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Two Giants

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5/2/1968 Kenneth J. Arrow, professor of economics, in his office. Credit: Chuck Painter / Stanford News Service
5/2/1968
Kenneth J. Arrow, professor of economics, in his office.
Credit: Chuck Painter / Stanford News Service

Two of the most important social scientists of the 20th century, whose work remains highly illuminating in the 21st, died this week. First, the Nobel-prize winning economist Ken Arrow, who was enormously and justly influential. Most relevant to contemporary American politics is his still-definitive explanation for why markets in health care don’t work.

Also dying this week was Ted Lowi, one of the true greats of political science. R.I.P.

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  • I honestly had no idea Arrow had even still been alive. A giant in the field for sure.

    R.I.P. to both of them.

  • Gregor Sansa

    Arrow’s impossibility theorem is the basis of the field of voting theory. It’s used today by people who misunderstand it, to push the field in the direction of brittle axiomatic voting criteria rather than fuzzier statistical thinking, and to deny the importance of rated as opposed to ranked systems… but that was never from Arrow himself. He was a gracious man. He lived within 2 miles of my parents’ house, but though I’d corresponded with him I’d never met him. A true loss. This man touched my lifre as few have.

  • DAS

    Unfortunately my first introduction to Arrow’s work was from political conservatives whose take home message from the famous impossibility theorem was “no voting system works, so perhaps we shouldn’t bother with democracy”.

    Even at the even the liberal NYT obit, they manage to only tell part of Arrow’s result with health care markets: reading the obit, you’d think Arrow’s work indicates individuals should pay directly for health care costs rather than having insurance that pays — I.e. you’d think that Arrow’s framework would lead to HSAs rather than the ACA.

    Prof. Arrow was one of the greatest liberal theorists of his time. Unfortunately conservatives have been able to cherry-pick his work to argue “even the liberal Kenneth Arrow mathematically showed liberal and democratic ideas don’t work but the free market does”. It’s pretty easy to do: highlight the impossibility theorem, the proof that (ideal) markets work and cherry-pick the work on health care to only “show” money is not wisely spent when someone else pays the bill.

    It’s like how conservatives think “Born in the USA” supports their jingoism. Kenneth Arrow was the Bruce Springstein of economics and poli sci. Can you blame a person when others deliberately misread his work?

    • Gregor Sansa

      no voting system works

      Which is totally not what the theorem says. It doesn’t even apply to rated systems! (Though it forms the basis for the Gibbard-Satterthwaite theorem, which does apply to all systems.)

      • DAS

        The misrepresentations of Arrow’s work I heard in college and grad school (consensus theory was relevant to my research) certainly must have contributed to my general impression that conservatives and “even the” liberals are intellectually dishonest.

        If I were teaching a class on media bias or rhetoric or something like that, I’d have students do a compare and contrast: compare how a the NYT obit presents Arrow’s results on health care with how Krugman presents them …

        I’m almost tempted to at least post these items for the students in my upper division writing course to read as an example of how an expert writes about a subject for a non-expert audience vs. a non-expert writing for the same audience but with a different purpose.

  • joel hanes

    Nut graf from the linked Krugman/NYT, quoting Arrow :

    There are, however, no examples of successful health care based on the principles of the free market

  • patrick II

    No one is going to go out and try to catch cancer so they can get a free million dollar chemotherapy treatment. Health is a condition, not a commodity. Republicans try and hit every object, nail or not, with their free market hammer.

    • Ahuitzotl

      preferably without ever having a free market, though – their idea of a free market is one where they control how it’s rigged

  • Late in life, Kenneth Arrow was invited to China with Joseph Stiglitz to talk to Chinese officials on market reforms. I don’t think the Chicago boys were asked. Excellent judgement by the Chinese.

    • This makes me feel somewhat less bothered about the fact that this will probably end up being the Chinese century. Still not feeling that great about it overall, mind you, but it does show that they’re thinking clearly on this particular issue.

  • Peterr

    One of the most interesting econ courses I took in college was in the economics of health care, at a time when HMOs and other structures were being trumpeted as The Solution to the problems of the health care industry. (MOAR Markets!) As I recall, the professor started with Arrow and “Uncertainty and the Welfare Economics of Health Care” on day one and then said something like “the rest of this course will be an attempt to prove him wrong.”

    By that metric, the rest of the course was unsuccessful. When measured by what the students learned, it was a raging success.

    Which was exactly the professor’s point.

    RIP, Ken.

  • sleepyirv

    With John Nash and Thomas Schelling’s recent passing, it seems like all the persons covered in my undergrad game theory class are now deceased. A great shame, we could all wish to accomplish something as important as Arrow’s work in health care, much less his other contributions to economics.

  • No Longer Middle Aged Man

    I cited Lowi various times in my dissertation. His 1964 review of Bauer, Pool & Dexter’s “American Business and Public Policy” demonstrated to me as a doctoral student how a terrific book review can be important on its own and make an excellent book even better.

  • dcoffin

    For a very good overview of Arrow’s contributions to economics, this series of four blog posts s a good starting point:
    https://afinetheorem.wordpress.com/2017/02/22/the-greatest-living-economist-has-passed-away-notes-on-kenneth-arrow-part-i/

  • vic rattlehead

    RIP.

    I had the privilege of taking a course taught by Lowi in college. Incredible lecturer. I was too much of a dilettante (and honestly, slacker) to pursue graduate work in political science, but for a brief spell he got me fired up.

    A friend recommended I take the course with Lowi my…sophomore? year. That man was the reason I became interested in political science in the first place. (I came into college wanting to be a Chemistry or econ major). I didn’t have a relationship with him, but I knew I wanted to be a Government major by the end of the semester.

    Ended up going to law school, but that class really got the ball rolling for me.

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