AnarWiki/markdown/C.1.1_(An_Anarchist_FAQ).md

**C.1.1 Is economics really value free?** is the second chapter of
[Section
C](Section_C:_What_are_the_myths_of_capitalist_economics?_\(An_Anarchist_FAQ\) "wikilink")
of [An Anarchist FAQ](An_Anarchist_FAQ "wikilink").

## Transcript

Modern economists try and portray economics as a “value-free
[science](science "wikilink").” Of course, it rarely dawns on them that
they are usually just taking existing social structures for granted and
building economic dogmas around them, so justifying them. At best, as
[Kropotkin](Peter_Kropotkin "wikilink") pointed out: “\[A\]ll the
so-called laws and theories of political economy are in reality no more
than statements of the following nature: ‘Granting that there are always
in a country a considerable number of [people who cannot subsist a
month, or even a fortnight, without earning a
salary](Working_Class "wikilink") and accepting for that purpose the
conditions of work imposed upon them by the
[State](State_\(Polity\) "wikilink"), or offered to them by those whom
the [State recognises as owners ofland, factories, railways,
etc.](Capitalism "wikilink"), then the results will be so and so. ’“So
far academic political economy has been only an enumeration of what
happens under these conditions — without distinctly stating the
conditions themselves. And then,having described the facts which arise
in our society under these conditions, they represent to us these facts
as rigid, inevitable economic laws.”\[Anarchism, p. 179\]

In other words, economists usually take the political and economic
aspects of capitalist society (such as property rights, inequality and
so on) as given and construct their theories around it. At best. At
worse, economics is simply speculation based on the necessary
assumptions required to prove the desired end. By some strange
coincidence these ends usually bolster the power and profits of the few
and show that the free market is the best of all possible worlds. Alfred
Marshall, one of the founders of neoclassical economics, once noted the
usefulness of economics to the elite: “From Metaphysics I went to
Ethics, and found that the justification of the existing conditions of
society was not easy. A friend, who had read a great deal of what are
called the Moral Sciences, constantly said: ‘Ah\! if you understood
Political Economy you would not say that’” \[quoted by [Joan
Robinson](Joan_Robinson "wikilink"), Collected Economic Papers, vol.4,
p. 129\] Joan Robinson added that “\[n\]owadays, of course, no one would
put it so crudely. Nowadays, the hidden persuaders are concealed behind
scientific objectivity, carefully avoiding value judgements; they are
persuading all the better so.” \[Op. Cit., p. 129\]

The way which economic theory systematically says what bosses and the
wealthy want to hear is just one of those strange co-incidences of life,
one which seems to befall economics with alarming regularity. How does
economics achieve this strange co-incidence, how does the “value free”
“science” end up being wedded to producing apologetics for the current
system? A key reason is the lack of concern about history, about how the
current distribution of income and wealth was created. Instead, the
current distribution of wealth and income is taken for granted. This
flows, in part, from the static nature of neoclassical economics. If
your economic analysis starts and ends with a snapshot of time, with a
given set of commodities, then how those commodities get into a specific
set of hands can be considered irrelevant — particularly when you modify
your theory to exclude the possibility of proving income redistribution
will increaseoverall utility (see section
[C.1.3](C.1.3_\(An_Anarchist_FAQ\) "wikilink")).

It also flows from the social role of economics as defender of
capitalism. By taking the current distribution of income and wealth as
given, then many awkward questions can be automatically excluded from
the “science.” This can be seen from the rise of neoclassical economics
in the 1870s and 1880s. The break between classical political economy
and economics was marked by a change in the kind of questions being
asked. In the former, the central focus was on distribution, growth,
production and the relations between social classes. The exact
determination of individual prices was of little concern, particularly
in the short run. For the new economics, the focus became developing a
rigorous theory of price determination. This meant abstracting from
production and looking at the amount of goods available at any given
moment of time. Thus economics avoided questions about class relations
by asking questions about individual utility, so narrowing the field of
analysis by asking politically harmless questions based on unrealistic
models (for all its talk of rigour, the new economics did not provide an
answer to how real prices were determined any more than classical
economics had simply because its abstract models had no relation to
reality).

It did, however, provide a naturalistic justification for capitalist
social relations by arguing that profit,
[interest](Interest_\(Finance\) "wikilink") and [rent](rent "wikilink")
are the result of individual decisions rather than the product of a
specific social system. In other words, economics took the classes of
capitalism, internalised them within itself, gave them universal
application and, by taking for granted the existing distribution of
wealth, justified the class structure and differences in market power
this produces. It does not ask (or investigate) why some people own all
the [land](land "wikilink") and capital while the vast majority have to
sell their labour on the market to survive. As such, it internalises the
class structure of capitalism. Taking this class structure as a given,
economics simply asks the question how much does each “factor” (labour,
land, capital) contribute to the production of goods.

Alfred Marshall justified this perspective as follows: “In the long run
the earnings of each agent (of production) are, as a rule, sufficient
only to recompense the sum total of the efforts and sacrifices required
to produce them... with a partial exception in the case of land ...
especially much land in old countries, if we could trace its record back
to their earliest origins. But the attempt would raise controversial
questions in history and ethics as well as in economics; and the aims of
our present inquiry are prospective rather than retrospective.”
\[Principles of Economics, p.832\] Which is wonderfully handy for those
who benefited from the [theft](Enclosure "wikilink") of the [common
heritage of humanity](Commons "wikilink"). Particularly as Marshall
himself notes the dire consequences for those without access to the
means of life on the market: “When a workman is in fear of hunger, his
need of money is very great; and, if at starting he gets the worst of
the bargaining, it remains great ... That is all the more probably
because, while the advantage in bargaining is likely to be pretty well
distributed between the two sides of a market for commodities, it is
more often on the side of the buyers than on that of the sellers in a
market for labour.” \[Op. Cit., pp. 335–6\]

Given that market exchanges will benefit the stronger of the parties
involved, this means that inequalities become stronger and more secure
over time. Taking the current distribution of property as a given (and,
moreover, something that must not be changed) then the market does not
correct this sort of injustice. In fact, it perpetuates it and,
moreover, it has no way of compensating the victims as there is no
mechanism for ensuring reparations. So the impact of previous acts of
aggression has an impact on how a specific society developed and the
current state of the world. To dismiss “retrospective” analysis as it
raises “controversial questions" and “ethics” is not value-free or
objective science, it is pure ideology and skews any “prospective”
enquiry into apologetics. This can be seen when Marshall noted that
labour “is often sold under special disadvantages,arising from the
closely connected group of facts that labour power is ‘perishable,’ that
the sellers of it are commonly poor and have no reserve fund, and that
they cannot easily withhold it from the market.” Moreover, the
“disadvantage, wherever it exists, is likely to be cumulative in its
effects.” Yet, for some reason, he still maintains that “wages of every
class of labour tend to be equal to the net product due to the
additional labourer of this class.” \[Op. Cit., p. 567, p. 569 and p.
518\]

Why should it, given the noted fact that workers are at a disadvantage
in the market place? Hence Malatesta: “Landlords, capitalists have
robbed the people, with violence and dishonesty, of the land and all the
means of production, and in consequence of this initial theft can each
day take away from workers the product of their labour.”[\[Errico
Malatesta]([Errico_Malatesta "wikilink"): His Life and Ideas, p. 168\]
As such, how could it possibly be considered “scientific” or
“value-free” to ignore history? It is hardly “retrospective” to
analyse the roots of the current disadvantage working class people have
in the current and "prospective" labour market, particularly given that
Marshall himself notes their results. This is a striking example of what
Kropotkin deplored in economics, namely that in the rare situations when
social conditions were “mentioned, they were forgotten immediately, to
bespoken of no more.” Thus reality is mentioned, but any impact this may
have on the distribution of income is forgotten for otherwise you would
have to conclude, with the anarchists, that the “appropriation of the
produce of human labour by the owners of capital \[and land\] exists
only because millions of men \[and women\] have literally nothing to
live upon, unless they sell their labour force and their intelligence at
a price that will make the net profit of the capitalist and ‘surplus
value’ possible.”\[Evolution and Environment, p. 92 and p. 106\]

This is important, for respecting property rights is easy to talk about
but it only faintly holds some water if the existing property ownership
distribution is legitimate. If it is illegitimate, if the current
property titles were the result of theft, corruption, colonial conquest,
state intervention,and other forms of coercion then things are obviously
different. That is why economics rarely, if ever, discusses this. This
does not, of course, stop economists arguing against current
interventions in the market (particularly those associated with the
welfare state). In effect, they are arguing that it is okay to reap the
benefits of past initiations of force but it is wrong to try and rectify
them. It is as if someone walks into a room of people, robs them at gun
point and then asks that they should respect each others property rights
from now on and only engage in voluntary exchanges with what they had
left. Any attempt to establish a moral case for the “free market” in
such circumstances would be unlikely to succeed.

This is free market capitalist economics in a nutshell: never mind past
injustices, let us all do the best we can given the current allocations
of resources. Many economists go one better. Not content in ignoring
history, they create little fictional stories in order to justify their
theories or the current distribution of wealth and income. Usually, they
start from isolated individual or a community of approximately equal
individuals (ac ommunity usually without any communal institutions). For
example, the “waiting” theories of profit and interest (see section
[C.2.7](C.2.7_\(An_Anarchist_FAQ\) "wikilink")) requires such a fiction
to be remotely convincing. It needs to assume a community marked by
basic equality of wealth and income yet divided into two groups of
people, one of which was industrious and farsighted who abstained from
directly consuming the products created by their own labour while the
other was lazy and consumed their income without thought of the future.
Over time, the descendants of the diligent came to own the means of life
while the descendants of the lazy and the prodigal have, to quote Marx,
“nothing to sell but themselves.” In that way, modern day profits and
interest can be justified by appealing to such “insipid childishness.”
[Capital]([Das_Kapital "wikilink"), vol. 1, p. 873\]

The real history of the rise of capitalism is, as we discuss in section
[F.8](F.8_\(An_Anarchist_FAQ\) "wikilink"), grim. Of course, it may be
argued that this is just a model and an abstraction and, consequently,
valid to illustrate a point. Anarchists disagree. Yes, there is often
the need for abstraction in studying an economy or any other complex
system, but this is not an abstraction, it is propaganda and a
historical invention used not to illustrate an abstract point but rather
a specific system of power and class. That these little parables and
stories have all the necessary assumptions and abstractions required to
reach the desired conclusions is just one of those co-incidences which
seem to regularly befall economics.The strange thing about these
fictional stories is that they are given much more credence than real
history within economics. Almost always, fictional “history” will always
top actual history in economics.

If the actual history of capitalism is mentioned, then the defenders of
capitalism will simply say that we should not penalise current holders
of capital for actions in the dim and distant past (that current and
future generations of workers are penalised goes unmentioned).
However,the fictional “history” of capitalism suffers from no such
dismissal, for invented actions in the dim and distant past justify the
current owners holdings of wealth and the income that generates. In
other words, heads I win, tails you loose. Needless to say, this
(selective) myopia is not restricted to just history. It is applied to
current situations as well. Thus we find economists defending current
economic systems as “free market” regimes in spite of obvious forms of
state intervention. As Chomsky notes: “when people talk about ...
free-market ‘trade forces’ inevitably kicking all these people out of
work and driving the whole world towards a kind of a Third World-type
polarisation of wealth ... that’s true if you take a narrow enough
perspective on it. But if you look into the factors that made things the
way they are, it doesn’t even come close to being true, it’s not
remotely in touch with reality. But when you’re studying economics in
the ideological institutions, that’s all irrelevant and you’re not
supposed to ask questions like these.” [Understanding
Power]([Understanding_Power_\(Book\) "wikilink"), p. 260\]

To ignore all that and simply take the current distribution of wealth
and income as given and then argue that the “free market” produces the
best allocation of resources is staggering. Particularly as the claim of
“efficient allocation” does not address the obvious question:
“efficient” for whose benefit? For the idealisation of freedom in
and through the market ignores the fact that this freedom is very
limited in scope to great numbers of people as well as the consequences
to the individuals concerned by the distribution of purchasing power
amongst them that the market throws up (rooted, of course in the
original endowments). Which, of course, explains why, even if these
parables of economics were true, anarchists would still oppose
capitalism. We extend [Thomas Jefferson’s](Thomas_Jefferson "wikilink")
comment that the “earth belongs always to the living generation” to
economic institutions as well as political — the past should not
dominate the present and the future (Jefferson :“Can one generation bind
another and all others in succession forever? I think not.The Creator
has made the earth for the living, not for the dead. Rights and powers
can only belong to persons, not to things, not to mere matter un endowed
with will”).

For, as Malatesta argued, people should “not have the right ... to
subject people to their rule and even less of bequeathing to the
countless successions of their descendants the right to dominate and
exploit future generations.”\[At the Cafe, p. 48\] Then there is the
strange co-incidence that “value free” economics generally ends up
blaming all the problems of capitalism on workers. Unemployment?
Recession? Low growth? Wages are too high\! Proudhon summed up
capitalist economic theory well when he stated that "Political economy —
that is, proprietary despotism — can never be in the wrong: it must be
the proletariat.” [System of Economical
Contradictions]([System_of_Economical_Contradictions_\(Book\) "wikilink"),
p. 187\] And little has changed since 1846 (or 1776\!) when it comes to
economics “explaining” capitalism’s problems (such as the business cycle
or unemployment).

As such, it is hard to consider economics as “value free” when
economists regularly attack unions while being silent or supportive of
big business. According to neo-classical economic theory, both are meant
to be equally bad for the economy but you would be hard pressed to find
many economists who would urge the breaking up of corporations into a
multitude of small firms as their theory demands, the number who will
thunder against “monopolistic” labour is substantially higher
(ironically, as we note in section
[C.1.4](C.1.4_\(An_Anarchist_FAQ\) "wikilink"), their own theory shows
that they must urge the break up of corporations or support unions for,
otherwise, unorganised labour is exploited). Apparently arguing that
high wages are always bad but high profits are always good is value
free.

So while big business is generally ignored (in favour of arguments that
the economy works “as if” it did not exist), unions are rarely given
such favours. Unlike, say, transnational corporations, unions are
considered monopolistic. Thus we see the strange situation of economists
(or economics influenced ideologies like right-wing “libertarians”)
enthusiastically defending companies that raise their prices in the wake
of, say, a natural disaster and making windfall profits while, at the
same time, attacking workers who decide to raise their wages by striking
for being selfish. It is, of course, unlikely that they would let
similar charges against bosses pass without comment. But what can you
expect from an ideology which presents unemployment as a good thing
(namely, increased leisure — see section
[C.1.5](C.1.5_\(An_Anarchist_FAQ\) "wikilink")) and being rich as,
essentially, a disutility (the pain of abstaining from present
consumption falls heaviest on those with wealth — see section
[C.2.7](C.2.7_\(An_Anarchist_FAQ\) "wikilink")). Ultimately, only
economists would argue, with a straight face, that the billionaire owner
of a transnational corporation is exploited when the workers in his
sweatshops successfully form a union (usually in the face of the
economic and political power wielded by their boss).

Yet that is what many economists argue: the transnational corporation is
not a monopoly but the union is and monopolies exploit others\! Of
course, they rarely state it as bluntly as that. Instead they suggest
that unions get higher wages for their members be forcing other workers
to take less pay (i.e. by exploiting them). So when bosses break unions
they are doing this not to defend their profits and power but really to
raise the standard of other, less fortunate, workers? Hardly.In reality,
of course, the reason why unions are so disliked by economics is that
bosses, in general, hate them. Under capitalism, labour is a cost and
higher wages means less profits (all things being equal). Hence the need
to demonise unions, for one of the less understood facts is that while
unions increase wages for members, they also increase wages for
non-union workers.

This should not be surprising as non-union companies have to raise wages
stop their workers unionising and to compete for the best workers who
will be drawn to the better pay and conditions of union shops (as we
discuss in section [C.9](C.9_\(An_Anarchist_FAQ\) "wikilink"), the
neoclassical model of the labour market is seriouslyflawed).Which brings
us to another key problem with the claim that economics is “value free,”
namelythe fact that it takes the current class system of capitalism and
its distribution of wealth as notonly a fact but as an ideal. This is
because economics is based on the need to be able to
differentiatebetween each factor of production in order to determine if
it is being used optimally. In otherwords, the given class structure of
capitalism is required to show that an economy uses theavailable
resources efficiently or not. It claims to be “value free” simply
because it embeds theeconomic relationships of capitalist society into
its assumptions about nature.

Yet it is impossible to define profit, rent and interest independently
of the class structure of anygiven society. Therefore, this“type of
distribution is the peculiarity of capitalism. Under feudalismthe
surplus was extracted as land rent. In an artisan economy each commodity
is produced by a menwith his own tools; the distinction between wages
and profits has no meaning there.”This means that“the very essence of
the theory is bound up with a particular institution — wage labour. The
centraldoctrine is that ‘wages tend to equal marginal product of
labour.’ Obviously this has no meaning fora peasant household where
all share the work and the income of their holding according to the
rulesof family life; nor does it apply in a \[co-operative\] where, the
workers’ council has to decide whatpart of net proceeds to allot to
investment, what part to a welfare found and what part to distributeas
wage.”\[Joan Robinson,Collected Economic Papers, p. 26 and p. 130\]

This means that the “universal” principles of economics end up by making
any economy whichdoesnotshare the core social relations of capitalism
inherently “inefficient.” If, for example, work-ers own all three
“factors of production” (labour, land and capital) then the
“value-free” laws ofeconomics concludes that this will be inefficient.
As there is only “income”, it is impossible to saywhich part of it is
attributable to labour, land or machinery and, consequently, if these
factors arebeing efficiently used. This means that the “science” of
economics is bound up with the currentsystem and its specific class
structure and, therefore, as a“ruling class paradigm, the
competitivemodel”has the“substantial”merit that“it can be used to rule
off the agenda any proposals for25substantial reform or intervention
detrimental to large economic interests ... as the model allows (onits
assumptions) a formal demonstration that these would reduce
efficiency.”\[Edward S. Herman,“The Selling of Market Economics,”pp.
173–199,New Ways of Knowing, Marcus G. Raskin andHerbert J. Bernstein
(eds.), p. 178\]

Then there are the methodological assumptions based on individualism. By
concentrating onindividual choices, economics abstracts from the social
system within which such choices aremade and what influences them. Thus,
for example, the analysis of the causes of poverty is turnedtowards the
failings of individuals rather than the system as a whole (to be poor
becomes apersonal stigma). That the reality on the ground bears little
resemblance to the myth matters little— when people with two jobs still
fail to earn enough to feed their families, it seems ridiculousto call
them lazy or selfish. It suggests a failure in the system, not in the
poor themselves. Anindividualistic analysis is guaranteed to exclude, by
definition, the impact of class, inequality,social hierarchies and
economic/social power and any analysis of any inherent biases in a
giveneconomic system, its distribution of wealth and, consequently, its
distribution of income betweenclasses.This abstracting of individuals
from their social surroundings results in the generating eco-nomic
“laws” which are applicable for all individuals, in all societies,
for all times. This resultsin all concrete instances, no matter how
historically different, being treated as expressions ofthe same
universal concept. In this way the uniqueness of contemporary society,
namely its ba-sis in wage labour, is ignored (“The period through which
we are passing ... is distinguished by aspecial characteristic —
WAGES.”\[Proudhon,Op. Cit., p. 199\]).

Such a perspective cannot helpbeing ideological rather than scientific.
By trying to create a theory applicable for all time (andso, apparently,
value free) they just hide the fact their theory assumes and justifies
the inequal-ities of capitalism (for example, the assumption of given
needs and distribution of wealth andincome secretly introduces the
social relations of the current society back into the model, some-thing
which the model had supposedly abstracted from). By stressing
individualism, scarcity andcompetition, in reality economic analysis
reflects nothing more than the dominant ideologicalconceptions found in
capitalist society. Every few economic systems or societies in the
historyof humanity have actually reflected these aspects of capitalism
(indeed, a lot of state violence hasbeen used to create these conditions
by breaking up traditional forms of society, property rightsand customs
in favour of those desired by the current ruling elite).The very general
nature of the various theories of profit, interest and rent should send
alarmbells ringing. Their authors construct these theories based on the
deductive method and stresshow they are applicable ineverysocial and
economic system.

In other words, the theories arejust that, theories derived
independently of the facts of the society they are in. It seems
somewhatstrange, to say the least, to develop a theory of, say, interest
independently of the class systemwithin which it is charged but this is
precisely what these “scientists” do. It is understandablewhy. By
ignoring the current system and its classes and hierarchies, the
economic aspects ofthis system can be justified in terms of appeals to
universal human existence. This will raise lessobjections than saying,
for example, that interest exists because the rich will only part with
theirmoney if they get more in return and the poor will pay for this
because they have little choicedue to their socio-economic situation.
Far better to talk about “time preference” rather than thereality of
class society (see section C.2.6).Neoclassical economics, in effect,
took the “political” out of “political economy” by takingcapitalist
society for granted along with its class system, its hierarchies and its
inequalities.

This is reflected in the terminology used. These days even the term
capitalism has gone out of fashion,replaced with the approved
terms“market system,”the“free market”or“free enterprise.”Yet,as
Chomsky noted, terms such as“free enterprise”are used“to designate a
system of autocraticgovernance of the economy in which neither the
community nor the workforce has any role (a systemwe would call
‘fascist’ if translated to the political sphere).”\[Language and
Politics, p. 175\] As such,it seems hardly “value-free” to proclaim a
system free when, in reality, most people are distinctlynot free for
most of their waking hours and whose choices outside production are
influenced bythe inequality of wealth and power which that system of
production create.This shift in terminology reflects a political
necessity. It effectively removes the role of wealth(capital) from the
economy. Instead of the owners and manager of capital being in control
or,at the very least, having significant impact on social events, we
have the impersonal activityof“the markets”or“market forces.”That such a
change in terminology is the interest of thosewhose money accords them
power and influence goes without saying.

By focusing on the market,economics helps hide the real sources of power
in an economy and attention is drawn awayfrom such a key questions of
how money (wealth) produces power and how it skews the “freemarket” in
its favour. All in all, as dissident economist John Kenneth Galbraith
once put it,“\[w\]hateconomists believe and teach is rarely hostile to
the institutions that reflect the dominant economicpower. Not to notice
this takes effort, although many succeed.”\[The Essential Galbraith, p.
180\]This becomes obvious when we look at how the advice economics gives
to working classpeople. In theory, economics is based on individualism
and competition yet when it comes towhat workers should do, the “laws”
of economics suddenly switch. The economist will now denythat
competition is a good idea and instead urge that the workers co-operate
(i.e. obey) their bossrather than compete (i.e. struggle over the
division of output and authority in the workplace).

They will argue that there is“harmony of interests”between worker and
boss, that it is in theself-interest of workersnotto be selfish but
rather to do whatever the boss asks to furtherthebossesinterests (i.e.
profits).That this perspective implicitly recognises
thedependentposition of workers, goes withoutsaying. So while the sale
of labour is portrayed as a market exchange between equals, it is infact
an authority relation between servant and master. The conclusions of
economics is simplyimplicitly acknowledging that authoritarian
relationship by identifying with the authority figurein the relationship
and urging obedience to them. It simply suggests workers make the best
of itby refusing to be independent individuals who need freedom to
flourish (at least during workinghours, outside they can express their
individuality by shopping).This should come as no surprise, for, as
Chomsky notes, economics is rooted in the notion that“you only harm the
poor by making them believe that they have rights other than what they
can winon the market, like a basic right to live, because that kind of
right interferes with the market, andwith efficiency, and with growth
and so on — so ultimately people will just be worse off if you try
torecognise them.”\[Op. Cit., p. 251\]

Economics teaches that you must accept change without regardto whether
it is appropriate it not. It teaches that you must not struggle, you
must not fight. Youmust simply accept whatever change happens. Worse, it
teaches that resisting and fighting backare utterly counter-productive.
In other words, it teaches a servile mentality to those subject
toauthority. For business, economics is ideal for getting their
employees to change their attitudesrather than collectively change how
their bosses treat them, structure their jobs or how they arepaid — or,
of course, change the system.27Of course, the economist who says that
they are conducting “value free” analysis are indif-ferent to the kinds
of relationships within society is being less than honest. Capitalist
economictheory is rooted in very specific assumptions and concepts such
as “economic man” and “per-fect competition.” It claims to be
“value-free” yet its preferred terminology is riddled with
valueconnotations. For example, the behaviour of “economic man” (i.e.,
people who are self-interestedutility maximisation machines) is
described as“rational.”

By implication, then, the behaviour ofreal people is“irrational”whenever
they depart from this severely truncated account of humannature and
society. Our lives consist of much more than buying and selling. We have
goals andconcerns which cannot be bought or sold in markets. In other
words, humanity and liberty tran-scend the limits of property and, as a
result, economics. This, unsurprisingly, affects those whostudy the
“science” as well:“Studying economics also seems to make you a nastier
person. Psychological studieshave shown that economics graduate students
are more likely to ‘free ride’ — shirk con-tributions to an experimental
‘public goods’ account in the pursuit of higher privatereturns — than
the general public. Economists also are less generous that other
aca-demics in charitable giving. Undergraduate economics majors are more
likely to defectin the classic prisoner’s dilemma game that are other
majors.

And on other tests, stu-dents grow less honest — expressing less of a
tendency, for example, to return foundmoney — after studying economics,
but not studying a control subject like astronomy.“This is no surprise,
really. Mainstream economics is built entirely on a notion of
self-interested individuals, rational self-maximisers who can order
their wants and spendaccordingly. There’s little room for sentiment,
uncertainty, selflessness, and social insti-tutions. Whether this is an
accurate picture of the average human is open to question,but there’s no
question that capitalism as a system and economics as a discipline
bothreward people who conform to the model.”\[Doug Henwood,Wall Street,
p, 143\]So is economics “value free”? Far from it. Given its social
role, it would be surprising that itwere. That it tends to produce
policy recommendations that benefit the capitalist class is notan
accident. It is rooted in the fibre of the “science” as it reflects the
assumptions of capitalistsociety and its class structure. Not only does
it take the power and class structures of capital-ism for granted, it
also makes them the ideal for any and every economy.

Given this, it shouldcome as no surprise that economists will tend to
support policies which will make the real worldconform more closely to
the standard (usually neoclassical) economic model. Thus the modelsof
economics become more than a set of abstract assumptions, used simply as
a tool in theoreti-cal analysis of the casual relations of facts. Rather
they become political goals, an ideal towardswhich reality should be
forced to travel.This means that economics has a dual character. On the
one hand, it attempts to prove thatcertain things (for example, that
free market capitalism produces an optimum allocation of re-sources or
that, given free competition, price formation will ensure that each
person’s incomecorresponds to their productive contribution). On the
other, economists stress that economic“science” has nothing to do with
the question of the justice of existing institutions, class struc-tures
or the current economic system. And some people seem surprised that this
results in policyrecommendations which consistently and systematically
favour the ruling class