Learning Objectives
By the end of this section, you will be able to:
- Discuss critiques of the orthodox definition of economics.
- Understand the differences between facts and beliefs.
- Describe the differences between needs and wants.
- Understand the interconnection between facts and values.
- Compare the differences between scarcity and surplus.
- Compare the differences between and individual and social approach to economics.
- Identify the relationship between unlimited wants and environmental degradation.
Chapter one presented the orthodox case for utilizing the limited resource, unlimited want definition. For economists outside of the orthodox paradigm, however, the orthodox story contains troubling elements. While potentially insightful in certain instances, the orthodox definition is also potentially misleading in terms of clarifying what it is that is actually happening in the economy. What follows are, from a heterodox (alternative) economic perspective, four critiques of the orthodox definition of economics and its implications.
Are Unlimited Wants (and therefore Scarce Resources) a Fact of Life or a Belief?
A fact is something immutable, it just is, whereas a belief is something that a person or people think, whether there is evidence to support their contention or not. An atheist or a theist cannot prove their beliefs, God may or may not exist, but there is no way to empirically prove either view. Atheism and theism are beliefs, not facts. In terms of belief-based versus fact-based analyses in the realm of economics, noted 20th century political economist Karl Polanyi criticized the orthodox (neoclassical) scarcity story as scarcity assumed within the mind of the orthodox economist. In other words, scarcity is a belief of the orthodox economist, not a fact.
Outside of orthodox economics, such as within heterodox (alternative) economic circles as well as the other social science disciplines, the issue of scarcity as induced by unlimited wants has been extensively evaluated and re-evaluated. For many theorists, the concept of unlimited/endless want of material items is simply not an immutable fact present in all times and places among all human beings. Among anthropologists, for example, there is a rich history of ethnographic studies documenting ways in which small-scale, non-market oriented economies appear to behave differently than orthodox economists predict. One such anthropologist, Marshall Sahlins, explicitly notes that people residing in hunter-gatherer societies, while viewed as deeply impoverished by the standards of people residing in advanced industrial economies, are actually quite affluent because “all the people’s wants are easily satisfied.” For Sahlins and other anthropologists, the hunter-gatherer’s affluence is not one of vast material abundance, but rather a happiness shaped by being contented with having basic needs and wants met. By having little and demanding little, a successful hunt can yield great want sat