What does it mean to use “the economic approach” to thinking about the world?
In the old days, if you asked 100 people this question, I bet at least 80 of them would have given some kind of answer having to do with dollars and cents, supply and demand, etc.
Over the past few decades, however, “the economic approach” has come to mean something far broader. We are grateful practitioners of this movement, the godfather of which is almost inarguably Gary Becker, Levitt’s U. of Chicago colleague and a man who has shown up on this blog repeatedly, most recently for winning the Presidential Medal of Freedom. (He also blogs.)
I was reminded of this the other day while rereading Becker’s book, The Economic Approach to Human Behavior. In the introduction, he beautifully describes what he means by “the economic approach,” and includes an example that seems so brazen at first that it may take your breath away — but after a moment, it makes perfect sense, and you see why Becker’s way of thinking is so unusual and so valuable. See for yourself:
Indeed, I have come to the position that the economic approach is a comprehensive one that is applicable to all human behavior, be it behavior involving money prices or imputed shadow prices, repeated or infrequent decisions, large or minor decisions, emotional or mechanical ends, rich or poor persons, men or women, adults or children, brilliant or stupid persons, patients or therapists, businessmen or politicians, teachers or students … Subsequently, I applied the economics approach to fertility, education, the uses of time, crime, marriage, social interactions, and other “sociological,” “legal,” and “political” problems … Good health and a long life are important aims of most persons, but surely no more than a moment’s reflection is necessary to convince anyone that they are not the only aims: somewhat better health or a longer life may be sacrificed because they conflict with other aims … According to the economic approach, therefore, most (if not all!) deaths are to some extent “suicides” in the sense that they could have been postponed if more resources had been invested in prolonging life.
In addition to regularly being floored by Becker’s thinking, I am also enamored of his writing. I particularly enjoy his use of parentheticals and exclamation points. (It conveys both passion and informality!)
and 
. You can also watch it on 
Silvanus, Becker says that an economic approach is a comprehensive one that is applicable to all human behavior. He never says (or even implies, in my opinion) that he thinks it is the sole way it should be looked at. I don’t think he was trying to discredit the validity or value of medical/psychological approaches. I think that what he was saying is that an economic approach is valuable one and can produce intriguing data that provides insights into human behavior that other methods would never uncover.
Silvanus, Becker says that an economic approach is a comprehensive one that is applicable to all human behavior. He never says (or even implies, in my opinion) that he thinks it is the sole way it should be looked at. I don’t think he was trying to discredit the validity or value of medical/psychological approaches. I think that what he was saying is that an economic approach is valuable one and can produce intriguing data that provides insights into human behavior that other methods would never uncover.
I’m with Silvanus- this is like the ivory tower syndrome, where academics think that everything is reducible to their field- so at MIT, they argue it’s all physics; while the Marxists say it’s all economics; the shrinks say it’s all psychology; or chemistry, etc.- if I had to pick, I would say psychology is the preeminent matrix by which most phenomena are reduced to; economics is probably one of the more limited fields for explaining human behavior
I’m with Silvanus- this is like the ivory tower syndrome, where academics think that everything is reducible to their field- so at MIT, they argue it’s all physics; while the Marxists say it’s all economics; the shrinks say it’s all psychology; or chemistry, etc.- if I had to pick, I would say psychology is the preeminent matrix by which most phenomena are reduced to; economics is probably one of the more limited fields for explaining human behavior
Silvanus makes an excellent point!
” … most (it not all!) deaths are to some extent “suicides” … ” WOW! So the family in Connecticut (I believe that is where it happened) that was brutally raped, beaten and killed was some how self inflicted death? Or the 3000+ people that went to work, or boarded a plane on 9/11 was someone, in some way responsible for their own deaths? How about the millions in Darfur that are murdered?
Seriously, this is just silly. I am sure Becker thinks he came to some great connectedness theory here, and perhaps the single paragraph you provided does not give it justice but this conclusion is pure crap.
Silvanus makes an excellent point!
” … most (it not all!) deaths are to some extent “suicides” … ” WOW! So the family in Connecticut (I believe that is where it happened) that was brutally raped, beaten and killed was some how self inflicted death? Or the 3000+ people that went to work, or boarded a plane on 9/11 was someone, in some way responsible for their own deaths? How about the millions in Darfur that are murdered?
Seriously, this is just silly. I am sure Becker thinks he came to some great connectedness theory here, and perhaps the single paragraph you provided does not give it justice but this conclusion is pure crap.
This is completely offensive to anyone who knows a child with cancer, or the victim of a random crime/accident, or someone who’s suffered with a genetic disease their whole lives . . .
It’s what I don’t understand about the hard-line personal responsibility argument one often hears libertarians and conservatives make.
Becker’s idea is an interesting thought experiment that might have some value when speaking on the topic of eating healthfully, or choosing to not do stupid things.
But when he extends it (and others thoughtfully ruminate on such an extension) to “most” deaths (if not all!!) being essentially suicides, it really strikes me as taking the ‘freedom’ and ‘personal responsibility’ philosophies unrealistically far.
(I’m not sure if there’s a libertarian connection here, but I seem to be making it, my apologies if it’s in error. But I have similar problems with this idea, and the economic side of libertarianism. Kind of like how I’ve never met a poor, or severely underprivileged, libertarian. Easy to decry the bad parts of government (and laud freedom) when you’re not in need of the benefits of government and cannot take advantage of those freedoms.)
This is completely offensive to anyone who knows a child with cancer, or the victim of a random crime/accident, or someone who’s suffered with a genetic disease their whole lives . . .
It’s what I don’t understand about the hard-line personal responsibility argument one often hears libertarians and conservatives make.
Becker’s idea is an interesting thought experiment that might have some value when speaking on the topic of eating healthfully, or choosing to not do stupid things.
But when he extends it (and others thoughtfully ruminate on such an extension) to “most” deaths (if not all!!) being essentially suicides, it really strikes me as taking the ‘freedom’ and ‘personal responsibility’ philosophies unrealistically far.
(I’m not sure if there’s a libertarian connection here, but I seem to be making it, my apologies if it’s in error. But I have similar problems with this idea, and the economic side of libertarianism. Kind of like how I’ve never met a poor, or severely underprivileged, libertarian. Easy to decry the bad parts of government (and laud freedom) when you’re not in need of the benefits of government and cannot take advantage of those freedoms.)