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Erik Reinert: we should look to economy as a synergy
Non-Equilibrium Social Science (NESS), an economics-focused network of academics and practitioners, interviewed professor of Technology Governance and Development Strategies Dr. Erik S. Reinert where he talks about some of the real problems in contemporary economics.
Based on his experience having worked in fifty-one countries, professor Reinert claims that economics has “developed into a context free science” and that looking at the world through the equilibrium methaphor should not be the only one used while describing economic models.
Instead, he suggests using “experience based”, “fact based”, or “historical view” based models, so that situations that are out of equilibrium could be explained as well. “If you have a financial crisis you can say, well, what were the other financial crisis, you can make a list of them from 1720 - how did it developed in 1720, that was the first really International financial crisis at the same time in Amsterdam, in London and in Paris, you can compare it and see what’s new here,” professor Reinert explains.
Professor Reinert also emphasizes the need to “to understand that economic society is a synergy” instead of the current approach where focus is “on the individual”. “So the problem is that what used to be assumptions to make the mathematics work, have become “truths”, and these “truths” are not true at all. What used to be assumptions are what in effect are lies,” professor Reinert sums up his criticism on the current misuse of economic models.
The aim of the NESS group, created in 2010, “is to ensure that the social sciences are put on a proper footing for the 21st century“. The majority of its members represent universities located mostly in Europe. The interview was published in the NESS newsletter nr. 3 and was conducted in December 2011.
