A note on the dopey "Hip Heterodoxy"

Allow me to deconstruct part of one paragraph of yet another whiny, dopey critique of mainstream economics, "Hip Heterodoxy", by Christopher Hayes.

The problem, then, that heterodox economists face is that they are economists who don't "think like economists." Many point out that humans aren't rational, or not nearly as rational as the theory would have them be (and, further, that in the aggregate this creates market failures). Others point out that humans are social creatures, not individual agents, and their preferences and behaviors are forged by social structures: institutions, habits, social mores and culture all mediate and drive economic behavior. Others say that price and value aren't interchangeable and that prices don't arise from the simple intersection of supply and demand curves, while some argue that unequal power between different sectors of society affects how markets operate.

1. Humans aren't rational? By "rational" economists mean that people respond to incentives. Nothing more. And if rats, pigeons, and snails are rational--see, for example, "Demand Curves for Animal Consumers" by John H. Kagel, et al., Quarterly Journal of Economics, 96(1), 1981--wouldn't it make a lot of sense to assume that people are also?

2. Preferences can be "forged by social structures: institutions, habits, social mores, and culture"? THis is perfectly compatible with mainstream economics. We economists have relatively little to say about what determines preferences or tastes. We emphasize the other major determinant of choice: the opportunities individuals have.

3. "[P]rice and value aren't interchangeable": no kidding! Look up in any elementary economics text the phrases "consumer surplus" and "producer surplus" and you'll find fuddy-duddy mainstream economics completely agrees.

4. "[U]nequal power between different sectors of society affects how markets operate": I'm sorry, I'm old-fashioned, but this is a bit vague. What do you mean by "power"? What "effects"? But it's at least possible that this "heterodox" assertion is also compatible with mainstream ecomomics. If "power" derives from purchasing power, which in turn derives from income and resources, mainstream economics absolutely agrees that power affects markets.

5. "[P]rices don't arise from the simple intersection of supply and demand curves": O.K., we don't teach this one. But once again, I'm not sure what's being asserted. What does determine prices, then?

If you're scoring at home, that's one, maybe one and a half,  points out of five that are valid.

Also note that the article has a thesis that is contradicted in the article itself: heterodox economists are supposedly shunned and silenced, but "an explosion of new research programs and methods have provided strong evidence that many of the pillars of that consensus rest on a foundation of sand. In fact, just before the reception, AEA president George Akerlof, a Nobel laureate as respected in the profession as they come, gave what was in many senses a radical address, attacking some of the discipline's most basic assumptions about what drives human economic behavior."

Maybe just bad heterodox economics is rejected?