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Cents and Sensibility: What Economics Can Learn from the Humanities
Economists often act as if their methods explain all human behavior. But in Cents and Sensibility, an eminent literary critic and a leading economist make the case that the humanities, especially the study of literature, offer economists ways to make their models more realistic, their predictions more accurate, and their policies more effective and just.
Gary Saul Morson and Morton Schapiro trace the connection between Adam Smith's great classic, The Wealth of Nations, and his less celebrated book on The Theory of Moral Sentiments, and contend that a few decades later Jane Austen invented her groundbreaking method of novelistic narration in order to give life to the empathy that Smith believed essential to humanity.
Morson and Schapiro argue that Smith's heirs include Austen, Anton Chekhov, and Leo Tolstoy as well as John Maynard Keynes and Milton Friedman. Economists need a richer appreciation of behavior, ethics, culture, and narrative--all of which the great writers teach better than anyone.
Cents and Sensibility demonstrates the benefits of a freewheeling dialogue between economics and the humanities by addressing a wide range of problems drawn from the economics of higher education, the economics of the family, and the development of poor nations. It offers new insights about everything from the manipulation of college rankings to why some countries grow faster than others. At the same time, the book shows how looking at real-world problems can revitalize the study of literature itself.
Original, provocative, and inspiring, Cents and Sensibility brings economics back to its place in the human conversation.
Gary Saul Morson and Morton Schapiro trace the connection between Adam Smith's great classic, The Wealth of Nations, and his less celebrated book on The Theory of Moral Sentiments, and contend that a few decades later Jane Austen invented her groundbreaking method of novelistic narration in order to give life to the empathy that Smith believed essential to humanity.
Morson and Schapiro argue that Smith's heirs include Austen, Anton Chekhov, and Leo Tolstoy as well as John Maynard Keynes and Milton Friedman. Economists need a richer appreciation of behavior, ethics, culture, and narrative--all of which the great writers teach better than anyone.
Cents and Sensibility demonstrates the benefits of a freewheeling dialogue between economics and the humanities by addressing a wide range of problems drawn from the economics of higher education, the economics of the family, and the development of poor nations. It offers new insights about everything from the manipulation of college rankings to why some countries grow faster than others. At the same time, the book shows how looking at real-world problems can revitalize the study of literature itself.
Original, provocative, and inspiring, Cents and Sensibility brings economics back to its place in the human conversation.
320 pages, Hardcover
Published May 30, 2017
40 people are currently reading
644 people want to read
About the author
Gary Saul Morson
42 books35 followersGary Saul Morson is an American literary critic and Slavist. He is particularly known for his scholarly work on the great Russian novelists Leo Tolstoy and Fyodor Dostoevsky, and the literary theorist Mikhail Bakhtin. He is Lawrence B. Dumas Professor of the Arts and Humanities at Northwestern University.
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Displaying 1 - 19 of 19 reviews
June 30, 2017
It's nice to know that my liberal arts degree and my time spent studying literature is not all for naught.
Cents & Sensibility talks about how culture informs the performance and actions of society which eventually dictate the market. Also, the book mentions the need for abstract thinking to come up with the questions that have to be answered in tech, economics, science.
Seriously recommend this read.
Cents & Sensibility talks about how culture informs the performance and actions of society which eventually dictate the market. Also, the book mentions the need for abstract thinking to come up with the questions that have to be answered in tech, economics, science.
Seriously recommend this read.
August 6, 2017
Ironically, this would have benefited greatly from a more serious engagement with the philosophical and sociological literature on some of these topics.
February 13, 2021
This is yet another attack on Economics which repeats the typical mistakes in this sub-literature:
1) To depict Economics as essentially mathematical, despite less than 30% of research articles these days use mathematical models
2) To treat Economics as a predictive science whilst forecasting is a small and not particularly highly regarded branch of Economics.
There is also one very lengthy chapter about universities admissions which is meant to be a damming critique of economics when in fact has absolutely nothing to do with the discipline.
That said, the book has some interesting ideas on how literature (but, mind you, a very particular type of literature: the realist psychological novels of XIX century authors) can enrich economics. This is the most convincing and compelling argument of the book. But hardly one that justifies 320 pages! Privileges from one of the authors being President of Northewestern University, I guess.
1) To depict Economics as essentially mathematical, despite less than 30% of research articles these days use mathematical models
2) To treat Economics as a predictive science whilst forecasting is a small and not particularly highly regarded branch of Economics.
There is also one very lengthy chapter about universities admissions which is meant to be a damming critique of economics when in fact has absolutely nothing to do with the discipline.
That said, the book has some interesting ideas on how literature (but, mind you, a very particular type of literature: the realist psychological novels of XIX century authors) can enrich economics. This is the most convincing and compelling argument of the book. But hardly one that justifies 320 pages! Privileges from one of the authors being President of Northewestern University, I guess.
February 20, 2023
An interesting read for sure. I’m always up for any argument that calls for a balanced, non-dogmatic approaches. Whether development economics or domestic policy, I think it critical those in power be able to call on a holistic—that’s to say multifaceted—understanding of any given issue, and that we hold leaders to this higher standard. An example the authors use early in the book articulates the point perfectly: When assessing the success of development/aid programs, a purely economical approach would determine a return on investment based on some formulation of lives saved and how much in today’s dollars those lives will earn. Given that metric of success, programs that help the poorest places, arguably where they’re needed the most, wouldn’t appear to generate as much return as a less-expensive program in a relatively better off place. On that inherently awful scale, someone thinking purely economically has implicitly made a decision that the poor are valued less. The same choice is made in security decisions: Is it worth saving a poor life from genocide, climate crisis refugees, etc.?
I’m not claiming the decisions are easy, but I want more people at all levels thinking about what it would mean to have the greed and hubris of our society tempered by an understanding of culture, of psychological impact, of duty to society, all of which are lessons and ideals that are thoroughly discussed, debated, highlighted, and refined by the very best works in the humanities.
I’m not claiming the decisions are easy, but I want more people at all levels thinking about what it would mean to have the greed and hubris of our society tempered by an understanding of culture, of psychological impact, of duty to society, all of which are lessons and ideals that are thoroughly discussed, debated, highlighted, and refined by the very best works in the humanities.
September 29, 2019
What’s the difference between the humanities and economics? Stories. When economists pretends to solve problems in ethics, culture, and social values in purely economic terms, they are “spoofing” other disciplines—that is, impersonating someone else’s email name and address to deceive the recipient. Gary Becker and Freakonomics are good examples of this “imperialism.” But economists shouldn’t spoof anyone, instead they need a “humanomics” which allows the discipline to keep its own qualities. There’s no way to grasp most of what people do by deductive logic—we need stories. Novels are a distinct way of knowing. Ethics requires good judgment and cannot be reduced to theories, models, or sets of rules alone. Economics can’t deal with culture since culture can’t be mathematized. Wisdom also cannot be quantified, nor culture. Economic rationality and efficiency is certainly part of human nature, but by no means all of it. For the rest, we need the humanities. The authors use literature to point out that no one in their right mind ever thought people are rational to begin with. Behavioral economics suffers from the same defect, since you don’t need stories to understand their models. There’s no place for surprise in rational choice economics, nor behavioral economics. And humans constantly surprise—we are the ultimate scamps. Behavioral economics takes no more account of culture than rationalists, and it leaps directly to evolutionary psychology or neurobiology. So many insights from these fields leads a humanist to say, “You mean, you had to prove that?” This is how I feel with Dan Ariely’s study of honesty and religion. Or this: A man sees a cashmere sweater he’d like but thinks too expensive. His wife buys it for him for Xmas, and he’s delighted by the gift, even though the couple pool all of their financial assets. Is this irrational? Richard Thaler says yes, a humanist understands the difference a gift makes (it’s why economists think so many gifts cause a “deadweight loss.” It’s funny, possibly true, but why then do we continue to give gifts?
Behavioral economists should subscribe to the [Milton] Friedman rule: do not claim to be describing real people, but rather your models should be judged on the quality of their predictions. But they claim to understand the psychology of humans and hence have gone further from, not closer to, a humanist perspective.
Dostoevsky wrote: [If someone would] “some day…truly discover a formula for all our desires and caprices,” there would be no caprices at all. “There will be no more incidents and adventures in the world.”
Deidre McCloskey’s work is praised, along with the great novelists, who the authors write “understand people better than any social scientist who has ever lived.” Rather than fuse the humanities and economics, we need a dialogue between them. To understand human society and behavior, we need more than biology, and saying that does not diminish biology. Same with economics. Brain scans sound more scientific without adding any real information. Is there a “science of child rearing”?
I particularly enjoyed the metaphor from Isaiah Berlin’s The Hedgehog and the Fox: An Essay on Tolstoy’s View of History. “The fox knows many things, but the hedgehog knows one big thing.” Which are you? Plato and Gary Becker were hedgehogs, Aristotle and Tolstoy foxes, when it comes to understanding human nature. Hegel, Marx, Lenin, Freud, Jeremy Bentham, Einstein, Jared Diamond (geography is mostly responsible for differences in economic development), Paul Ehrlich—all hedgehogs. Montaigne, Shakespeare, David Hume, Adam Smith, Darwin—all foxes. Hedgehogs are subject to hubris, while foxes can sometimes be too tentative. Hedgehogs provide answers, foxes ask deeper questions. Literature by its very nature is foxy. But hedgehogs breed disciples and movements. The authors: “By their very nature, hedgehogs lack the humility necessary to prevent mistakes from becoming catastrophes.”
Great old adage: “Research is to teaching as sin is to confession. If you aren’t actively engaged in the former, you eventually run out of things to say in the latter.”
“Beware the man of only one book.” Latin proverb
There’s a good discussion on the market for organs (and cloning), and economists do need to consider why so many other smart people feel so strongly to the contrary. I don’t have the answer to this—I tend to support a market for organs—but I understand the arguments on both sides. It’s very similar to the abortion debate, and I know there’s no solution, only tradeoffs. Whatever the answer, it takes more than economics to arrive at it, the authors conclude. Agree.
The realist novelists understood ethics as well, deploying “casuistry,” reasoning by specific cases. The word is now a pejorative, but instead of reasoning down from theories, casuistry reasons up from particulars, and novels are an effective way to do this, with a specific character. If ethics was mere deductive reasoning we could program robots with the principles and rules. But an ethical decision left to a machine is not an ethical decision at all—humans must take responsibility for their decisions—we must “sign it.”
It’s also easier to empathize reading novels, since you can put yourself into the characters, identify with them, their inner thoughts, actions, etc. We don’t just see their external selves, but their inner selves, we are on intimate terms with them. Empathy can be abused as well, it’s why con men are effective. The humanities teach us there’s more to the world than ourselves. Literature liberates us from the prison of self, of our culture, and of our historical period—teaches us to be humble about our own knowledge.
At the end of the day, as Aristotle believed, we need judgment, wisdom, and experience to understand our fellow humans. The humanities are about humans, and that’s why there’s so much to learn from them. If you want knowledge, read nonfiction. If you want wisdom, read great literature.
This is a wonderful book, and you will think your way all the way through it, and possibly even alter some of your views on just how complex—and delightful—humans truly are, beyond the understanding of economic models.
Behavioral economists should subscribe to the [Milton] Friedman rule: do not claim to be describing real people, but rather your models should be judged on the quality of their predictions. But they claim to understand the psychology of humans and hence have gone further from, not closer to, a humanist perspective.
Dostoevsky wrote: [If someone would] “some day…truly discover a formula for all our desires and caprices,” there would be no caprices at all. “There will be no more incidents and adventures in the world.”
Deidre McCloskey’s work is praised, along with the great novelists, who the authors write “understand people better than any social scientist who has ever lived.” Rather than fuse the humanities and economics, we need a dialogue between them. To understand human society and behavior, we need more than biology, and saying that does not diminish biology. Same with economics. Brain scans sound more scientific without adding any real information. Is there a “science of child rearing”?
I particularly enjoyed the metaphor from Isaiah Berlin’s The Hedgehog and the Fox: An Essay on Tolstoy’s View of History. “The fox knows many things, but the hedgehog knows one big thing.” Which are you? Plato and Gary Becker were hedgehogs, Aristotle and Tolstoy foxes, when it comes to understanding human nature. Hegel, Marx, Lenin, Freud, Jeremy Bentham, Einstein, Jared Diamond (geography is mostly responsible for differences in economic development), Paul Ehrlich—all hedgehogs. Montaigne, Shakespeare, David Hume, Adam Smith, Darwin—all foxes. Hedgehogs are subject to hubris, while foxes can sometimes be too tentative. Hedgehogs provide answers, foxes ask deeper questions. Literature by its very nature is foxy. But hedgehogs breed disciples and movements. The authors: “By their very nature, hedgehogs lack the humility necessary to prevent mistakes from becoming catastrophes.”
Great old adage: “Research is to teaching as sin is to confession. If you aren’t actively engaged in the former, you eventually run out of things to say in the latter.”
“Beware the man of only one book.” Latin proverb
There’s a good discussion on the market for organs (and cloning), and economists do need to consider why so many other smart people feel so strongly to the contrary. I don’t have the answer to this—I tend to support a market for organs—but I understand the arguments on both sides. It’s very similar to the abortion debate, and I know there’s no solution, only tradeoffs. Whatever the answer, it takes more than economics to arrive at it, the authors conclude. Agree.
The realist novelists understood ethics as well, deploying “casuistry,” reasoning by specific cases. The word is now a pejorative, but instead of reasoning down from theories, casuistry reasons up from particulars, and novels are an effective way to do this, with a specific character. If ethics was mere deductive reasoning we could program robots with the principles and rules. But an ethical decision left to a machine is not an ethical decision at all—humans must take responsibility for their decisions—we must “sign it.”
It’s also easier to empathize reading novels, since you can put yourself into the characters, identify with them, their inner thoughts, actions, etc. We don’t just see their external selves, but their inner selves, we are on intimate terms with them. Empathy can be abused as well, it’s why con men are effective. The humanities teach us there’s more to the world than ourselves. Literature liberates us from the prison of self, of our culture, and of our historical period—teaches us to be humble about our own knowledge.
At the end of the day, as Aristotle believed, we need judgment, wisdom, and experience to understand our fellow humans. The humanities are about humans, and that’s why there’s so much to learn from them. If you want knowledge, read nonfiction. If you want wisdom, read great literature.
This is a wonderful book, and you will think your way all the way through it, and possibly even alter some of your views on just how complex—and delightful—humans truly are, beyond the understanding of economic models.
August 29, 2017
Some of my favorite quotes:
p293 "Two cultures; a common aim. To build a world in which we not only draw upon economics, medicine, engineering, and science in order to lead longer, healthier, and more prosperous lives, but also never forget that it is the humanities and the arts that make those lives worth living. Let's supplement the quantitative rigor, the focus on policy, and the logic of economics with the empathy, judgment, and wisdom that defines humanities at their best."
p292 "There is no place where the complexity of ethical questions is appreciated more than the great novels.."
p292 "To be sure, humanists have a lot to learn from economists as well. When resources are limited, the efficient use of them is itself a moral as well as an economic issue. We need to recognize that choices entail costs as well as benefits. We need to be more wary than humanists often are of counterexamples and confirmation bias."
p291 "So let us summarize a few ways economists can learn from the study of literature. A serious engagement with great writers includes living into their perspectives and the perspectives of their characters. One comes to sense from within what it is like to feel like someone else and to think like someone else. We overcome our natural tendencies to presume that everyone is like us or that, if they are not they are benighted. In many ways, literature liberates us from the prison houses of self, of our culture, and of our historic period. Literature thereby teaches us to be humble about our own knowledge. When it comes to human beings, things are always likely to be much more complex then they seem. In the hard sciences, Galileo was right to imagine that most times real simplicity lies behind apparent complexity, but with human beings, apparent simplicity usually conceals underlying complexity."
p241 "In short, the humanities, if humanists will only believe in them, have a crucial role to play in education. They have access to truths about human beings other disciplines have not attained. And while other disciplines may recommend empathy, the humanities entail actual practice of it. Their cultivation of diverse points of view offers a model for neighboring disciplines, and for liberal arts education generally, to follow...The humanities allow us to escape that island and return to it enriched with the wisdom of elsewhere."
p279 "Some supposed irrationalities, in short, prove quite rational when one considers that attention is itself a resource in short supply...Indeed, it is readily handled by a mainstream economic model that accepts attention, like time, as a limited resource."
p277 "A humanist is also struck by how often she is moved to say in response to some discovery, "you mean, you had to prove that?"
p255 The narrator of Tolstoy's story "Lucerne" observes: 'What an unfortunate, pitiful creature is man, with his desire for positive decisions, thrown into this ever moving, limitless ocean of good and evil, of facts, conceptions, and contradiction!...Men have made subdivisions for themselves in this eternally moving, unending, intermingled chaos of good and evil: they have traced imaginary lines on that ocean, and expect the ocean to divide itself accordingly.'"
p293 "Two cultures; a common aim. To build a world in which we not only draw upon economics, medicine, engineering, and science in order to lead longer, healthier, and more prosperous lives, but also never forget that it is the humanities and the arts that make those lives worth living. Let's supplement the quantitative rigor, the focus on policy, and the logic of economics with the empathy, judgment, and wisdom that defines humanities at their best."
p292 "There is no place where the complexity of ethical questions is appreciated more than the great novels.."
p292 "To be sure, humanists have a lot to learn from economists as well. When resources are limited, the efficient use of them is itself a moral as well as an economic issue. We need to recognize that choices entail costs as well as benefits. We need to be more wary than humanists often are of counterexamples and confirmation bias."
p291 "So let us summarize a few ways economists can learn from the study of literature. A serious engagement with great writers includes living into their perspectives and the perspectives of their characters. One comes to sense from within what it is like to feel like someone else and to think like someone else. We overcome our natural tendencies to presume that everyone is like us or that, if they are not they are benighted. In many ways, literature liberates us from the prison houses of self, of our culture, and of our historic period. Literature thereby teaches us to be humble about our own knowledge. When it comes to human beings, things are always likely to be much more complex then they seem. In the hard sciences, Galileo was right to imagine that most times real simplicity lies behind apparent complexity, but with human beings, apparent simplicity usually conceals underlying complexity."
p241 "In short, the humanities, if humanists will only believe in them, have a crucial role to play in education. They have access to truths about human beings other disciplines have not attained. And while other disciplines may recommend empathy, the humanities entail actual practice of it. Their cultivation of diverse points of view offers a model for neighboring disciplines, and for liberal arts education generally, to follow...The humanities allow us to escape that island and return to it enriched with the wisdom of elsewhere."
p279 "Some supposed irrationalities, in short, prove quite rational when one considers that attention is itself a resource in short supply...Indeed, it is readily handled by a mainstream economic model that accepts attention, like time, as a limited resource."
p277 "A humanist is also struck by how often she is moved to say in response to some discovery, "you mean, you had to prove that?"
p255 The narrator of Tolstoy's story "Lucerne" observes: 'What an unfortunate, pitiful creature is man, with his desire for positive decisions, thrown into this ever moving, limitless ocean of good and evil, of facts, conceptions, and contradiction!...Men have made subdivisions for themselves in this eternally moving, unending, intermingled chaos of good and evil: they have traced imaginary lines on that ocean, and expect the ocean to divide itself accordingly.'"
December 18, 2017
Honestly could have been a bit better, for all the critiques of neo-classical economics, that's just it, it's only a critique of neo-classical economics. Which, while NCE is by far the self imposed and propagating hegemon of the discipline of Economics, the fact that that fact didn't enter into the metric of what economics could learn from the humanities, that is, playing nice with a variety of schools of thought rather than labeling some of them "heterodox" and ignoring them, is a major blow to the book. Taken in conjunction with The Econocracy however, the two together form a sizable and well thought out critique of a field which is given far too much unearned authority.
June 18, 2020
¿Por qué son importantes las humanidades para los economistas? El libro trata de contestarlo. Básicamente porque si queremos entender mejor el comportamiento humano, la literatura nos da muchos ejemplos y además nos permite entender los personajes y las restricciones que enfrentan. Adicionalmente, nos da el contexto o la cultura donde se están tomando esas decisiones. Nos ayuda en nuestra narrativa, todo al final es cómo contar una historia. Nos ayuda también para cuestionarnos la ética de lo que se propone y sus implicaciones. Bastante bueno. Los autores de literatura más citados son Tolstoi, Dostoievsky, y Jane Austen.
September 5, 2025
Academe needs its hedgehogs. Without them, we would miss important principles they have discovered.
We need foxes to come closer to the real truth about contingent beings and cultures. When hedgehogs rule alone, they may mislead; when they inspire foxes, they may shed light.
Literature teaches us to be humble about our own knowledge. When it comes to human beings, things are always likely to be much more complex than they seem.
Given the role that contingency plays in human affairs, narrative explanation is often essential. Mathematicization can provide a good start; after that, we need to recognize narrativeness.
Timely reminder to re-read Bakhtin.
We need foxes to come closer to the real truth about contingent beings and cultures. When hedgehogs rule alone, they may mislead; when they inspire foxes, they may shed light.
Literature teaches us to be humble about our own knowledge. When it comes to human beings, things are always likely to be much more complex than they seem.
Given the role that contingency plays in human affairs, narrative explanation is often essential. Mathematicization can provide a good start; after that, we need to recognize narrativeness.
Timely reminder to re-read Bakhtin.
March 8, 2021
A thought provoking and engaging work that seeks to bridge the divide from the mathematical and logical world of economics and the often irrational and complex world of the humanities. Morson and Schapiro raise a great deal interesting questions and delve into several case studies that address the larger theme of the work. While at times repetitive and not drawing on much of the humanities outside of the realist novel genere, the work still provides a new way of looking at these two disciplines and if taken seriously can lead to a great deal of new learning from them.
July 21, 2017
Delightfully written and did what all good books do - made me want to revisit great classic novels, War and Peace, Crime and Punishment, Pride and Prejudice, Chekhov short stories and more. Confirmed a comment I made in one of my first graduate seminars on use of economic/rational choice theory, a'la Gary Becker, to explain social movement participation: "Everything interesting is in the error term"
June 23, 2021
I loved the incorporation of literature, specifically realist works, and the way it can influence economics. As an economics graduate student, this book has encouraged me to improve my research by including narrative explanations in combination with mathematical models and by consulting literature for guidance when dealing with ethical issues.
September 11, 2017
In an age where universities have been monetized & the marketplace is owned by gatekeepers & their algorithms we have to start creating a world where being human comprises of more than being an economic unit, & this idea is a start.
However, hedgehogs & foxes, as adorable as they are to many, will never be remembered as a metaphor....
However, hedgehogs & foxes, as adorable as they are to many, will never be remembered as a metaphor....
September 19, 2017
Nonfiction
July 31, 2018
Academic onanism.
January 8, 2022
At times inspiring, occasionally thought provoking, but more frequently of specific interest to certain academic and policy-making specialists.
December 30, 2022
I get the point but this was painful to get through
Want to read
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