Friday, October 30, 2015

I Grieve For My Discipline: Naïve Empiricism in the Extreme

Don Boudreaux writes an econ student:

Mr. Yong Park

Dear Mr. Park:

Thanks for your e-mail.

Objecting to my prediction that a 107-percent increase in the minimum wage (to $15 per hour) will destroy many jobs for low-skilled workers, you accuse me of “raising theorizing over necessity of data,” and of making a prediction that “is not scientifically supported yet.”  You believe that because we have no empirical data on such a steep hike in the minimum wage at the national level in the U.S, we can say nothing about its likely consequences.

I’m sorry, sir, but your empiricism is naïve in the extreme.  As my friend Lyle Albaugh points out, the absence of empirical observations of the consequences of an atomic bomb being dropped on New York City does not prevent us from justifiably predicting massive death and destruction in Gotham should such a bomb be dropped.

A great deal of evidence of the consequences of other minimum-wage hikes – in combination with enormous amounts of evidence, experience, and theory showing that individuals’ likelihood of doing X falls as their cost of doing X rises – supply sufficiently powerful scientific justification for predicting that a more-than-doubling of the real minimum wage will destroy jobs for many low-skilled workers.  To counsel “silence” on this question unless and until we have “enough empirical data” is not, contrary to your claim, “to insist on economists being scientifically modest.”  Instead, such counsel is to insist on economists being unscientifically moronic.  It is to insist that we abandon reason.

Donald J. Boudreaux
Professor of Economics
Martha and Nelson Getchell Chair for the Study of Free Market Capitalism at the Mercatus Center
George Mason University

The above originally appeared at Cafe Hayek.


  1. Of course Mises or Hazlitt would say we should use deductive reasoning to determine the consequences. There are no experiments in a living, changing economy.