Friday, November 30, 2007

Lament loss of Traditions?

The economist and emotionalist in me sometimes head off against each other. One area where this happens very often is with traditions. This summer as I traveled into some very small villages in Tamil Nadu, I observed several practices that we used to follow, but don't anymore because we have become modern and live in cities. The economic explanation is that the practices that have the most demand will continue while those that have least demand will be shelved. This also comes out of Hayek. However, Hayek also lays heavy emphasis on tacit knowledge. In the Constitution of Liberty and Law Legislation and Liberty, he talks about practices that are based on tacit knowledge, and that even the articulation of some of these rules implies shifting emphasis on other aspects of the tradition. So, following something without knowing the meaning or the reason behind it is not actually wrong or bad.

This is fine as long as we do not talk about what practices live and which ones die out. It makes perfect economic sense that only the ones that are very relevant to the current structure of economic systems will continue and the ones that are not very relevant will fall into disuse. However, emotionally it is not very appealing, since we grow up with certain traditions and would like to hold on to them for ever. I think this is where economists disagree with other social scientists. Where as economists think in terms of relative prices and keep the emotional aspect at bay at least professionally (this is good since its more credible), other social scientists are all about emotions.

So should we lament the loss of traditions? As an economist no!! As an emotionalist sure!! Is that hypocrisy?

1 comment:

Ali Hasanain said...

If that's the characterization we're going to use, I'm glad I'm not an economist.

Why should emotions not be included in determining prices? Because we can't calculate anything then? Sure, but at at least it'll be more analytically satisfying.

Oh, and btw, here's a little economic justification for why traditions relevant to the current structure might not survive: it takes training by one generation to pass on traditions to the next, and we might run into a public good type dilemma there...

P.S. Hope you're well and see you after the exams