The Dismal Science

An optimistic economist is a bit of an oxymoron. After all, economics is sometimes referred to as "the dismal science" due to its practice of determining the optimal allocation of resources without regard to moral concerns. Distressing social realities often follow from this type of interpretation of economic analyses. As a result, some reject economics as morally bankrupt. In trying to achieve some amount of reconciliation, others take a more dangerous approach and adopt economics as a sort of value system in and of itself. Both directions fail to embrace a comprehensive understanding of economics, its potential, and its limitations. Economics is neither the source of evil in the world, the reason for value systems that place certain people above others, nor a guide for how society ought to be organized, and therefore a justification for abolishing government intervention in a variety of affairs. Economics is a tool to help guide decisions. It is immensely powerful in saying how given a particular starting point, resources are optimally allocated to achieve the maximum benefit to a group of people or society. It crucially, however, makes no judgement and provides no guidance as to whether a given starting point is fair, or even desirable. It is this recognition that leads to my optimism about economics. When considered within the appropriate context, and when ideal outcomes related to the welfare of those affected by a decision or system are defined, economics can help us realize our goals by suggesting the most efficient course of actions from possible alternatives. This blog aims to explore the role of economic theory and analysis in addressing contemporary social problems. And in doing so, defend the place of an optimist among the practitioners of the dismal science.