A Critique of Neoclassical Economics as a Regime of ‘Truth’: Empire and Emperors with No Clothes

Abstract

Offers a critical analysis of the dominant conception of political economy which underpins the unsustainability of modern societies—namely neoclassical economics. This chapter seeks to explore and explain its attraction and dominance by looking at its ‘mythic’ and ideological character. Starting from a Foucauldian and Marxist inspired analysis, it analyses neoclassical economics as a form of power/knowledge which constitutes a dominant ‘regime of truth’. As such it has systematically eroded pluralism within thinking about the economy. The question motivating the analysis here is this: if no one seriously accepts that there is ‘one truth’ in relation to how the polity should be organized, why then do we witness the imposition of ‘one truth’ in how the economy should be organized? The reason for this extended critique of the economic orthodoxy is explained in terms of the ‘real-world’ impact of neoclassical economics as constituting not simply the dominant language of public policy (given the privileged position economics has in public policymaking within liberal democracies), but constituting an even more powerful general grammar of public policy.