Freedom in markets and freedom in the academia

June 2, 2012 at 4:37 pm (Information, Oh the humanities!, Price theory)

Here’s one curious phenomenon: The vast majority of those academics who spend careers studying market failures and how government intervention can correct them (by this I don’t mean only economists speaking in the language of economics, but any social scientist implicitly arguing for a role in public planning and regulation in controlling markets) are also vehemently against public control of a market that is probably the most prone to the pursuits of self-interest at the expense of others (i.e. failures to internalize costs) – the academic market.

I don’t mean the generation of ideas in the broad sense. I mean the system with which we generate, debate and publicize those ideas in most developed countries, through the research university system and in the form of publications, lectures and conferences. If we were to analyze it as a market – with society (including other academics) purchasing knowledge from academics in return for salary, social status, and reputation – it is a very peculiar market indeed. There are several characteristics that seem to define the academic market:

1. Extreme difficulty in measuring output and productivity, especially in the short-run and outside of the sciences.

2. An almost complete inability to internalize costs. Having bad ideas doesn’t hurt you – look how well our sociologists and anthropologists are doing.

3. Conflation with several other markets – in the sense that society does not only demand knowledge (in the narrow sense of useful, relevant information about society or the physical world) but also entertainment, grading, political ammunition and other goods from academics.

It suffices to say that there is great potential for market failures among academics, the most pertinent of which is probably the incentive for academics to peddle nonsense in place of actual knowledge. Any honest scholar who has bothered to examine the last 30 years of postmodernist research in the humanities surely will not disagree that such market failures exist.

In a sense, “intellectual freedom” is a specific case of “free markets”; if we are so eager to impose our restrictions on badly functioning markets, then why is it considered taboo to even speak of limiting intellectual freedom? Perhaps when one thinks of intellectual freedom, one thinks of a young genius challenging an out-dated orthodoxy with daring conjectures; when one thinks of limits of intellectual freedom, one thinks of Giordano Bruno burning at the stake for questioning religious dogma.

It helps to think in terms of another perspective. Think of intellectual freedom as the struggling sociologist whose discipline is eroding in significance as it is gradually replaced by quantitative methods, and who has never had a knack for mathematics; he has no choice but to join the dying chorus of fellow sociologists decrying the “unrealistic” and “inhumanistic” nature of mathematical modelling, whatever merit these criticisms may have. And think of limits of intellectual freedom as a political adviser in the Medieval times, who is forced to provide useful and accurate analyses of each situation simply because his head will be cut off (by the enemies or by his own liege) if his advice turned out to be wrong.

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