SCIOD 1: Pantins' Pantomime

Imagine a world in which there are two kinds of people – employers and workers. Each worker is either employed or unemployed. The workers are identical and there is a fixed number of them. They work only because they enjoy buying things with the money they earn. If they can avoid it, they don't like to put any effort into their work. The employers' goal is to maximize profits. Their strategy is to get as many units of output as they can from each dollar they spend on wages.

I could go on with the features of this so-called "economic model" but I won't bother. As the reader may have gathered from the brief description, it is a very sparse and mechanical kind of world, sort of like the one Philip Mirowski likened to the Neues Zaubertheatre in the Steven Millhauser story, "The New Automaton Theater."

In Millhauser's story, "our city" (which remains unnamed) is renowned for its tradition of the miniature automaton theatre, in which it takes immense civic pride and derives deep spiritual pleasure. From time to time a genius of the art of the miniature automaton emerges who surpasses the accomplishments of previous virtuosi. One such prodigy is Heinrich Graum, who, from his youth, strides from triumph to triumph until one day, at the age of 36, he abruptly closes his workshop and abandons the art. A decade later, as suddenly and unexpectedly as he had left, he returns to launch the Neues Zaubertheatre, whose jarring and controversial performances prove to be unlike any automaton theatre the citizens have ever witnessed:

The new automatons can only be described as clumsy. By this I mean that the smoothness of motion so characteristic of our classic figures has been replaced by the jerky abrupt motions of amateur automatons.... They do not strike us as human. Indeed it must be said that the new automatons strike us first of all as automatons... In the classic automaton theatre we are asked to share the emotions of human beings, whom in reality we know to be miniature automatons. In the new automaton theatre we are asked to share the emotions of the automatons themselves... 

In spite of, or perhaps because of its disturbing novelty, the new theatre slowly supplants the traditional, realistically mimetic art and becomes the universal reference for the art. Mirowski "dragooned" Millhauser's story for his book, Machine Dreams, to serve in place of the standard outline of the book that usually appears in the first chapter of modern academic publications:

…the town is the American profession of academic economics, the classic automaton theatre is neoclassical economic theory, and the Neues Zaubertheatre is the introduction of the cyborg sciences into economics…

Except Mirowski's analogy isn't quite right. The workers in this mathematical model world are not "clumsy, amateurish automatons" with "jerky, abrupt motions." They are not automatons at all! They have no motions of their own. It is the model makers, the robotic academic economists, who perform the clumsy, jerky motions of amateurish automatons as they construct their two-dimensional, lifeless models.

In an earlier Millhauser story, "August Eschenburg," which is also about a virtuoso of the automaton theater, the narrator describes a cruel toy that fascinated Eschenburg as a child:

A hollow paper figure represented a clown, or a fireman, or a bearded professor [or a "Walrasian auctioneer" perhaps?]. When you put a captured bird inside, the poor creature's desperate attempts at escape produced in the paper figure a series of wild comic motions.

To amend Mirowski's analogy, it is hollow paper figures that are the microfounded models that academic economists concoct. The captured bird inside that moves the model is the profession's obstinate and anachronistic faith in supply and demand and the price mechanism as universal elixirs of allocative efficiency.