Base your theory on reality - or else stop what you're doing

If it sounds like I'm frustrated, it's because I am.

I just listened to a very smart, very kind, very sweet and very Not In Touch With Reality economist. He was talking about migration - a key subject for anyone concerned with climate change, sustainable development or international development. He was sharing his experience in trying to mesh social theory of why people migrate with economic theory - ie, mathematical models which could predict people's experience of reality. I was intrigued. Afterall, behavioral economics and psychological economics have offered some fascinating insights - though I must say, most of them I could have told them before they did their proofs, but still, it was interesting. I've got tremendous respect for economics, and am grateful I get to work with many economists. So I went to listen. But I wasn't able to stay till the end - it was just too painful.

Economists have an annoying habit of basing their theory on a reality that doesn't exist. Markets are not stable. Human beings are not rational actors. And in the case of this guy, discussing migration without discussing income is not realistic. He sought to hold income stable before and after migrants moved, and to focus instead on relative inequality. While it's true that relative inequality does support at least some migration, much migration happens because of the need to gain greater income. So one can not hold income stable. Yet his theory was based around it. As a result, the mulitple diasporas of the world - of Poles, Jews, Irish, and Eastern Europeans were slammed together with the migrancy of many migrant workers in Africa and south east Asia, despite the difference between them - and the basic facts that drive so much of migration - such as income - was ignored.

But besides one economist whose enthusiasm for his discipline took him away from reality (it is a discipline where one's 'proof' is not in any real 'pudding' but in made-up examples), this raised a much larger challenge for sustainable development. All of us, regardless of our disciplines, are prone to make decisions based on our theory of what should happen, or what we think happens, and not on what actually does happen. And that does not serve anyone.

Photo Credit: Iaau