Joan Robinson, philosopher

There has been a struggle in the history of philosophy to rediscover women philosophers who have been written out of the canon. As Eileen O’Neill argues, this writing out has been a fairly recent phenomenon, and the reasons are interesting and not all malicious (though still not justifiable).

With early analytical philosophy, however, the writing out has been less extensive. No reasonable historian denies the significance of Elizabeth Anscombe, Philippa Foot, Iris Murdoch, Susan Stebbing, Ruth Barcan Marcus, Christine Ladd-Franklin, etc. Even Passmore’s A Hundred Years of Philosophy, with its declaredly limited focus, contains passages on Anscombe, Stebbing, and Barcan Marcus.

There is, however, one woman from this period and tradition whose contribution to philosophy goes largely unrecognised — Joan Robinson (1903–83). This is partly because Robinson was trained as an economist — to the extent that she was trained as anything (her contribution to economics is perhaps also insufficiently recognised; there is a story about her being passed up for a Nobel Prize).

I think some of Robinson’s contributions to economics were contributions to the philosophy of economics. This discipline didn’t officially exist in her day; she was untimely. As far as I know, there is one chapter in an edited collection, by Daniel Hausman, which engages with Robinson as a philosopher of economics, and not much else.

There is also a short review of her book, Economic Philosophy, by George Stigler. This describes Robinson as a ‘superior logician’. It turns out not to be a compliment. Stigler’s complaint about a logician interfering in the affairs of economists is decidedly odd:

A logician is a wondrous creature, but he cannot distinguish between the two simple errors: if A = B and B = C then (1) A = 1.01C, and (2) A = 10⁶⁵C. An economist can (p.193).

Of course a competent logician would recognise that (1) and (2) are near enough to logically equivalent — either is provable from the other by substitution and simple arithmetic. Stigler might have been using a metaphor, but then the mathematical sophistication of the metaphor is a sham — this is precisely the sort of economist’s trick Robinson wanted to expose.

The first significant contribution that Robinson made to the philosophy of economics kicked off the famous ‘Cambridge Capital Controversy’. Robinson noted that economists often build models in which rational decisions are made about how much ‘capital’ to employ. ‘Capital’ is often represented by a single variable, k. Robinson found it conceptually impossible to specify a unit of magnitude here: how many broomsticks, she asked, equals one blast furnace? ‘“Capital”’, she wrote with the standard logician’s nod to Lewis Carroll, ‘is not what capital is called, it is what the name is called’ (83).

This problem didn’t bother mainstream economists. They pointed out that in a Walrasian general equilibrium model there is no variable for ‘capital’ — only agents with certain initial endowments of certain goods, bidding for exchanges at various points in the future. There is no need to aggregate various goods into one magnitude of ‘capital’; if economists do so for ease of presentation in certain cases this is a tolerable fudge and not an uncommon one. As Paul Samuelson wrote in his summary of the Cambridge Capital Controversy:

Since general equilibrium theory viewed all forms of aggregation as suspect, overlooking … concerns about capital aggregation seemed to be one of the ordinary compromises that applied work demands (6281–9).

Robinson never got to criticise the general equilibrium models that were meant to avoid her conceptual puzzles. But the whole of Economic Philosophy is an implicit preemptive critique of the move she knew mainstream economists would make.

A general equilibrium is a set of prices, arrived at by a miraculous mechanism that clears every market. Every buyer and every seller gets what she wants subject to the constraint of what the others want. We have no idea how we could realistically ever get to those prices. We only know that if we somehow reached them — and if all agents are rational with perfect information and futures markets are so complete that I could order a gram of iron ore to be delivered to my home exactly seventy years from now — divergences from the equilibrium prices would be cancelled by the market.

This is not, and cannot be, a causal explanation of anything that actually happens. It looks like an exercise in justification. Economists can model the situation we are in as a general equilibrium. They are then assuming that we are in a condition that approximates as closely as we could realistically hope to everyone getting what she wants. The mathematics proves the internal consistency of the assumption rather than its plausibility. Robinson characterised this move perfectly: ‘It is the business of the economists, not to tell us what to do, but to show why what we are doing anyway is in accord with proper principles’ (Economic Philosophy, 25).

In fact, Robinson preempted the response in her original article on the theory of capital. There she wrote:

The neo-classical economist thinks of a position of equilibrium as a position towards which an economy is tending to move as time goes by. But it is impossible for a system to get into a position of equilibrium, for the very nature of equilibrium is that the system is already in it, and has been in it for a certain length of past time. (“The Production Function and the Theory of Capital, 85)

You might think this is mistaken. Can’t a pendulum, for instance, “get into” equilibrium by gradually coming to rest at its low point? But in the sense that Robinson is using “equilibrium” here, such a pendulum would already be in equilibrium: the forces are in balance, and the future rest state determines the current behaviour of the system. In the case of the economy, the point is that it is not in its intertemporal equilibrium. Nor can it be moving towards it, since the equilibrium defines a state of the system for each point in time, and if the system is in none of these there is no extra time dimension through which it can be moving towards its equilibrium. Something like this must be in Robinson’s mind when she makes her further points about time; what she appears to be criticising is the idea of a system travelling towards its equilibrium:

Time is unlike space in two very striking respects. In space, bodies moving from A to B may pass bodies moving from B to A, but in time the strictest possible rule of one-way traffic is always in force. And in space the distance from A to B is of the same order of magnitude (whatever allowance you like to make for the Trade Winds) as the distance from B to A ; but in time the distance from to-day to to-morrow is twenty-four hours, while the distance from to-day to yesterday is infinite, as the poets have often remarked. Therefore a space metaphor applied to time is a very tricky knife to handle, and the concept of equilibrium often cuts the arm that wields it.

One could reply that Robinson mischaracterises the enterprise. Economists are just describing an ideal case, to which reality might approximate. But if so, they have not shown that the approximation is likely or even possible. She repeatedly insists, in Economic Philosophy and elsewhere, on a standard for scientific claims derived from a sort of fusion of Wittgenstein and Popper. To make a scientific claim is to be ready to explain what it would be like for that claim to be false. What would it be like for the economy not to approximate the condition of intertemporal equilibrium? We can’t answer “prices would fluctuate wildly”, since there are many factors that could stabilise prices besides the miraculous mechanism of general equilibrium.

Stigler complains that Robinson recognises no difference between missing by a hair and missing by a mile. But, as his mathematical example inadvertently shows, in the domain of logic and mathematics the difference between a tiny error and a gigantic one is a mere deduction. If we’re off equilibrium, we’re out of the model. And what happens outside the model, the model can’t tell us. Rebuilding the model over and over again, with various tweaks, is simply expressing an ardent hope that it might apply. We ought to ask why the hope is so ardent.

Pointing this out is a fine piece of applied philosophy. I hope Robinson’s time will come.