The Anti-Veblen

It is curious that both Thorstein Veblen and Tyler Cowen were/are economists. Judged by their interests, they might have been psychologists, sociologists, or anthropologists, especially the last. The Theory of the Leisure Class was pure anthropology. Tyler’s new book Discover Your Inner Economist is a blend of psychology and anthropology. Veblen wrote a whole book arguing what Tyler (rightly) takes as needing little support. “Cookbooks by famous chefs . . . seek to impress rather than respect our limits,” writes Tyler. Straight out of Theory of the Leisure Class except better written.

In book after book, Veblen criticized mainstream economics. The mainstream economists of his time liked to assume that everyone “maximized utility”; the point of Theory of the Leisure Class was how wrong this was — all that conspicuous waste and consumption and impracticality done to signal one’s wealth. Whereas Tyler’s theme is essentially the opposite: mainstream economic ideas, which now include Veblen’s, explain a lot about everyday life, such as which countries have the best restaurants. U. N. troops were “very good for the people who sell lobster,” a Haitian taxi driver told him.

Whereas Veblen expressed his dissatisfaction in the usual academic way — he wrote a book saying this is bad, that is bad (very creatively and thematically) — Tyler did something far less predictable and probably far more powerful: With Alex Tabarrok, he started a blog. The main theme of Marginal Revolution, as far as I can tell, is to praise stuff (usually academic economic stuff) that Tyler believes is or is likely to be under-appreciated. Greg Clark’s new book is an example. Stories teach values, and MR is a long-running serial with “recurring characters” (to quote Tyler). To criticize by creating is as old as Michaelangelo but requires a willingness to start small and deal with small things (such as a tiny restaurant) that doesn’t come easily to academics in prestigious positions.

Modern Veblen: Determinants of Conspicuous Consumption

At Marginal Revolution, Alex Tabarrok has an interesting post about black/white differences in what Thorstein Veblen called conspicuous consumption. It begins:

Several years ago Bill Cosby chided poor blacks for spending their limited incomes on high-priced shoes and other items of conspicuous consumption instead of investing in education.

The comments are fascinating, including this:

Merely being white is a way of signaling wealth. If you don’t believe it, visit Peru.

The View From MIT

I have blogged many times about the problems with UC Berkeley’s undergraduate education (here, here, and here, for example). For all the conventional talk about “the value of diversity”, I never see recognition of diversity of interests and diversity of skills. Everyone in a class is taught the same material (and expected to be interested in the same stuff as the professor); and everyone is graded the same way (and expected to imitate the professor). Of course, UC Berkeley is hardly unique. Practically all higher education works this way, more or less. Berkeley is just the example I know. It is a particularly egregious example given the diversity of vocational interests among its students (much more diverse than Caltech, say), its status as a public institution (with a charter to serve the public rather than its professors), and the exceptionally high research focus of its professors (making them even less interested in what students want).

At a school like Caltech or MIT, the talents of the students are closer to the talents of the professors, but I heard David Brin, the novelist, complain that after he finished Caltech with a low GPA he felt like a worthless human being. Caltech and MIT, like Berkeley, also fail to teach their students about the outside world. From an MIT professor:

Most of the sweeping generalizations one hears about MIT undergraduates are too outrageous to be taken seriously. The claim that MIT students are naive, however, has struck me as being true, at least in a statistical sense. [Could the MIT faculty have anything to do with this?] Last year, for example, one of our mathematics majors, who had accepted a lucrative offer of employment from a Wall Street firm, telephoned to complain that the politics in his office was “like a soap opera.” More than a few MIT graduates are shocked by their first contact with the professional world after graduation. There is a wide gap between the realities of business, medicine, law, or applied engineering, for example, and the universe of scientific objectivity and theoretical constructs that is MIT.

It’s Veblen again: MIT professors would rather teach “scientific objectivity and theoretical constructs” than “the [dirty] realities” of the world in which their students will spend the rest of their lives. Law schools, especially elite ones, are notoriously like this: To teach how to practice law is beneath the dignity of their professors.

Modern Veblen: The Less-Than-Obvious Value of Evolutionary Explanations

An interesting Economist article about sex differences in a visual task calls an evolutionary explanation a “just-so story.” I don’t know if the late Stephen Jay Gould, evolutionary theorist, Harvard professor, and “one of the most influential and widely-read writers of popular science of his generation” (Wikipedia), invented this form of dismissal, but certainly he was fond of it. Here, for example:

Evolutionary biology has been severely hampered by a speculative style of argument that . . . tries to construct historical or adaptive explanations for why this bone looked like that or why this creature lived here. These speculations have been charitably called “scenarios”; they are often more contemptuously, and rightly, labeled “stories” (or “just-so stories” if they rely on the fallacious assumption that everything exists for a purpose). Scientists know that these tales are stories; unfortunately, they are presented in the professional literature where they are taken too seriously and literally.

Well, this is seriously wrong. My work contains several just-so stories — evolutionary explanations of the morning-faces effect and of the mechanism behind the Shangri-La Diet, for example. My theory of human evolution might be called a just-so saga.

These explanations made me (at least) believe more strongly in the result or theory they explained — which turned out to be a good thing. My morning-faces result was at first exceedingly implausible. The evolutionary explanation encouraged me to study it more. After repeating it hundreds of times I no longer need the evolutionary explanation to believe it but the explanation may help convince others to take it seriously. The evolutionary explanation connected with the Shangri-La Diet had the same effect. My evolutionary explanation of the effect of breakfast on sleep led me to do the experiment that discovered the morning-faces effect. My theory of human evolution led me to try new ways of teaching, with good results.

Why did Gould make this mistake? Thorstein Veblen wrote about our fondness for “invidious comparisons.” We like to say our X is better than someone else’s X. Sure, evolutionary explanations may be hard to test. That doesn’t mean they’re worthless. Like many scientists, Gould failed to grasp that something is better than nothing.

Addendum: Perhaps the Economist writer had read a recent Bad Science column that began:

I want you to know that I love evolutionary psychologists, because the ideas, like “girls prefer pink because they need to be better at hunting berries” are so much fun. Sure there are problems, like, we don’t know a lot about life in the pleistocene period through which humans evolved; their claims sound a bit like “just so” stories, relying on their own internal, circular logic; the existing evidence for genetic influence on behaviour, emotion, and cognition, is coarse; they only pick the behaviours which they think they can explain while leaving the rest; and they get themselves in massive trouble as soon as they go beyond examining broad categories of human behaviors across societies and cultures, becoming crassly ethnocentric.

“They only pick the behaviours which they think they can explain” — how dare they!

Modern Veblen: Flight From Data

I read The Theory of the Leisure Class by Thorstein Veblen during college and was very impressed. One of the book’s main points is that wealthy people advertise their avoidance of “dirty” work. Long fingernails on women. Obscure and elaborate phrases in academic articles. “The advantage of the accredited locutions lies in their reputability; they are reputable because they are cumbrous and out of date, and therefore argue waste of time and exemption from the use and the need of direct and forcible speech,” wrote Veblen.

A friend of mine does research for an oil company. Several years ago, the oil company he worked for (Company X) was bought by another oil company (Company Y), which merged their research departments. Company X’s research group moved to the research campus of Company Y. Following the move, each Company X researcher was asked to give a talk about his recent work. My friend wrote an abstract for his talk. The seminar coordinator — from Company Y — came into my friend’s office with his abstract and said to him, “Could you deemphasize the parts involving real data? We don’t deal with real data here.”

This was true. The Company Y researchers included many theorists, heavily into abstruse mathematical models. Others were coding new algorithms and relied on model “data” for testing, but not actual data. In contrast, many of Company X’s researchers, including my friend, “got their hands dirty.” After my friend’s talk, several people told him how nice it was to hear about real data.

You can see this tendency everywhere at UC Berkeley, from English to Statistics to Engineering to Psychology. Disciplines that began closely connected with reality and everyday concerns moved farther and farther away. A few days ago someone complained to me about a class where students graded each other’s papers. That’s academia, I said.

Modern Veblen: Theory Testing.

Modern Veblen: Theory Testing

In 2000, Hal Pashler and I published a paper called “How persuasive is a good fit? A comment on theory testing.” For more than 50 years, psychologists had supported mathematical theories by showing that the equations of the theory could fit data. We pointed out that this was a mistake because no account was taken of the flexibility of the theory. A too-flexible theory can fit anything. However obvious this may sound to outsiders, the practice we criticized was common (and continues).

Recently I asked Hal: Is the problem we pointed out an example of something more general? Neither Hal nor I had a good answer to this. Both of us thought the practice we had criticized was what Feynman called cargo-cult science — looks like science but isn’t — but that was more of a derogatory description than anything else.

Now I think I have a helpful answer: What we pointed out was an example of the general point Thorstein Veblen made in The Theory of the Leisure Class: The growth of worse-than-useless practices among the well-off. Foot-binding. Hood ornaments. Long words and bad writing in scholarly articles. Conspicuous waste. The last chapter of Veblen’s book is about academia.