In Search of the Two-Handed Economist by Craig Freedman

Author:Craig Freedman
Language: eng
Format: epub
Publisher: Palgrave Macmillan UK, London

His attention to the details of marketing his position thus starts early on in his career. The goal ultimately is to influence a debate by shifting its grounds, in effect reconceptualizing the issues and transporting them to more congenial territory. Success allows a hardened campaigner to then guide, to a certain degree, the direction of any further debate. Following this strategy often required Stigler to employ tactics more familiar in legal briefs, where every potential precedent and decision obliquely relevant to a case is dredged up on the off-chance that something will somehow stick. Thus, as in many of his subsequent critical papers, Stigler delivers a number of jabs from several different directions in the hope that landing some combination of these will at least grant him a technical knockout.

If anything, the article’s title misleads, leaving the potential reader unprepared for the argument to follow. It is difficult to conceive how a theory can be effectively generalized by categorizing it as no more than an appendage to what Stigler clearly identifies as the universal approach that must underlie any serious attempt at economic science. The paper is in essence a defense of perfect competition. In other words, Stigler enrols himself unreservedly in the ranks of the army whose banners have been clearly unrolled by Generals Knight and Simons. Mobilizing an effective defense, however, often requires a strategic attack. The initial step in undermining a heretical challenge to orthodox beliefs is to treat alternatives to perfect competition as nothing more than a generic amalgam carelessly labelled imperfect competition. The term is firmly anchored to the standard approach by identifying it as simply a deviation from what is essentially still the core theory of economics. In which case, what is on offer is presented not as an alternative starting point for analysis, such as that offered by Chamberlin, but rather a theory that presupposes perfect competition.92 Arriving at the end of Stigler’s guided journey, the reader is left awaiting a promised generalization which has emphatically failed to materialize.

A careful examination of the article through the lens of a skeptical perspective shows Stigler apparently tipping his hand throughout his analysis. He yokes this new theory to the old by stating categorically “All students of imperfect competition have accepted, either explicitly or by their practice, the received theory of competition as the point of departure, and this is of course both desirable and inevitable” (Stigler 1937:710). Such a sweeping statement directly contradicts what Chamberlin is trying to accomplish, if we take him at his word—and even more so if we even-handedly evaluate his theory. Such a charge reduces Chamberlin to someone who is either unaware (self-delusional) or deliberately evasive. The type of all-encompassing generality Stigler commits is difficult, if not impossible, to refute because it is always possible to argue that a theory reflects a previous one even if such analysis is constructed as a deliberate alternative. Stigler here is strategically placing opponents on the back foot by putting them on the defensive.

Stigler essentially

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