Winnetou, a sophomore majoring in economics, at first chose to major in economics because he was keen to learn more about economic phenomena. However, upon undertaking the major, he was astounded to see the amount of mathematics required in the major.
That much sums up the current state of economic programs and modules. Any economics student will tell you that the subject they study the most is mathematics. The reason for this is that, since the late nineteenth century, there has been a desire to take economics to the level of science, comparable to physics. Most of this was accomplished through the quantification of economic events and their explanation through charts and graphs.
Mathematics is surely useful for economics, but it's not everything. Thus, there have been growing concerns about the overuse of mathematics in economics. Has economics always been full of mathematics? Is economics supposed to be math-heavy? How much should mathematics be used in economics? This essay aims to answer these questions by looking at the theories and empirical evidence.
Has it Always Been This Way?
A.A. Cournot, a French economist, mathematician, and philosopher, pioneered the mathematical transformation of economics in 1838. Two notable examples are Leon Walras in1874, and Vilfredo Pareto in1909, who figured out the parameters of "general equilibrium" numerically. Alfred Marshall was a major figure in promoting quantitative economics, although he restricted his own equations and even graphics to appendices, preferring to deliver his results verbally.
The late nineteenth-century work of W. Stanley Jevons provided a major push for the mathematical method. Jevons informed fellow economists in his foreword to the second edition of The Theory of Political Economy that "their profession can be adequately presented only on a clearly mathematical foundation." Jevons went even farther, claiming that "all economic authors must be mathematical in the sense that they deal with economic quantities and their connections, and all numbers and their interactions fall within the realm of mathematics." (1965, Jevons).Â
Then, in the 1930s, the Keynesian revolution happened. Economics had undergone a major revolution. The verbal, logical technique was largely supplanted by extensive use of graphs, mathematics, and statistics. Today, the bulk of economists are engrossed with the building of economic models in the manner of classical mechanics, which incorporate a plethora of intricate numerical correlations. Just a tiny number of unconventional economists, primarily proponents of the "free market," have expressed substantial challenges to this technique.Â
Mathematics has unquestionably benefited economics. Mathematics enables economists to conduct quantitative experiments and develop models for forecasting future economic development. Mathematical models have aided economists in establishing links between variables and analyzing their logic.
It is Unmeasurable
Some of the early skeptics of mathematical approaches argued that economic variables are intrinsically qualitative and hence unmeasurable. Political economy deals with intangible ideas such as utility, desire, want, welfare, and preference. It is dubious to attempt to quantify these mostly subjective and qualitative elements. On these grounds, J. B. Say, a prominent nineteenth-century French economist, was opposed to the use of mathematical and statistical methods in economics (Menard, 1980).Â
