A link on Twitter sent me to the first chapter of Mary Morgan’s book, [amazon_link id=”0521176190″ target=”_blank” ]The World in the Model: How Economists Work and Think[/amazon_link], titled ‘Modelling as a method of inquiry (pdf).’ In the chapter she sets out a brief history of the use of models in economics and argues that economists use models not to uncover economic truths but as a practical form of reasoning or enquiry.

[amazon_image id=”0521176190″ link=”true” target=”_blank” size=”medium” ]The World in the Model: How Economists Work and Think[/amazon_image]

The early economists used words to write about a few general laws – Malthus being a good example – and only a handful used anything like a model. She cites Quesnay’s Tableau Economique as the main example. By the late 19th and early 20th century the use of models had become more frequent – Edgeworth, Marshall and Fisher are cited. But not until the 1930s did modelling come to be ubiquitously used in economics, according to Morgan.

I think this understates the earlier use of modelling. Cournot and Condorcet came to my mind as I read the chapter. I also happen to be reading Roger Backhouse’s [amazon_link id=”B002RI9A54″ target=”_blank” ]History of Economics[/amazon_link], and his chapters on the 18th and 19th centuries cite quite a lot of relatively formal modelling such as the introduction of demand and supply curves. However, the reason for counting differently may be that Morgan equates modelling with mathematical notation, and I disagree with this narrow definition. Maps are models – think the London Tube map – and a historical account of the causes of the 2nd world war is a model too. Modelling is an effort to encapsulate causal relationships as parsimoniously as possible in the face of the complexity and messiness of the world. Economists like to use maths – more than ever, according to this paper – and probably too much so. But the maths could almost always be written out in words. Either “C=a + bY + ε” or or “consumption is proportionately  related to income, above a necessary minimum and subject to random shocks”.

[amazon_image id=”B00EIJGVGQ” link=”true” target=”_blank” size=”medium” ]The Penguin History of Economics[/amazon_image]

However, I do agree with Morgan when she writes: “Models function both as objects to enquire into and as objects to enquire with.” She describes them as a way of making informal inference – or, when applied econometrically, of formal statistical inference. Again, though, though, this dual function seems to me to characterise many disciplines. Nor do I think economists only use models, which would be madness, although some do over-use them and fail to distinguish between the model and the world. As John Kay put it, citing [amazon_link id=”0982755902″ target=”_blank” ]Alfred Korzybski[/amazon_link], the map is not the territory. Apart from statistical methods, historical reasoning and experiments also have an important place in economics.

The book looks interesting. I have a teetering in-pile at the moment but might put it on the for-later list.