Friday, March 22, 2013

The Baton is Passed on from Economists to Architecture

THE INVISIBLE HAND: ARCHITECT THOMAS BEEBY” in Chicago Public Media WTM. A media programme funded by the University of Notre Dame School of Architecture, Chicago.
"Chicago is known for its skyline - illuminated with various architectural styles, each touched by the hands of a architects new and old, classic and modernist"
It is also known as the alma mata of the distinguished Paul Samuelson, who gave new life to a metaphor used only twice by Adam Smith in 1759 and 1776 respectively.  After that the IH metaphor passed almost completely unnoticed by people who read his books until the 1870s and it was hardly noticed afterwards until 1948. (See Samuelson’s basic best selling undergraduate textbook, ‘Economics: an introductory analysis’ p.36, McGraw-Hill, New York).
Moreover, from 1948 thru its 19 editions to 2010, and its c.5 million readers, Samuelson’s textbook, changed the knowledge base of modern economics from its interpretations of the supposed meaning of the IH metaphor. That consequence plagues economics as it is taught and understood among scholars and the wider media that influences the general public and politicians.
From the historical complexities discussed in Adam Smith’s “Wealth Of Nations”, the popular understanding from Chicago's "oral tradition" of how an economy works best, popularized by thousands of it graduates and tens of thousands of those who listened to them or read their supposed ‘positive’ economics, the IH metaphor became the “answer” to everything: 
“Leave the IH to do its magic; no need for government interventions; no need to study how we got into the 'fine mess we’ve gotten into'.  Set aside Smith’s long ‘diversions’ in his book, taking pages that could be summarised in a few lines of pristine algebra; don’t bother with Smith's boring historical methodology ('you're too busy with the reading lists we give you such that you really only have time to read their titles'); study the maths instead (no, they don’t identify the IH but that’s because it’s presence is an unexplainable “miracle”), and, anyway, the IH works in the economy approximately as good old supply and demand curves, prices, markets, and, er, general equilibrium. Look, our equations prove it.”
So it is not surprising that the IH metaphor reappears to describe an excellent architect, one of Chicago’s finest, because the metaphor that blessed the science of economics, is the highest accolade they can give to Chicago's Thomas Beeby.  He stands tall among those Nobel Prize winners also from Chicago (Milton Freidman, Paul Samuelson, etc.,) who gave to the world their new and wholly invented 'miraculous' invisible hand from that well-known, though universally unread, Adam Smith (who died in 1790 and cannot be questioned today, though Professor George Stigler claimed in 1976 that Adam Smith was "alive and well" and was "living in Chicago").  
However, the IH does not exist, though Thomas Beeby's magnificent buildings do.


Blogger airth10 said...

This post made me think of Ayn Rand and her book "Fountainhead", about an architect who would not compromise.

I wonder how much Rand drew on the writings of Adam Smith.

10:15 am  
Blogger Gavin Kennedy said...

Ayn Rand took much of the ideas of economists who subscribed to the 'selfish' thesis of Adam Smith a his alleged IH direct from the likes of Paul Samuelson, plus the 19th-century attribution of 'laissez-faire' to Adam Smith (he never used the words at all). Much of the clamour on behalf of employers was directed at giving them freedom without interference but said nothing bout freedoms for consumers, or labourers, legally constrained as they were by the Combination Acts. The employers through their friendly legislators opposed the efforts to introduce restrictions on the hours of work and the employment of children and women in the pits. They did this in the name of laissez-faire.
Rand's application of her misinterpretations of Smith's ideas helped undermine his proper influence on 20th-century economics with nonsense about the "invisible ahnd'.

5:44 pm  

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