This file is a single-author methodological essay. Shackle asks what it means for an economist to believe a theory, and whether ethical practice requires using only theories accepted without reserve. His answer is that such a demand would destroy economics: any usable theory remains partial, contestable, and interesting because it is not final knowledge. Sincerity therefore means disciplined awareness of theory’s limits, not abstention from theory.
To use only what we perfectly believe is therefore practically and essentially impossible.
The essay proceeds as a sequence of methodological tests. First, Shackle argues that theory begins by excluding reality. Economics has inherited frontiers that separate it from technology, psychology, politics, and ethics, although wealth, choice, motivation, and institutions cross those lines. Its objects are not given by nature but selected by tradition, genius, and accident.
Economics is a field of study enclosed within arbitrary boundaries.
This is not a plea for encyclopedic explanation. Rather, Shackle insists that selection is unavoidable and dangerous: a neglected “powerful factor” may later overturn the conclusions drawn from a tidy model. After choosing materials, economists carve concepts—perfect competition, equilibrium, marginal productivity, liquidity preference, uncertainty—and combine them into models. Since different abstractions capture different likenesses, economics cannot present a single portrait of reality.
I think it can justly be contended that modern economic theory does not show one picture but many highly contrasted ones, maintaining none the less that they are all likenesses of the same reality.
The middle sections classify the hazards. Particular theories illuminate local problems only by building insulating walls around them; those walls fail when feedbacks return, as in the wage-employment example. General theories register interdependence but can paralyze inquiry.
General theories, by contrast, tell us too little about too much.
Static theory receives sharper criticism. Shackle treats equilibrium as a mechanical borrowing whose implied tendency toward rest becomes suspect once time enters. Dynamic theory, with lags and oscillations, shows that small parameter changes can turn stability into cumulative movement.
And this idea is dynamite for the believers in a universal tendency to equilibrium.
His account of econometrics is balanced but severe. He approves the desire to replace vague functions with numerical parameters, because qualitative economics is often insufficient. Yet fitted equations use past data; their future validity cannot be guaranteed when the subject matter learns, imagines, adapts, and invents. The econometric phrase “incomplete information” is for him dangerous because it hints that “complete information” is a meaningful human possibility.
Economics is not physics, it is psychics, the study of men with all their capacity for learning and experimenting and inventing and imagining.
Shackle next turns from theories to institutions. Oral traditions, such as Cambridge and Vienna, can refine doctrines through discussion, but teaching can turn assumptions into self-evident truths and protect doctrine from heresy. He also resists extreme specialization: teachers should encounter research, researchers should teach, and technical experts should explain their methods to others and to themselves. His institutional ideal is open craft rather than guarded mystery.
Economists ought to be a guild of craftsmen, not a priesthood with mysteries.
The closing sections make style part of sincerity. Economics is mathematical in treating logical relations among quantities, but it need not always be written in formal notation. Words, diagrams, and symbols must serve exactness, lucidity, and economy. Form is not decoration added after thought; it is the public existence of thought.
A thought can have no public existence save in virtue of the way it is expressed.
The essay ends by defending practical counsel under uncertainty. Economists should neither claim omniscience nor fall silent because certainty is impossible. They are like swimmers in a tide-race who sometimes get a clear view and may then call directions before being submerged again. The relevance of the essay lies in this ethic of fallible use: economic theory is necessary precisely because action cannot wait for perfect knowledge, but honest use demands candor about selection, abstraction, institutional inertia, numerical overconfidence, and the power of language.
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