Guy Routh’s Formidable Critique of Neoclassical Economics

Citing an Address to the American Economic Association by its then President J.K.Galbraith, Guy Routh emphasised that neoclassical economics is based on foundations which ‘tax capacity for belief’: consumers’ sovereignty , maximisation of profits and subordination of the firm to the market’. Routh goes on to suggest that orthodox economics ignores facts and makes deductions on assumptions ‘plucked from the air. It studies imaginary purely economic phenomena of universal validity without history. Man and society are stripped of their attributes, as if they could exist without psychological, legal, historical or moral dimensions. In effect, orthodox economics – by which term Routh often refers to neoclassical economics -becomes a matter of faith and immune to criticism. (Routh, 1975, page 25,Senker and Brady, 1989 pages 155-158)

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