Sunday, September 4, 2011

Writing Is Not Fungible

Steve Horwitz, over at Coordination Problem, posted a response to Jonathan Chait's argument that labor is fungible. Horwitz also has a follow-up, further driving home the point. The issue is whether or not labor is perfectly interchangeable -- which is the definition of "fungible." The reasonable answer is, "no," but it is clear that Keynesianism runs deep in many economists, who apparently really do take seriously the idea of the homogeneity of capital, including human capital.

Let us apply this to writing and literature, and see where it gets us.

With the fungibility argument, the fact that one is a writer means that one can write anything -- poetry, epics, novels, short stories, essays, articles, popular works, academic and scholarly works, blogs, tweets, plays, teleplays, screen plays, verse, prose, etc. On that logic, the fact that I have a Ph.D. in the humanities and a M.A. in creative writing -- meaning I am highly educated in writing -- means I should not have gotten a job rejection on the basis that I was unqualified for their technical writing position. If writing is writing is writing, shouldn't they want to hire a Ph.D. over a B.A., even if the Ph.D. is in humanities and the B.A. is in technical writing (we will ignore the fact that if I were hired into an English department, there is a good chance, given my background in biology and chemistry and publications in economics, that I would be asked to teach technical writing classes)? People who hire do not think that labor is fungible. If they did, then they wouldn't describe what they are looking for, what makes a candidate qualified. Further, if labor were fungible, then wages would be the same for everyone, since everyone would be perfectly interchangeable.

But even if we argue that labor isn't fungible, but is substitutable, we still have my situation above. Clearly I am a substitute for someone with a B.A. in technical writing -- but the places I have applied to do not think I am a close enough substitute to even call me. And they are likely to hire someone already working as a technical writer over someone who is unemployed.

But let us get away from personal examples. Let us look at where this idea of homogeneity and fungibility gets us. If fungibility were true, a great poet would be able to write a great novel, and vice versa. Of course, as anyone who knows even a little literary history knows, this is far from true. Thomas Hardy, who was a brilliant novelist and a brilliant poet, is a rare example. More typical are the Faulkners and Hemingways of the world -- horrible poets, but brilliant novelists.

Further, one would be very surprised if one were to learn that some great novelist has never read a single novel, but only read verse poetry. In fact, such a person doesn't exist. Great novelists read great novels. Great poets read great poets. One has to have the right literary capital with which to build one's one work. Playwrights read plays, screenplay writers read screenplays. Teleplay writers read teleplays. This doesn't mean that one doesn't get ideas and inspiration from other forms of writing, but the primary literary capital for a given genre will be other work within that genre.

Of course, this isn't news to anyone in literature. I have merely put what is well known and well established into economic terms. But in doing so, I think one is able to highlight why this idea of fungibility of labor and capital is utter nonsense. It helps to see if an idea from one spontaneous order is transferable to another. If it's not, that doesn't mean it's not a good idea for that other spontaneous order, but it should suggest looking at the idea a lot more closely. Spontaneous orders are very similar in structure, after all. I suspect that most ideas about how one spontaneous order works are loosely transferable (but, again, hardly fungible) to understanding how other spontaneous orders work. If an idea not so transferable, it is likely wrong.

Yet another reason why we are not called Keynesian Economics and Literature . Literature is not fungible. Nor is is really substitutable. Each is unique. Literature is heterogeneous.

Along these lines, I have to modify an earlier posting in which I leave out capital theory. Clearly I have come to realize that capital theory is central to an Austrian economics theory of the arts as well.


  1. Keynesianism is impossible to conceive of without heterogeneous capital and labor. I've never been told by any Keynesian economist that labor and capital are homogenous. Never.

    You are completely out of your depths, Troy. Stick to literature. You have vastly overestimated the substitutability of your skills.

  2. Meant to post this discussion of substitutability of labor and capital and Keynesianism:

  3. Did you look at the articles linked in this blog post?

  4. I've been following Steve's discussion and I've read Troy's very poor treatment of Keynesian economics in the his "why we are not called Keynesian economics and literature" post before. I haven't read that last post.

  5. Not sure who Jonathan Chait is, whether he'd call himself a Keynesian, but he makes the point fairly explicitly in support of the stimulus (which Keynesians generally support):

    He doesn't call it completely homogenous, but if it's a question of degrees, he's pretty far on the homogenous side.

  6. If you read my posts on this debate and my comments in the posts I link, you'll see I disagree with Chait's title, although I argue that the post itself doesn't rely on homogeneity at all (only substitutability - which Troy apparently agrees with). Chait is a journalist, though. He's not a Keynesian economist that I'm aware of.

    Keynesianism simply doesn't make sense with homogenous capital, Troy regularlly confuses aggregation with homogeneity, and he regularly makes blatantly false claims about these issues.

    1. You should have stopped with "Keynesianism simply doesn't make sense."

      No, seriously, Daniel (if it's possible to take an kook seriously), if the data being reported-on is accurate, and the stimulus money largely goes to increase the demand for already-employed people, that is a direct indictment of the Keynesian idea that a stimulus can increase employment. It doesn't particularly matter if non-Keynesians defend the stimulus -- the problem is that Keynesians do. Now, the most famous Keynesian still alive (Krugman) says that the stimulus wasn't large enough. Surely that would have made the re-employment problem worse, though, not better.

      Don't bother defending your ideas to me -- I already know you can't.

  7. If you search google scholar for "fungible labor," you will find in a few minutes many people talking about labor as being fungible, that it's required for certain models to work. Which makes the models idiotic.

    If you aggregate things, you treat them as homogeneous, fungible. For example, if you wanted to know about my book collection, are you going to be satisfied with knowing there are over 2000 books? Well, that's the aggregate. And that is sufficient for Keynesian models. It's idiotic to make a judgement of my knowledge based on the aggregate of books I own. What you really need to know is 1) the topic/content of those books, and 2) what I have actually read. Further, 2) itself is complex because we have to ask if that includes books I have read not in my library, if you are interested in what I have learned from what I have read (one also needs to consider articles, the internet, etc.). So an aggregate of my books tells one nothing about what I know. But that's what Keynesian models that use aggregates require. If the models treat things like labor and capital as aggregates, the model treats them as fungible, and the conclusions are thus nonsensical idiocy. And that is true whether the models are Keynesian or neoclassical.

    Keynesianism simply doesn't make sense. It takes a high level of religious faith to believe in it.

    I will note, Daniel, that you make contradictory claims. You say that I'm confused, then you say I make blatantly false claims. Now either I am confused, meaning I don't really understand what I'm talking about, or I am lying, meaning I do know what I'm talking about but I'm misrepresenting the facts. Which is it? You can't have it both ways (I know you try to have it both ways all the time, but I'm not letting you get away with it here). You certainly have the right to believe in the most idiotic ideas to ever cast its shadow across economics since Marx, but you don't get to accuse me of lying. Every place I have seen you post, people prove you are wrong, yet again, about the people you like. I keep hoping you will show some sign of being able to learn, but I really don't have a lot of hope. It's probably best you stick with those with whom you already disagree and learn nothing at all, as that is the only way you're going to get a Ph.D. I will also note that it's a good thing you are getting your degree in a social science, as you would have never made it through an undergrad degree in a hard science. They don't suffer people who believe utter nonsense in the face of a relentless barrage of facts well.

  8. I will let my continuing publications in economics speak for itself.

    1. Seriously?? Daniel is a net.kook, Troy, and everybody who reads his blathering can tell. You don't need to defend yourself against him -- he attacks himself just by posting.

  9. "It's probably best you stick with those with whom you already disagree and learn nothing at all"

    "disagree" should have been "agree"

  10. re: "If you search google scholar for "fungible labor," you will find in a few minutes many people talking about labor as being fungible, that it's required for certain models to work. Which makes the models idiotic."

    Have you looked at any of these, Troy? Most seem to be accusing Marx of thinking this, or not using the term in the sense that Steve was. Try cross-searching "fungible labor" and "Keynesian". You don't come up with much.

    re: "If you aggregate things, you treat them as homogeneous, fungible. For example, if you wanted to know about my book collection, are you going to be satisfied with knowing there are over 2000 books?"

    If I asked you how many paperback books you had and you told me you had 775, would it make sense for me to conclude that all 775 of those books said the exact same things in them? No. One can talk about a set of elements without assuming homogeneity of those elements on all dimensions.

    re: "So an aggregate of my books tells one nothing about what I know. But that's what Keynesian models that use aggregates require."

    I've asked you several times what you mean by this (or statements like this). You have yet to answer me - you just repeat the claim. From what I gather you don't seem to understand the claims you're making.

    re: "I will note, Daniel, that you make contradictory claims. You say that I'm confused, then you say I make blatantly false claims. Now either I am confused, meaning I don't really understand what I'm talking about, or I am lying, meaning I do know what I'm talking about but I'm misrepresenting the facts. Which is it?"

    You can make false claims without lying. You don't come across as a liar. I think you have too high of an opinion of yourself and usually aren't aware of when you make false claims about economics.

    If you don't believe me, write up your next economics piece and submit it to a major economics journal, and see what they think of your view on Keynes.

    re: "I will let my continuing publications in economics speak for itself."

    What peer reviewed publications do you have in economics? I didn't see any on your CV.

  11. I really don't appreciate your arrogance on this either. You've done some college work with genetics, and then you've done a ton of literary work. That's great. I've been studying and working in economics for a decade - I've been doing mostly empirical work - I've succeeded at my job evaluating the facts and making judgements on the basis of the facts. I've spent long nights wading through textbooks and articles fully articulating ideas that you brashly dimiss as "idiotic" without demonstrating any real grasp of yourself. This has been my life for a decade and I still have a lot to learn. I don't know why you have so much trouble accepting criticism of the platitudes you repeatedly drag out. Have you ever even considered actually learning about what you criticize before you raise those crticisms?

    The worst thing is I ask for clarification from you and you never provide it - you just repeat the same claim over and over.

    Do you see me spouting off on literature? No. I may have thoughts on literature now and then but I recognize when I really don't know what I'm talking about. You seem to have no ability to do this.

    1. One would hardly know that you have studied economics for ten years, Daniel. All that time, apparently wasted!

  12. I hate to engage in such things, but here we go.

    I have been studying -- admittedly, on my own -- economics for over 20 years.

    I have received the 1993 Free Market Scholarship from the economics department at Western Kentucky University -- the professor who gives it out said he gave it to me because I understood economics better than his graduate students.

    Today I will be faxing in the paperwork to give permission to publish an article on network theory, organizations, and Hayekian spontaneous orders

    I have another paper, on spatial economics, that will be published soon.

    I have recently peer reviewed a paper on economics.

    I have published on the economics of artistic production.

    I have been invited to a colloquium to help develop the theory of higher education as a spontaneous order.

    I'm not sure what you are asking me to provide. Aggregates are central to Keynesianism. Even you know that.

  13. Of course aggregates are central to Keynesianism.

    Look, I know you write about spontaneous order. That's great - it's an important concept and it deserves more treatment. I also know you work with the economics of the arts.

    What I'm trying to get at is if you really work with or have any concept of mainstream economic theory - I suppose I should have been more specific about that. Your comments suggest you don't, and yet they're extremely caustic towards people that would raise concerns with what you say.

    If you won something called the "Free Market Scholarship" and someone said that to you I'm guessing you can provide libertarian arguments with great fidelity and also with genuine insight. Having gone through graduate education in economics (my master's before the PhD I just started - and grad classes as an undergrad), I'm simply telling you that outside of the community of austrian economics which you have a fair grasp of, you impute things to mainstream economists that I've simply never seen any mainstream economist maintain.

    And based on your resume it seems to me there's no reason to expect you would have ever learned economics as it is largely understood - you mainly have training (and writing experience) in the Austrian tradition.

    All I'm saying is that you should be aware of that particularly when you act so condescending to others.

  14. And look - if you think I'm wrong you think I'm wrong.

    Submit your arguments about heterogeneity and the assumptions of Keynesianisms to a mainstream journal. These aren't particularly complicated criticisms, right? You should be able to put it together. Don't take my word for it - see what they say outside of the echo chamber.

    If you want, submit it to a less cut-throat journal like CJE or JPKE that has a lot of Keynesian reviewers.

  15. Daniel, it's not every day I get to correspond with a proud, accomplished Keynesian steeped in economic empiricism.

    Regarding the stimulus, which touched off this debate: is there a compelling empirical case for taking money away from people and spending it as a means to general prosperity?

    Even though, as you probably know, I consider the theoretical argument to be the important one, I can think of many examples to the contrary.

    Has there ever been an empirical study of the consequences of inflationary monetary policy?

    You talk about the the echo chamber. I think each side considers the other to be its own echo chamber.

  16. Roman-
    First, it's hard to call the mainstream an echo chamber given how massive it is and how much more rigorous it is compared to the Austrian school - half of the strength of which is just internet amateurs.

    But that's another point entirely. My point was that even if you take these two camps it helps to go outside of them. Even if the mainstream is an echo chamber (I don't think it really qualifies), I've published in an Austrian journal, a libertarian journal, and have an article under review at another Austrian journal plus I'm on a book project with Austrians and market socialists (not sure how I got on that one - I don't fit with either). It's not just a matter of who you identify with - if Troy doesn't believe me he ought to submit his critiques to a Keynesian venue. And as I said, it doesn't even have to be a mainstream Keynesian venue - by all means give CJE or JPKE a shot.

    As for your queries on empirical studies - of course there are.

  17. It seems to me that doing so would be like giving a proof of the nonexistence of God to a Catholic journal of theology, but I'll keep those in mind should I ever care to write such a paper.

    Also, let me address what you seem to be suggesting: that my economics is entirely Austrian in nature, and that I come to economics only through that school. I was introduced to the Austrian school through my Game Theory and Humanities class while working on my Ph.D. -- it was Hayek's "Individualism and Economic Order." While working on my dissertation, after I finished my first draft, I decided to read something that had nothing to do with the dissertation -- so I read for the first time Mises' Human Action. Those were in 1992 and 1994, respectively. Both ended up in my dissertation (it turns out Mises did have something to do with my dissertation). Prior to that, I would have considered myself more in the Milton Friedman-Chicago school, with some Walter Williams, some bionomics, and a few others scattered in. I had known about self-organizing processes for over a decade before discovering spontaneous orders, and I had been studying time in a more direct fashion for almost as long before I discovered time's centrality to Austrian economics (vs. the atemporality of neoclassical econ.). Even though I did read that one book by Hayek and Mises' H.A., I did not start studying Austrian economics in a serious way until I attended my first Fund for the Study of Spontaneous Orders conference, where I was told that I should include more Hayek in my paper in which I equated the self-organizing economy with a self-organizing ecosystem (in fact, as I recall, I had not mentioned Hayek even once in the conference draft of the paper). I was invited to a colloquium on Hayek, where I read and discussed Hayek extensively, and then wrote my paper for the next FSSO conference in which Hayek's specific ideas on spontaneous order were brought to bear on artistic and literary production. That is how I came to the Austrian school. I had converted from a crude Keynesian, which is what all people are before they learn economics, to a free market supporter by reading just about everyone but the Austrians. Austrian school economics makes sense to me because it is the only school that matches the world view I had developed independently of learning about the Austrian school. Read my Diaphysics, in which I almost never discuss economics (it was written before I did the FSSO conference), and see if what I say there doesn't match the Austrian understanding of how the economy works.

  18. I confess I'm less interested in Troy's level of expertise with respect to a load of horse hockey like Keynesianism than I am in what I take to be his central issue here: the fungibility of writing.

    I do think that "writing is writing," that all writing is fundamentally the same, that there are general principles that apply to all types of writing. And in my own 40-odd years of writing professionally, I have written a number of different kinds of things - but with widely varying degrees of success. I think any competent writer will probably prove capable of doing almost any type of writing competently, but s/he will probably have to work harder at unfamiliar kinds and will probably have to practice a bit before becoming as polished at a type of writing with which s/he has little experience as s/he is at whatever type(s) s/he most commonly writes. I think if s/he practices enough s/he will do competent work at the new type of writing s/he is undertaking, but the work s/he does may never be as good as the work she originally did in the writing field in which s/he made her original reputation.

  19. There's an argument for the fungibility of artistic talent in Solzhenitsyn's novel "A Day in the Life of Ivan Denisovich." In their concentration camp, accomplished and celebrated painters were tasked with repainting the prisoner numbers of their fellow counter-revolutionaries onto their uniforms when they faded. What more proof could you want?

  20. Jeff,

    In one sense anyone can write "anything," so long as they can write. But is the quality there? No, quality differs, and that's what's important.

    Can a house painter paint a painting? Probably. How good will it be?

    Can a spot welder weld I-beams on skyscraper? Ye, but I wouldn't want to go into the building when it's finished.

    Can a novelist write poetry? There are plenty of novelists who have tried -- and their poetry is typically terrible.

    If writing is indeed fungible, there wouldn't be "widely varying degrees of success." Instead, there would be equal competence across genres. But we don't see that. A beautiful sentence in a newspaper article is different from a beautiful sentence in a verse poem is different from a beautiful sentence in a work of prose fiction. It is not impossible to take someone demonstrating excellence in one genre and training them to write well in another -- but note that it takes training to do so. The need for further training demonstrates the non-fungibility of writing.

  21. People, people!

    I think we all can agree that crappy writing is fungible.