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Rodrik may be right on the plurality of models, but what about teaching? The case of international trade
Andrea Salanti

Last modified: 2019-06-14

Abstract


Use of models in economics dates back more than one century. For a long period the most common justification of this state of affairs would have probably been framed in terms of economists’ hunting for expanding the empirical domain of their pivotal models, or for generalizing their favored theoretical principles. Starting from Gibbard and Varian (1978), an increasing bulk of literature has been devoted to investigating different kinds of models and their role in economic explanations. Following them the huge proliferation of models within economics has been regarded as due to a search for “robustness”. From this perspective the abundance of models should be interpreted as the outcome of repetitive attempts to establish the robustness of the conclusions so attained by comparing results obtained by different arrays of particular modeling assumptions. More recently, Rodrik (2015) has offered us a different perspective: “Knowledge accumulates in economics not vertically, with better models replacing worse ones, but horizontally, with newer models explaining aspects of social outcomes that were unaddressed earlier. Fresh models don’t really replace older ones. They bring in a new dimension that may be more relevant in some settings.” (p. 67). It is not at all surprising, therefore, that our textbooks are more and more plenty of what economists see in the world, i.e. their models. But it is equally not an exaggeration to say that it is not always clear, to say the least, why such a variety of models, in their turn based on an astounding array of different assumptions and leading to disparate conclusions, ought to help the student to grasp the fundamental relations at stake and their empirical relevance. According to Rodrik, diversity of models provides economists with a set of models that could be applied to different contexts. Explanation, therefore, requires finding the right model for the particular explanatory task, hence the particular context. Thus, explanation should start from considering a set of diverse models and then progresses to select the ‘right’ model suited to explain the particular situation at stake. In a sense, diversity of models should be appreciated as way to increase economists’ chances of finding the right explanatory model. All this, however, raises the question: which kind of models (methodologically speaking) do we teach to our students? The case of international trade theory will be discussed in this respect.

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