff Goldberg (1998) call the “driver-seat fallacy.” To wit:
It is all too common for people to imagine that evolutionary psychologists and others are claiming that our thoughts and emotions are driven by our genes … This fallacy misunderstands the way genes work. Genes build bodies. … Once the body is built, the genes have no control or influence on what those bodies do. It makes no more sense to say that genes drive our thoughts and emotions than it does to say that genes pump our blood. Our heart pumps our blood and our brain drives our thoughts and emotions … Our genes are not in the driver’s seat, we are.
Thus, the selfish gene argument against methodological individualism is a red herring.
Bell Labs’s New Mandate: Make Money
| Peter Klein |
AT&T’s legendary Bell Labs — home of the transistor, the laser, UNIX, cellular telephony, and other breakthroughs — is being turned into a profit center.
Each [project] is expected to make back six times what it spends on research. Those with the biggest financial potential get the most funding. Researchers often condense their work into eight-minute PowerPoint presentations. [New head Jeong] Kim also seeks more government research grants and is aiming to speed the transformation of technology into products by seeking corporate partners and venture capital.
In earlier days, Bell Labs’ scientists might have rejected Mr. Kim’s commercial approach to science. Not now.
So reports the W$J on today’s front page. I suspect that advocates of increased public funding for R&D will take this as further evidence of the market’s inability to supply public goods. Terence Kealey demurs.
Update: The University of Illinois, recognizing the growing importance of for-profit universities such as the University of Phoenix, will establish a for-profit subsidiary. (Via Richard Vedder)
Scientific Progress in Strategic Management Bleg
| Nicolai Foss |
I have little doubt that strategic management as a field of inquiry has made significant strides forward in the last 3-4 decades. Let’s just ambitiously assert that it has made “scientific progress.” One has little doubt that an overwhelming majority of the Academy of Management’s perhaps dominant division, the Business Policy and Strategy Division, would agree with this assessment. This is not just bias; the BPS may be important because strategic management is a scientific success story. But on what grounds can we assert this? Here are some possibilities: (more…)
Roundup of Interesting Links
| Peter Klein |
Besides the links in the right-hand-side column below, O&M readers may find the following of interest:
- Work Matters by Bob Sutton, Co-Director of Stanford University’s Center for Work, Technology, and Organization
- Marketing Profs Daily Fix Blog by, you guessed it, a group of marketing professors
- Statistical Modeling, Causal Inference, and Social Science, for the research-methods geek in all of us
- Businesspundit, a general-interest site
“Critical” This and “Critical” That
| Nicolai Foss |
At the ongoing Academy of Management Meetings there are a number of sessions with titles such as “Critical Perspectives on Power in Organizations.” Of course, we all know that “critical” is a code-word for left-leaning (often extremely so) work on the issues with which social science deals, in the traditions of mainly European lefty and muzzy sociologists and philosophers, such as Foucault, Habermas, etc.
Still, I am somewhat disturbed that a scholarly organization, such as the AoM, can accept session titles of these kind. The clear implication of these kind of titles is that the rest of us, who may also be interested in, say, “power in organizations,” are not really critical — which to me means that we are not serious scholars. That implication is evidently preposterous, particularly given the low level of scholarship that often characterizes so-called “critical studies,” including those in management.
Where Are the Academic Management Blogs?
| Peter Klein |
Our inaugural post noted the dearth of academic blogs in management, strategy, and other parts of business administration, compared with the many in economics and law. Tonight witnessed a gathering of the near-universe of academic management bloggers — Nicolai, Teppo Felin of orgtheory.net, and myself (Brayden King joins us later) — at the Academy of Management meeting in Atlanta. Why, we asked ourselves, are there so few academic management blogs?
One possibility is opportunity cost. Economists and law professors have fewer consulting opportunities than management professors, and hence more time for blogging. Another is that bloggers appropriate very little of the value their blogs create (OK, assume, arguendo, positive value creation), and business-school professors are too savvy to give away knowledge for free. (Of course, while that might apply to researchers in corporate strategy, which is all about making money, it hardly applies to those in organizational behavior and the other “softer” areas of management.)
I suspect another explanation. Blogging requires a certain temperment, a particular way of thinking. The best bloggers have not only catholic interests, but also — more important — a belief that they can explain a variety of interesting and important phenomena with a few basic principles, consistently applied, and in just a short paragraph or two. This is exactly the way most economists think. “Give me a simple model, and I can explain the world.” Those who prefer more subtle, complex, and ambiguous modes of thought are apt to find blogging an unsatisfying pursuit.
Yet More on Economists and Sociologists
| Peter Klein |
Adding more fuel to the fire are Gordon Smith and Larry Solom. Best line, from Gordon: “Economists just assume sociologists are stupid because that improves the r-squared of the economists’ world view.” (Via Brayden.)
Rafe Champion on Talcott Parsons
| Peter Klein |
Rafe Champion has posted a working paper, “The Success and Failure of Talcott Parsons,” evaluating Parson’s methodology and comparing it to the approaches of Menger, Mises, and Popper. Here is the abstract:
At least three varieties of methodological individualism can be identified in the modern social sciences, all based on the achievement of Carl Menger. These are the praxeology of Ludwig Mises, the voluntarist theory of social action of Talcott Parsons and the situational analysis of Karl Popper. This paper describes how Talcott Parsons drew on Marshall, Pareto, Durkheim and Weber to foumulate an individualistic “action frame of reference” in his first book The Structure of Social Action (1937). The paper also signals some flaws in his approach which drove him to abandon individualism in his subsequent work and to devote himself to the elaboration of the general theory of social systems, a verbal counterpart to general equilibrium theory in economics.
Please send him feedback. And see Mises’s comments on Parsons.
The Power of Ideas . . . ?
| Peter Klein |
Back to sociologists and economists. Brayden King says the leftward bias of academic sociology is largely due to selection. I think the same is true for economics. That is, crunchy, communitarian, big-government progressives are more likely to specialize in sociology or community development, while pro-market, steel-and-concrete individualist libertarians and conservatives are more likely to choose economics or finance.
What does this say, however, about the power of ideas to influence political beliefs? If scholars select into one scientific discipline or another based on prior commitment to a particular social and political worldview, then what generates those worldviews in the first place? Is it possible to change hearts and minds with reason and evidence?
Hayek reports that he started out a Fabian-style socialist but was converted to laissez-faire after reading Mises’s Socialism in 1922. Hayek says the same is true of Lionel Robbins, Bertil Ohlin, and Wilhelm Roepke. These cases seem highly exceptional, however. Can readers suggest other examples? In particular, are there any cases of free-marketeers converting to socialism or interventionism through the study of sociology?
Re: Robustness
| Peter Klein |
Econometric methodology junkies may wish to dig up the December 1988 isssue of the Economic Record, which contains a symposium on same. Contributors include heavyweights Dennis Aigner, Clive Granger, Edward Leamer, Hashem Pesaran, Esfandiar Maasoumi, and P.C.B. Phillips. (If you’re lucky you can get it from EBSCO Host.) I just happened to stumble across a hardcopy of the Leamer article, “Things That Bother Me,” which begins thusly:
I thought I might share with you some things that bother me.
(1) There are too few issues.
(2) There are too many sharp hypotheses.
(3) There are too few graphs.
(4) There is too much asymptotic theory.
(5) There are too many diagnostics.
(6) There is too little testing “the usefulness” of theories/models.
(7) There is too little “confusion.”
Organizations and Markets 
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