Language and Interest in the Economy: A White Paper on 'Humanomics'

6 Pages Posted: 12 Aug 2011  

Deirdre Nansen McCloskey

University of Illinois at Chicago - Department of Economics

Date Written: 2010

Abstract

Economics ignores persuasion in the economy. The economics of asymmetric “information” or common “knowledge” over the past 40 years reduces to costs and benefits but bypasses persuasion, “sweet talk.” Sweet talk accounts for a quarter of national income, and so is not mere “cheap talk.” The research would direct economics and the numerous other social sciences influenced by economics back towards human meaning in speech - meaning which has even in the most rigorously behaviorist experiments been shown to matter greatly to the outcome. Sweet talk is deeply unpredictable, which connects it to the troubled economics of entrepreneurship, discovery, and innovation. The massive innovation leading to the Great Fact of modern economic growth since 1800 is an important case in point. Some economic historians are beginning to find that material causes of the Great Fact do not work, and that changes in rhetoric such as the Enlightenment or the Bourgeois Revaluation do. A new economic history emerges, using all the evidence for the scientific task: books as much as bonds, entrepreneurial courage and hope as much as managerial prudence and temperance.

Suggested Citation

McCloskey, Deirdre N., Language and Interest in the Economy: A White Paper on 'Humanomics' (2010). American Economic Association, Ten Years and Beyond: Economists Answer NSF's Call for Long-Term Research Agendas. Available at SSRN: https://ssrn.com/abstract=1889320 or http://dx.doi.org/10.2139/ssrn.1889320

Deirdre N. McCloskey (Contact Author)

University of Illinois at Chicago - Department of Economics ( email )

725 University Hall (UH)
Chicago, IL 60607-7121
United States

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