The Corner

The one and only.



In one of those posts I mentioned below Wilkinson writes:

But there is a distinction, the core of which appears to be an aversion to appealing to principles or useful generalization. “Pragmatism” rings of openminded practicality, but it is also a convenient hideout for anti-theorists and denialists. There is nothing about the spillover effects and coordination problems Hilzoy mentions that ought to make one hesitate to argue from principle. As I emphasized in a debate about the minimum wage several years ago, economic laws — like the laws of all the “soft” sciences — hold other things equal. If you think other things are not equal, and the generalization does not hold, then it is incumbent upon you to cite the principle of exception (e.g., this market is a monopoly, monopsony, transactions costs are too high, etc.) and provide evidence that it applies to the case at hand.

Longtime readers know that “pragmatism” is one of my perennial philosophical bugaboos. And while I agree with everything Wilkinson says here, I think he leaves out an important point (unless I’m missing his meaning on the word “denialists.”). Pragmatism is a hideout for anti-theorists and denialists, but it is also a hideout for dogmatists. The position Hilzoy seems to be taking is simply this: experts — by which she means liberal experts — can always make the right call. Sometimes liberals decide to let markets work, sometimes they don’t. But the ideological principle is hiding in plain sight: liberal experts are always qualified to make these decisions. This is as ideologically rigid a position as any found on the laissez-faire side of the aisle.

Yes, it’s true that liberals don’t always side with more regulation. But it’s also true that free market folks almost never embrace a zero-regulation position either. The real difference between the two sides resides in the humility, or lack thereof, of the policy-makers. Free market stalwarts are very reluctant to assume they know more than the markets, and so they require a very high burden of proof to intervene. Advocates of a more “pragmatic” approach to regulation, pretty much start from the assumption that they know more than the market at all times, even when they decide to leave the market somewhat unmolested. Still, they require a high burden of proof not to intervene.

My real objection with the interventionists isn’t that they want to intervene in the market as much as they do, it’s that they hide their ideological biases in words like “pragmatism” and mock their opponents as un-empirical ideologues. I have never seen a persuasive argument that mainstream proponents of laissez-faire policies are any less pragmatic or empirical than their mainstream opponents. But we are invariably derided as wild-eyed radicals and dogmatists while the other side claims to be reasonable.

Correction: In the original version of this post I referred to Hilzoy as a “he.” She’s a she.