China Social Science Review

No.3, 2024

 

The “Rigor” vs. “Relevance” Controversy in Economics: An Examination of the History of Ideas

(Abstract)

 

Li Lili and Ren Weiwei

 

In the second half of the twentieth century, especially since the global financial crisis of 2008, the typical criticisms against and debates about economics have been based on a“trade-off presupposition”— the excessive pursuit of the logical “rigor” of economics is at the expense of the “relevance” of reality. A correct trade-off should be sought between the two. An examination of the history of economic thought since the formal creation of the discipline of economics at the beginning of the 20th century reveals that the relationship between “rigor” and “relevance” in economics has gone through a process of internal unity—potential differentiation—open antagonism—continuous split. In this process, the understanding of “rigor” has seen a shift from “empirical rigor” to “mathematical rigor,” which has given rise to the popular “trade-off presupposition.” In view of the fact that this shift is not a natural and predestined evolutionary process, economics urgently needs to break away from today’s single narrow standard of “mathematical rigor,” get rid of the traditional trap of “trade-off presupposition,” adhere to the methodology of pluralism, and truly realize the unification of “rigor” and “relevance.”