'The Clinical-Bench Science Distinction in Macro'
In response to this from Paul Romer:
The Clinical-Bench Science Distinction in Macro: I had hoped to find time to offer a more thoughtful response to Simon Wren Lewis’s most recent comments on the way forward in macroeconomics...
For now, I’ll go ahead with what I hope is a suggestion that could encourage some kind of consensus:
Perhaps the discussion about macro would benefit from a distinction like the one in biomedicine between bench science and clinical work.
In my interpretation, what Lucas and Sargent were trying to do in the 1970s was to develop the bench science side of macroeconomics. ...
Lucas (1972) got things off to a very promising start. It offered both a technical advance–a tractable way to introduce uncertainty and expectations–and an initial conjecture about the fundamental imperfection–incomplete information. It also boasted prematurely about new insights into policy. If at this time, we had already established the distinction between bench science and clinical practice, this might have been recognized as harmless obiter dicta.
Assuming the profession can get back to generally sensible bench science inquiry into the basic scientific questions of macroeconomics (and of course, there were economists who kept doing good bench science on macro questions far away from the RBC reality distortion field), we could copy the quid-pro-quo that prevails in biomedicine: Bench scientists get the freedom to explore any question they want. In return, when they get a result that they think might have implications for clinical practice, the bench-scientists can’t just try to pull rank and order the clinicians to change to some new clinical protocol.
The bench scientists have to persuade other bench scientists first. Then the bench scientists together have to persuade the clinicians, and this will not in general, be an easy task. For every important bench-science insight (e.g. that clinicians should wash their hands, or that you can treat ulcers with antibiotics) there are countless episodes in which the bench scientists persuaded each other that they were onto something really big that turned out to be a whimper or simply wrong. ...
So the clinicians are going to be appropriately skeptical. This will irritate the bench scientists, but so what. ...
I'll offer this old Reuters column of mine, A great divide holds back the relevance of economists, on the same topic (from 2011, with links to responses by Summers, Krugman, Hamilton, and Baker among others -- they don't all agree -- full list of responses here). My point, in part, was that causality shouldn't run only from "bench scientists" to practitioners (who then, according to the above, should be free to accept or reject the advice of theorists). The "bench research" should also be informed by the needs of practitioners. That increases the likelihood that theorists will address the most important questions faced by the practitioners, and hence that the research will be useful. That doesn't mean that theorists shouldn't entertain questions with no obvious application, some important discoveries are made in that way. But the theorists should at least consider the needs of the practitioners when deciding which questions are the most important, and most in need of answers.
Posted by Mark Thoma on Tuesday, September 1, 2015 at 01:11 AM
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