Philosophy, Society

Marglin’s “The Dismal Science: How Thinking Like an Economist Undermines Community”

I just read Stephen A. Marglin’s The Dismal Science: How Thinking Like an Economist Undermines Community. He questions some fundamental assumptions of mainstream economic theory and makes the case for a more humane understanding of society. I found a great part of the book really interesting but I’m missing a conclusive ending. Anyway, here’s my personal summary in keywords which neither claims to be comprehensive nor one hundred per cent accurate.


– individual vs. community -> tension: good, healthy, creative
– community is important to a good and meaningful life


community (as opposed to ‘just’ association): asks for loyalty, commitment, identity
-> not easy to opt out. leaving the community must come at a cost, otherwise it is vulnerable to centrifugal forces that often are irresistible.
-> diametrically opposed to the idea of market agents with set preferences that are free to choose

– communities of necessity (the poor have to band together) are endangered by prosperity
– communities of affinity (family, religious communities)

examples of community:
– Amish barn raising. insurances undermines mutual dependence of the villagers and thus community
– care for the elderly and sick. now nurses/professional health care

markets undermine community
– markets push for expansion/competition/rivalry -> efficiency is the only measurement
– impersonal market relations replace personal ties, undermine reciprocity, altruism, mutual obligations


– ideology of modernity:

four assumptions in economic theory:
– individuals: have given/fixed/unchanging preferences, are rational, calculating, self-interested
– privileging algorithmic over experimental knowledge
– nation-state: only legitimate social grouping.
– unlimited wants

-> Marglin challenges those ‘myths’: foundational critique


individualism in economics is a very different kind of individualism than in other fields:
– given preferences: individual doesn’t get influenced by its environment. idea is also opposed to self-realization
– universal agency: act without coercion
– radical subjectivism: there is no judge beyond the individual of his preferences
– self-interest: it is a circular argument that everything an individual does is by self-interest, otherwise it wouldn’t do it. so it makes sense to define ‘self-interest’ in narrow terms (non-altruistic etc.)

– holism as a different way to look at the world


what gave rise to modernity?
– loss of community is an unavoidable byproduct of a growing economy/increasing standard of living, or isn’t it?or is it about distribution (landlords pushing enclosure to save their fading power)


– the rise of the idea that if all individuals act in their self-interest, this is best for society as a whole

7. / 8.

– algorithmic knowledge: can be written down, logically calculated
– experimental knowledge: rooted in one’s own experience as well as trust in the accounts of others (parents-child, master-apprentice), therefore rooted in community


(- bosses get their share of the pie only for knowing how to assemble all the parts and keeping this knowledge to themselves)
– economic theory doesn’t take experimental knowledge seriously: cannot model real people
-> economics as a mathematical science (algorithmic knowledge) heaves it above politics and withdraws it from political debate/democracy.


– economists are responsible for growing the pie (whatever the cost), politicians for (re-)distributing it.
– nation-state legitimizes this



  • possibility of abundance as close as never before because of increased efficiency/productivity
  • impossibility of abundance because of unlimited wants
    • relative wants:
      • economic rivalry (having more stuff than the Joneses). wealth is now the dominating factor in defining people
      • believe in infinite growth as a non-zero-sum game (everybody wins as the pie keeps growing) makes it a common goal
    • absolute needs:
      • in an individualistic world-view new goods and stuff substitute for personal relations
      • as long as good health is a commodity, and med-tech keeps improving, it will remain scarce

-> we cannot rethink society when we have reached ‘enough’. rather, we shall have enough when we rethink society.


fair trade as an imagined community between producers and consumers


dominant views:
– culture doesn’t exist, everybody thinks like a homo economics (a ‘modern’ individual)
– western culture is superior, ‘developing countries’ need to catch up and become ‘modern’

– but people can keep (and further develop) their cultures while modern technology is being introduced
– individualism vs. holism: rights of individuals (liberty, autonomous and algorithmic decision-making) vs. rights of communities (experimental knowledge: tradition, spirituality)
– nation vs. other communities