Why Western Economic Models Have Lost Their Explanatory Power

Recently, there has been a growing chorus of skepticism internationally regarding Western economists and their predictive models. European Central Bank President Christine Lagarde criticized some economists for having become “a self-enclosed tribe, lacking openness to other scientific disciplines.” Agence France-Presse commented that economists need to “step out of the comfort zone of spreadsheets and rigid models.” Nobel laureate in economics Esther Duflo wryly noted that economists may have fallen to the “bottom” of the most trusted professions list, even less popular than weather forecasters.

最近，国际上出现了不少对西方经济学家及其预测模型的质疑之声。欧洲央行行长拉加德批评一些经济学家成了“自我封闭的部落，对其他科学学科缺乏开放性”。法新社评论说，经济学家需要“走出电子表格和僵化模型的舒适区”。诺贝尔经济学奖得主埃丝特·迪弗洛自嘲，经济学家在最受信任职业排行榜上可能已跌至“末位”，甚至不如天气预报员受欢迎。

Traditional Western economics takes the abstract, homogeneous “economic man” as its starting point, with behavior oriented toward the pursuit of economic goals such as “income,” “profit,” and “GDP.” On this basis, it constructs a logical framework dominated entirely by deductive reasoning, while simultaneously excluding other factors—such as historical development, humanistic values, and the influence of cultural institutions—as “interference terms.” In distancing itself from the complexity of reality, it has increasingly entered “a formulaic world composed of data models.”

西方传统经济学以抽象同质的“经济人”为原点，以追求“收入”“利润”“GDP”等经济目标为行为取向，构建起完全由演算推理主导的逻辑架构，同时又将历史发展、人文价值、文化制度影响等其他因素作为“干扰项”排除在外，远离现实复杂性的同时日益走入“一个数据模型构成的公式化世界”。

Because of failures in predicting inflation, the Bank of England even hired former Federal Reserve Chairman Ben Bernanke to “take the pulse” of its economic forecasting system, while the Bank of Canada decided to replace its old models with more forward-looking approaches… Peter Vanden Houte, chief eurozone economist at ING Bank, pointed out: “Everyone knows that current economic models cannot produce satisfactory predictions. We need to change our way of thinking, or at least expand the models by integrating other components.”

因为预测通胀失败，英国央行甚至聘请美联储前主席伯南克为其经济预测系统“把脉”，加拿大央行决定用更具前瞻性的方法取代旧模型……荷兰国际集团银行首席欧元区经济学家彼得·范登·豪特指出：每个人都知道，目前的经济模型无法令人满意地做出好的预测，“我们需要换种思维方式，或至少通过整合其他组成部分来扩展模型”。

For some time now, against the backdrop of an overall positive trend in China’s economy, Western media reports have been mixed—some bullish, some bearish, at times predicting “collapse,” at others warning of “threat”—like blind men touching an elephant, unable to reach a consensus. Some of this stems from malicious naysayers clamoring for a Chinese economic collapse, but there is also no shortage of cognitive bias arising from a lack of comprehensive, objective, and dialectical understanding of China’s economy.

一段时间以来，在中国经济总体向好的态势背景下，西方媒体的报道有的看多，有的看空，时而“崩溃”，时而“威胁”，如同盲人摸象莫衷一是。这里面有些是鼓噪中国经济崩溃的恶意唱衰者，也不乏因为缺乏对中国经济全面客观辩证的理解而导致的认知偏差。

Whether forecasting the world economy or analyzing China’s economy, Western economic models face a severe “explanatory deficit.” Over the past few decades, economic globalization and the technological-industrial revolution have brought tremendous changes to the world. Many countries, drawing on their own historical and cultural backgrounds, have explored distinctive development models. The real world that economics confronts has become more complex and pluralistic, exhibiting nonlinear logical relationships. Hilton Root, professor of public policy and political science at George Mason University in the United States, has proposed that the old and new classical economics and neoliberal theories, based on linear thinking and formulaic deduction, cannot explain the reshaping of the world economic system. A completely new theoretical framework should be adopted to elucidate the construction and evolution of political and economic systems.

无论是预测世界经济，还是研判中国经济，西方经济学模型都面临严重的“解释力赤字”。过去几十年，经济全球化和科技产业革命给世界带来巨变，很多国家基于自身历史文化背景探索出独具特色的发展模式，经济学所面对的现实世界更加复杂多元，呈现出非线性的逻辑关联。美国乔治·梅森大学公共政策与政治学教授希尔顿·鲁特就提出，基于线性思维和公式推导的新旧古典经济学和新自由主义理论无法解释世界经济体系的重塑，应采用一种全新理论框架来阐释政治经济体系的建构与演进。

China’s economic development has always been a typical case that Western theoretical models cannot clearly explain or accurately judge. Historically, Western economists have repeatedly predicted that China’s economy would collapse, and China’s economic reforms—deemed incorrect by mainstream Western theory—have nonetheless achieved tremendous success. Some say that whoever can crack the “riddle of China’s economic growth” would win the Nobel Prize in economics. For understanding the limitations of Western economics in explaining China’s economy, Chinese economist Zhu Tian may offer an illuminating perspective. Through extensive global comparative research, he found that, under the premise of implementing market-oriented reforms and opening-up policies, the key differentiating factors behind China’s rapid economic growth in recent decades include not only unique institutions and wise policies but also traditional Confucian culture—especially the culture of valuing savings and education. Yet in the idealized modeling of Western economics, humanistic factors are often “abstracted away” by formulas.

中国经济发展一直是西方理论模型说不清、判不准的典型案例。历史上，西方经济学家曾数次预测中国经济会崩溃，中国经济改革在西方主流理论看来并不正确却取得了巨大成功。有人说，谁能破解“中国经济增长之谜”就能获诺贝尔经济学奖。对于理解西方经济学解释中国经济的局限性，中国经济学家朱天或许能提供启发性视角。他通过大量全球对比研究后发现，在实行市场化改革和开放政策的前提下，导致近几十年中国经济高速增长的主要差异化因素除了独特制度和明智政策外，还有传统的儒家文化尤其是重视储蓄和教育的文化。然而在西方经济的理想建模中，人文因素往往被公式“抽象”掉了。

To understand China’s economy, more humanistic “parameters” need to be introduced. Only by returning the cold, abstract, homogeneous “economic man” to the more concrete, heterogeneous social and cultural person can we better understand the people-centered goal orientation and value commitment of China’s economic policies. Only then can we grasp the internal logic of China’s economic operation and understand why the government can be a “necessary good,” why some high-speed rail lines are built even at a loss, why rural revitalization must be pursued, why the “dual carbon” policy is advanced under enormous pressure, why “lucid waters and lush mountains are invaluable assets,” and why the Belt and Road Initiative is so well received… As Indian-born economist Amartya Sen said: “Economics should be concerned with real people.” Introducing more humanistic thinking into economics would greatly benefit enhancing the explanatory and predictive power of mainstream economics.

读懂中国经济，需引入更多人文“参数”。只有把冷冰冰的抽象同质的“经济人”回归到更加具象异质的社会人、文化人，才能更好地理解中国经济政策以人为本的目标指向和价值依归，才能理解中国经济运行的内在逻辑，弄明白为什么政府可以是“必要之善”，为什么有的高铁亏本也还要建，为什么乡村振兴必须要搞，为什么顶着巨大压力也要推进“双碳”政策，为什么绿水青山就是金山银山，为什么“一带一路”如此受欢迎……正如印裔经济学家阿马蒂亚·森所言：“经济学关注的应该是真实的人”，将更多的人文思考引入经济学，对于增强主流经济学的解释预测能力大有裨益。

Online editor: Zhang Jian

网络编辑：张剑