A reasonable question to ask is whether Skidelsky is right. Unlike most critics of economics, Skidelsky has insight from being an emeritus professor of political economy at the University of Warwick. His three-volume biography of John Maynard Keynes (1983–2000) adds authority to his attacks by drawing on that scholar’s work and dissatisfaction with the field. To non-economists, these strengths, coupled with the author’s command of history and his liberal use of choice quotes, seem to justify many of his criticisms. To students of economics, however, the identified failings veer toward caricature and target anachronistic and ideological straw men.

Take, for example, Skidelsky’s charge of amorality. He describes early economists like Adam Smith, John Stuart Mill, and Karl Marx as being concerned with self-interest and justice, albeit in different ways and degrees. For them, there existed the concept of a ‘just’ price that predated competitive markets and represented customary value for the labour used in production, later expanded to include labour embodied in capital. This framework allowed for discussion of fair allocation between production cost and rent. In contrast, modern economics, particularly among its neoclassical adherents in the Chicago School, admit that prices only reflect willingness to pay, with individuals paying more or less depending on their subjective utility preferences. The market price is an equilibrium that is reached when individuals maximise their utilities across different goods subject to their availability.

Robert Skidelsky

Skidelsky argues that this reformulation, supported with technical analysis, replaced the moral sense of value (what is fair) with a numerical one (what is efficient). In the process, modern economics removed the social dimension from economic decision-making and legitimised the evils of labour exploitation, price gouging, inequality, and unemployment at the hands of profit-maximising firms and complicit governments. Humans were little more than selfish calculating machines, each seeking utility maximisation, and were encouraged to act that way for the sake of efficiency regardless of social consequences.

One problem with this description is that few modern economists abdicate their moral responsibility in their research or actually believe humans are wholly self-interested robots behaving in a rational vacuum. Separating equity from efficiency and society from markets may displease humanists, but there is a difference between a reluctance to pick sides and an endorsement of predatory behaviour. Focusing on what can be allocated (i.e. positive economics) instead of why (i.e. normative economics) does not make economists unethical, and it also avoids a culturally specific definition of good or fair.

Even then, many economists, including the Nobel Prize winners George Akerlof, Paul Krugman, and Amartya Sen cited by Skidelsky, use their findings to challenge the discipline’s orthodoxy and to advocate for social change. Using the same tools and framework as neoclassicists, equally influential (but uncited) economists like David Card, Angus Deaton, and Esther Duflo have shown how minimum wages can be non-distortionary, unemployment harmful to health, and open markets beneficial to the poor. While the title of the book clearly shows Skidelsky’s scepticism toward the field, a more nuanced presentation of how economics is generally practised today would mitigate concerns about ideological bias.

Skidelsky makes more solid arguments about the discipline’s methodological rigidity and fixation with mathematical formalisation. Modern economics is distinguished from other social sciences or humanities in having common assumptions and analytical tools used in its research questions. The reliance on logic and quantification may give the discipline an undeserved gloss of rigour while also limiting access for those unfamiliar with its tools or who disagree with its first principles. That said, even with a shared paradigm there exist great diversity and debates among economists that have allowed the discipline to change. Behavioural economics, far from being a marginal subfield preoccupied with quirks deviating from mainstream benchmarks, has reinvigorated the field by adding greater realism. This has led to effective policies that increase personal saving and improve public health. New economic history, instead of being corrupted by ahistorical models and inappropriate tests, has gained tools to revisit conventional wisdom based on anecdote or limited contexts. While cultures and social institutions differ across time and space, they also share commonalities that can be identified with such tools. That fields like literature, linguistics, political science, and sociology have all adopted similar statistical methods indicates their versatility, complementarity, and accessibility.

If economics is to be singled out for its failings, it seems fair to ask whether other fields are subject to the same criteria. Should medicine have as its only defensible purpose the eradication of disease? Should physics be discarded for attempting to find a unified theory or having limitations to testing its predictions? Should philosophers be less smug? If economics is to be judged by its outcomes, should the failures of shock therapy or Washington Consensus reforms outweigh the gains from microlending, cheaper traded goods, and global poverty reduction? It would be useful to understand which achievements made by modern economics are still possible without its allegedly malignant changes over the same period. This Skidelsky does not do.

All the same, Skidelsky has written a provocative and timely book that challenges economics and its practitioners to shift its paradigm and to reclaim a moral foundation before it is too late. Had economics retained its 1970s and 1980s orientation, his censures might have found a more deserving target, but the discipline has since moved on. Economics will continue to evolve, with or without Skidelsky’s admonitions, much like its irrational, all-too-human subjects.