By Pavel Kuchar and Erwin Dekker

In a recent Economics Network survey, almost three quarters of UK respondents said they thought that understanding economics is relevant to everyday life. However, trust in professional economists is not as high and seems to vary depending on political preferences. For instance, in 2019 over half of pro-Brexit voters expressed distrust of the economists’ opinions on the functioning of the world economy, while conversely only 23% of Remainers expressed distrust in economic experts.

When asked about what economists do, most respondents (close to two thirds of them) thought that the bread and butter of an economist is forecasting, while only about one fifth of respondents thought that economists try to understand how economies work. When asked to name an actual economist only 16 percent were able to do so. Those respondents that did name an economist had in mind famous economic journalists, or bankers, not academic economists.

At the same time, economists do not seem to have a particularly high opinion about the lay public.  Speaking of the public’s understanding of economics, Lee Hansen wrote that “everyone judges it to be low.” Discussing the arguments for free international trade, Paul Krugman boldly stated that “economists are basically right and the general public basically wrong.” Bryan Caplan generalized this claim and suggested that “laypeople and experts systematically disagree” in their views of economic issues.

A study on “Bridging the Gap between the Public’s and Economists’ Views of the Economy” published in the Journal of Economic Perspectives reached a conclusion that “economists need to do a better job educating the public about economic matters and spend more time communicating the implications of their research to the public.” In fact, adds Krugman, “our primary mission should be to vaccinate the minds” of people so as to eradicate “the misconceptions that are so predominant in what passes for educated discussion about international trade.”

The proposed remedy for this gap in popular economic knowledge thus seems to be to “communicate economics” better. Since the public is often ignorant or at best poorly informed about economics, economic principles must be taught earlier, more extensively, or must simply be taught more effectively. The primary concern in Western democracies is that until the public becomes better informed, the layman cannot be trusted in its role as citizen judging economic policies. Indeed, some might argue that these judgments are better left to experts.

While the gap between the expert and lay understanding of ordinary business of life has often been attributed to cognitive biases, self-serving beliefs, ignorance, or plain irrationality, our recent working paper argues that it results from a deliberate break that exists between everyday and scientific economic knowledge. This gap between popular understanding of the economics of everyday life and economists’ social scientific expertise is sometimes referred to as an “epistemological break”.

Some have praised the epistemological break (Gaston Bachelard called it the “rupture épistémologique”) as one of the fundamental characteristics of modern science. Real scientific insight and understanding, the argument goes, can only be gained if the scientist is willing to do away with, or rather to overcome, everyday knowledge. Scientific thought only progresses by uncovering hidden truths about the way the world works; experiential knowledge from everyday life, like ideology, are obstacles that stand in the way of science. Bachelard proposed that since “nothing can be founded on opinion: we must start by destroying them.”

The Marxist theorist Louis Althusser extended this idea to social sciences. The fundamental break thus emerged in Marxist social theory between the alienated worldview of social and economic actors and the objective worldview of the analyst, who can expose the exploitation and the alienation of those living in society. The social scientist is thus placed in a privileged position from which he or she can uncover or expose the causes of social alienation, using their insight to see through the illusions that dominate everyday understandings of the world.

The epistemological break has not merely resulted in a distinct language of economists and the public, it also helped produce a particular understanding of the relation between economic experts and the society in general. In this view the experts have superior access to knowledge, and the relevant test of the economic knowledge of the public is by measuring how much of this scientific economic knowledge non-experts possess.

Could it be the case that to communicate economics the economist needs to learn how to better listen instead of becoming more eloquent? If so, the fundamental challenge might be not a better talking down to the “uneducated layman” but rather a translation between different types of knowledge, and the search for convergence between them.

Indeed, it may make more sense to begin from the premise that both the public and economists hold valuable knowledge about the economy, although typically of a different kind. If we do grant this premise, then the challenge of bridging the epistemic gap is to create a meaningful engagement between different types of knowledge rather than merely improving economic education through better “communicating economics”.

Undoing the epistemological break in economics is a difficult undertaking. It requires rethinking the more fundamental assumptions underlying the discipline. But writers such as Deirdre McCloskey, who has herself been in search for a more humane and liberal economics, have contributed to closing the gap between the everyday and the expert knowledge. In order to close this break, McCloskey argued in her Rhetoric of Economics and If You Are So Smart, expert knowledge must be taken down from its pedestal and the elevated economic expert needs to be brought down to earth.

Her more recent trilogy on the bourgeois virtues, dignity, and equality made the case for elevating the status of everyday knowledge. The “bourgeois knowledge” McCloskey examined was not exclusively practical, in fact, the “prudence-only” ethic, which economists often assume drives the maximizing behavior of economic agents, became her primary target here. According to McCloskey, the seventeenth century European bourgeoisie was different because of their ethic, which distinguished it from both the aristocracy, with its honor codes and focus on non-economic forms of prestige, and it was also different from the so called homo economicus devoid of moral sensibilities beyond prudence. The bourgeois knowledge McCloskey praised was essentially moral knowledge, about what was right to pursue, and how to pursue it.

McCloskey’s calls to pay attention to the figures of speech the economist and the ordinary bourgeois use are invaluable. They helped the profession reorient its focus and start paying attention to the narratives through which seventeenth century bourgeoisie sought to alter commercial, scientific, and civic discourse. However, if we stop here, we argue, the closure of the epistemological break will be incomplete.

The anthropocene has consistently managed to lift billions of people out of material poverty. McCloskey vividly illustrates that “the market-tested betterment” alleviated the plight of the poor and has increased incomes by orders of magnitude, a fact which partly due to her work is now gaining recognition in various works of popular science. Denials of that fact are denials of historical evidence.

But such denials are different from internal critiques of further effects these changes have had.

Dismissive attitudes toward these critiques block off an attempt to take seriously the motivations and knowledge of those who feel left behind by globalization. If we ought to respect the knowledge of the ordinary bourgeois, why not pay attention to the diverse knowledge of the proletariat? Indeed, even if laypeople sometimes adopt economic beliefs that most economists believe are counterproductive, should we not at least address them with more respect?

We suggest that economics needs to take the everyday denunciations of unresponsive landlords, of exploitative employers, greedy CEOs, and corporate bailouts seriously. These concerns may lead to serious and valid critiques of how contemporary economies are organized. In this sense we agree with McCloskey’s spirit of liberalism: “If ever there was a time to let people go, and to have a go, it is now, when they are so obviously ready for a liberal autonomy.” Yet in addition to letting people have a go, we should also take their experiences with diverse aspects of the market process seriously, both in what they praise and what they criticize. This, we believe, is the duty of any liberal and humane economist.

The closing of the epistemological gap thus means liberal engagement. The economist must be at least potentially able to take their model of reality and bring it to down to the street level. The goal of the liberal economist should be not, as Herbert Spencer had it, to force alien concepts on reluctant minds through varied iterations, but rather to seek convergence between their own perspective and the accounts of the men and women in the “life-world”. If these perspectives clash, the scientist must take the layperson’s criticisms as they come. Unless they do so, they might be – as some more radical intellectuals suggest – be guilty of “epistemicide”: a destruction of knowledge that could question the privilege of modern science.

The economist Don Lavoie has suggested that “economics begins, both historically as a systematic discipline and individually in the education of everyone who learns it, with the everyday world of business,” in fact, adds Lavoie, “there is already a discourse taking place in the economy before the economists arrive to invent ‘scientific’ discourses about it.” This is a humbler starting point. The best economists can hope to do is to add understanding, to enrich existing perspectives on the everyday business of life. Economists, according to this view, are not in a position to uncover or unearth what people should really think or do. Rather, economists should strive to become interpreters seeking a translation between the general knowledge commonly found in social science and the knowledge of particular circumstances of time and place that is the day-to-day stuff of everyday economic life.

This is by no means a straightforward task, yet it is a worthy one. The task is not straightforward because modern society is complex and plural, which means that everyday experiences differ even within a country or social class. This heterogeneity is not limited to the social circumstances in which different groups find themselves, but also in the way they understand and make sense of the world around them; in the knowledge they produce and share. It is worthy because it takes what is dear to people – their identity and sense-making activities – seriously, rather than seeking to discredit or overcome them. This does not mean we should take these practices for granted. On the contrary, taking everyday experiences, practices, and understandings seriously implies a willingness to contest them, to check for their accuracy and robustness. This task is all the more worthy because it can contribute to an appreciation of a pluralistic society in which people are willing to engage, rather than insulate themselves from disagreement.

An economic methodology without a hard epistemological break entails two important changes. First the economist should give up privileging one particular type of knowledge — scientific and general — over all other types of economic knowledge of the world. Secondly, the analysis of the reflexive and critical capacities of economic actors provides an untapped resource for the development of economic knowledge and, in particular, for a kind of economics that is continuous (but not identical) with everyday understandings of the economy. An economics without the epistemological break has important contributions to make to public discussions about the economy, economic policy, and economics education.

About the Authors

Pavel Kuchar is a Lecturer at the Department of Political Economy, King’s College London. Prior to joining King’s, Pavel worked at the University of Bristol, the National Autonomous University of Mexico, and the Xi’an Jiaotong-Liverpool University (China). He holds a PhD (2014) in Economics from the University of Turin (Italy) and a Master’s degree in International Relations from the University of Economics in Prague (Czech Republic).

Erwin Dekker is senior fellow with the F. A. Hayek Program for Advanced Study in Philosophy, Politics, and Economics and a senior research fellow at the Mercatus Center at George Mason University. He has recently published Jan Tinbergen (1903-1994) and the Rise of Economic Expertise (2021) and The Viennese Students of Civilization (2016), as well as the edited volume Governing Markets as Knowledge Commons (2021) all with Cambridge University Press. He has published in professional journals regarding history of economics, methodology of economics, cultural economics and economic sociology. He is currently working on a history of the intellectual descendants of the German Historical School as well as a project on markets at the margins of society, so-called grey zones. He has previously worked as assistant professor of cultural economics at the Erasmus University of Rotterdam.

Related Content