Methodological Overview - Economics and Ecology: United for a Sustainable World - page 3

remember and honor this distinction. In fact, the occasional capriciousness
of human behavior is embraced as a central component of each of these dis-
ciplines. They often delight in explaining how human beings are not ratio-
nal, whereas economists stubbornly cling to the premise of the “Rational
Economic Man,” and they fret that if this overly simplistic, mechanistic
assumption is not granted, the elegant mathematical models will lose their
applicability and predictive powers. Of course, any devotion to methodology
over the substantive topics and issues is a potentially dangerous mistake for
any academic discipline.
Only economics, among the social sciences, is annually awarded a Nobel
Prize. With tongue in cheek, it is noted that in seeking to deserve this
award “for economic science,” traditional economists take the restrictive
assumptions that allow the preferred tools to be used a bit too seriously
and arrogantly.
Economics places almost total emphasis on achieving efficiency. Efficiency,
in the context of economic methodology, is the achievement of a given task
with the least expenditure of resources. As one example, it amounts to a
business creating a certain amount of product by using the fewest resources
possible—and those resources are most likely to be measured as dollar
expenditures, as opposed to physical amounts of materials or energy. This
concept is customarily categorized as efficiency in production .
As a second example, a consumer is said to be operating efficiently if he or
she is able to use a certain amount of goods with the least possible expendi-
ture of income. To be sure, the income, or purchasing power, is representa-
tive of the effort, or the work necessary to secure that income through a job.
Thus, minimum effort to achieve a maximum of use is, in economic theory,
broadly defined as efficiency in consumption .
An additional wrinkle in the approach of economic theory is instructive
at this juncture. In the production sector, the task can either be thought of as
maximizing output subject to a fixed-cost constraint or as minimizing the
cost of producing a fixed output. Similarly, in the household sector, the indi-
vidual or family unit may either maximize use subject to a fixed-income (i.e.,
budget) constraint, or may minimize the necessary expenditure based on a
fixed level of goods and services to be consumed or used. In either sector, these
are inverse processes—one minimization, one maximization—and both are
hailed as offering evidence of the flexibility of economic methodology.
However, neither of these optimization processes—whether referring
to production for businesses or use for households—squares with the real
world. To be sure, we always operate under constraints, but nature is effec-
tive, not efficient. These views of efficiency assume an independent variable
to be maximized or optimized, (i.e., business output or consumer satisfac-
tion) and then perhaps several dependent variables to be manipulated in
achieving the efficiency goal. There neither is, nor can there be, an inde-
pendent variable in any kind of relationship, whether natural or anthro-
pomorphic, an observation that certainly includes economics. Thus, the