“The Reluctant Economist” is a set of essays that is cross-sectional in more ways than one. First, it cuts across several decades of Richard A. Easterlin's own research. Most of the included works have been published elsewhere—about half since 1995 but some earlier pieces are also included. Second, the book draws on a wide range of disciplines, including economics, sociology, public health, psychology, and history. Third, the research problems tackled represent a cross-section of some of the most intriguing and important questions that the social sciences strive to answer: what causes growth and what stagnation, why people are healthier (yet not happier) than in the past, how people's family life interacts with their professional life, and so on. And although each article offers a well-argued answer to its specific research problem, the tenor of the articles (and of the autobiographical introductory essay from which the book takes its title) indicates that the ulterior motive of this publication is to make several important methodological points. After all, it is the reservations about the methodology in economics that makes Easterlin a reluctant economist.
This reluctance takes the form of reasoned objections against some of the basic assumptions that permeate a large fraction of economic research. These include the strong preference for free markets (and its usual corollary of distrust of government), the assumed fixity of preferences, the undisputed positive relationship between consumption/income and personal satisfaction, and others.
Ideologues of all stripes will surely dislike this book. One clear impression emerging from its pages is that, in most cases, reality does not neatly fit into a one-size-fits-all, simple framework. Easterlin argues, for example, that the secular improvements in material well-being and the secular improvements in health come from different sources (economic growth versus public health policy), are based on a different kind of technology (physical versus medical knowledge) and developed thanks to different institutional incentives (free market versus public sector activity). This non-ideological manner shows in the overall approach, too. In contrast to the oft-adopted research strategy whereby a sophisticated model is designed to explain a few stylized facts, Easterlin prefers to apply broadly formulated, “stylized,” explanations to carefully scrutinized empirical observations. The book seeks to be “more accessible to the non-specialist” (p. xvii), so high-grade math is mostly absent, but the author is unforgiving in requiring readers to investigate the numerous tables and graphs that anchor the analysis.
Easterlin shows that by relaxing certain standard assumptions that are commonplace in economics he can shed light on some puzzling issues. But at the same time, there seems to be a danger of taking the idea too far. Consider the use of subjective testimony. Chapters 2 and 3 are devoted to questions concerning personal happiness, lifetime goals and expectations, material aspirations, and career choice. All are areas where questionnaire surveys can be of help. Does this helpfulness go so far as to make subjective testimony one of the methodological cornerstones in economics? “It seems to me,” Easterlin writes, “that an economics model is fundamentally flawed if its presumed cause-effect relations are belied by the subjective testimony of the agents” (p. xvi). I am not so sure, as subjective polls and surveys can be treacherous. Numerous studies show, for example, that people often perceive themselves as smarter, prettier, wiser, and more charitable than they actually are and relative to the rest of the population. Talk is cheap; and seeing humankind as the lying and self-flattering lot that we are, economists prefer to “follow the money” rather than to heed vox populi. If an economics model is “belied by the subjective testimony,” it could be a bad model but it also could be that agents do not put their money where their mouths are, in which case it does make sense to treat opinion surveys with suspicion.
I also happen to think that Easterlin's enthusiasm for government policy in bringing about the mortality revolution could be more nuanced. Stating the problem in terms of a dichotomy of free market versus government policy may be an oversimplification. It seems to ignore that large part of a community's life that is neither “for-profit” nor government policy and is usually referred to as civil society. Reading between the lines of Easterlin's account of the mortality revolution (chapters 6 and 7), I sense that a substantial portion of it was due to the citizens' mutual education, campaigning, and gradually changing socialization in matters of food handling, personal hygiene, and so on. After all, governments can legislate compulsory inoculation, but they can scarcely enforce regular brushing of teeth and washing of hands.
This is a thoroughly enjoyable book. It addresses a wide range of topics in a readable, lively style; it offers many interesting insights and presents some remarkable facts. Equally well expressed is the author's polemic with the prevailing understanding of how the economic science should be done. Ultimately, I perceive Easterlin's book as an open-ended offer—if the economic profession would become more broad-minded, he would become a less reluctant economist.
