Causality and Objectivity in Macroeconomics

Tobias Henschen (Universität Konstanz): Causality and Objectivity in Macroeconomics

Macroeconomics is the discipline that uses causal models to analyze the relations of direct type-level causation that are believed to underlie the time series that provide values to variables representing aggregate quantities such as output, unemployment, inflation, interest etc. If these relations are found to satisfy the conditions of invariance and modularity, i.e. to represent stable and autonomous mechanisms, then the causal model is used to explain the respective time series and to derive predictive conditionals and policy counterfactuals.
The causal models that macroeconomists use often imply competing policy counterfactuals: conditionals referring to different policy measures that would have to be implemented to achieve a given policy goal. Since policy measures tend to harm or benefit social groups in different ways, it would be desirable to know which of the policy counterfactuals or causal models implying them is adequate. This cannot be known, however, unless there is at least some standard of scientific objectivity in macroeconomics.

The tradition has conceived of scientific objectivity in roughly two ways. In accordance with these two conceptions, one may say that there is a standard of scientific objectivity in macroeconomics if the causal models that macroeconomists specify and test represent facts about the world, i.e. stable and autonomous mechanisms, or if they accept or reject and gather evidence in support or against the causal hypotheses expressed by these models independently of the non-epistemic values that they happen to endorse.

It’s the aim of the paper to show that objectivity in either of these senses is unattainable for macroeconomists, and that the only sort of objectivity that is attainable for them is a sort of agreement that they achieve with respect to the non-epistemic values (especially conceptions of justice) that underlie causal modeling in macroeconomics.