ABSTRACT

The use of economic reasoning to analyze health care is a comparatively recent development. However, the seeds for this development were sown long ago. Highly influential neoclassical economists like Paul Samuelson, emulating the success of the natural sciences in employing calculus, derived behavioral rules from mathematically tractable first-order principles. Postwar neoclassicals wanted to reduce the ambiguity of certain economic concepts and remove value ladenness from economics. It was thought that by increasing the hardness of economics, they could do both. Formulating economic theory mathematically undoubtedly increased hardness, which in turn made certain concepts less ambiguous. Theoretical claims that did not lend themselves to mathematical translation were even cast aside by some neoclassicals: ‘[A]ny sector of economic theory which cannot be cast into the mold of such a [mathematical] system [of equations] must be regarded with suspicion as suffering from haziness’ (Samuelson 1947:9). Samuelson admitted that the degree of hardness in economics could only be considered ‘intermediate,’ but that ‘when one descends [in degrees of hardness] lower …say to certain areas of sociology…[they] are almost completely without substantive content’ (1947:ix).