주류경제학 비판

Critique on Mainstream Economics

1 Ethical Blindness of the Elites

The term elite is often used loosely, but here we adopt a precise and structural definition. Elites are not merely individuals with high income or substantial assets. Rather, they are those who:

Exercise disproportionate influence over the institutional architecture of capital flow and resource allocation;
Actively or passively maintain policies and mechanisms that reproduce this asymmetry across time and context.

In this sense, elites function less as price-takers within a competitive system and more as price-makers—those who shape, define, and often insulate themselves from the very mechanisms that regulate others.

Standard economic models typically begin with the assumption of competitive markets, where no individual agent can significantly influence prices or systemic outcomes. But in practice, elites operate in a structurally non-competitive environment—one governed not by equal access or market-clearing forces, but by institutional design, asymmetrical privileges, and regulatory capture. They shape boundary conditions, institutional norms, informational flows, and legal architectures—determining which forms of capital, whether economic, symbolic, or algorithmic, receive reward or recognition.

What mainstream economics treats as an assumption—perfect competition—is, in practice, a privilege strategically denied to the many and tactically avoided by the few who benefit most from its rhetoric.

This produces a critical asymmetry: competition becomes a binding constraint for the majority, but a flexible and selectively applied instrument for the elite. They do not merely follow the rules—they define them. They do not merely navigate the system—they construct and preserve it in ways that ensure long-term advantage.

Mainstream economics often describes inequality in impersonal terms—as a byproduct of technological progress, market dynamics, or individual preferences. While such forces undoubtedly play a role, this perspective often underplays the degree to which inequality is a designed outcome: structured through policy choices, institutional incentives, and ideologically informed narratives. The locus of responsibility lies not in “the system” as an abstraction, but in those who benefit from and sustain its asymmetries.

This brings us to a deeper concern—not only the existence of exploitation, but the gradual erosion of ethical sensitivity to it. What was once considered morally questionable may, over time, come to be seen as natural, inevitable, or even virtuous. This quiet normalization of exploitative asymmetry echoes the dynamics of moral hazard, though in a structurally expanded and more diffuse form.

If we distinguish between systematic and idiosyncratic risk, the elite can be seen as minimizing their personal exposure—maximizing economic rents—while amplifying systemic risks that are collectively absorbed. Insulation from loss does not eliminate risk; it simply redistributes it—often downward.

In classical models, moral hazard arises when agents take excessive risks because they do not bear the full consequences—typically due to asymmetric information or externalized insurance. The risk in question refers to the downside exposure that would ordinarily discipline a decision-making agent, but is shifted to another party, often through informational opacity or legal insulation.

In elite-driven inequality, the asymmetry lies not only in information, but in systemic unaccountability—a diffuse condition in which responsibility is diluted through complexity, obscured through bureaucracy, or excused through ideology. Elites benefit from structural advantages—preferential access to capital, institutional insulation, and regulatory leniency—while often remaining largely immune to the collective costs those privileges generate.

They bear only the virtual risk of systemic failure, while the real cost is distributed socially.

This dynamic unfolds through at least two distinct mechanisms:

By commission: when elites actively shape systems—through lobbying, legal structuring, or financial engineering—that secure private gains while transferring downside risks to others. This may take the form of offshore tax regimes, deregulated capital markets, or algorithmic decision-making tools that concentrate risk without corresponding accountability.
By omission: when they fail to act upon foreseeable harms embedded in the structures they benefit from. This includes willful neglect of environmental degradation, labor precarity, or declining public infrastructure. In legal terms, this is closer to reckless disregard—a failure to fulfill the duties implicit in one’s structural position.

Both mechanisms are ethically equivalent: they represent a deliberate or negligent transfer of responsibility away from those most capable of managing it, toward those least equipped to bear its consequences.

Take, for instance, the erosion of corporate tax bases in the Global South. Multinational corporations may legally minimize tax burdens via transfer pricing or base erosion schemes. While this behavior is technically compliant with international law, its consequences—underfunded healthcare, stalled education systems, and fragile public institutions—are absorbed by populations with no legal recourse or political leverage. These effects are visible, measurable, and morally weighty—yet routinely dismissed as irrelevant externalities. When structural imbalance generates private gain at the cost of public harm, institutional behavior may internalize moral detachment as a norm rather than an exception.

The deeper problem, then, lies not just in the structure, but in the failure to recognize its moral weight. What begins as technical rationality evolves into ideological complacency. What begins as privilege hardens into entitlement.

What emerges is not merely a policy failure or economic misallocation, but a deeper failure of moral imagination. The classical term for this is hubris: the overconfidence that blinds one to contingency, the refusal to see one’s own position as historically or morally constructed, and the erosion of empathy toward those structurally disadvantaged.

Hubris is not merely arrogance. It is the blindness to one’s contingency—and the unwillingness to bear the moral weight of that contingency.

In Greek tragedy, hubris often leads to nemesis—a reckoning that follows unchecked arrogance. In the context of political economy, the parallel is clear: ignoring the ethical implications of systemic privilege can result in social breakdown, erosion of democratic institutions, or environmental collapse. The way forward, however, does not lie in blame or punishment, but in restoring a sense of moral awareness—the ability to recognize how systems of power, advantage, and responsibility are connected and carry ethical significance.

2 The Origin of Inequality

One of the most consistent stylized facts of the contemporary global economy is the concentration of wealth and income in the hands of a vanishingly small elite. Empirical data across countries and decades show persistent Pareto-distributed income and wealth distributions, with increasingly thinner tails. A small minority holds a majority of productive physical capital, controls disproportionate flows of capital, and sustains this position across generations.

Yet paradoxically, as this phenomenon becomes more extreme, academic and policy discourse tends increasingly toward justification rather than structural critique. Even when proposals for addressing inequality are offered, they often remain in the realm of general principles or abstract ideals—emphasizing efficiency, incentives, or inclusive growth—without confronting the specific institutional arrangements that sustain concentration. The rhetorical move is subtle but effective: inequality is framed less as an anomaly to be corrected than as an inevitable byproduct of meritocratic allocation.

At the core of this rationalization lies a conflation of normative and descriptive propositions. The moral claim that “those who contribute more should receive more”—a principle of normative ordinality rooted in intuitive fairness—is transformed into a descriptive claim that those who have more must have contributed more. This slippage commits what philosophers call the naturalistic fallacy, and more specifically, a category error: mistaking a moral imperative for a statistical inference.

To infer from what ought to be, what is—and worse, to claim what is must be because it ought to be—is not logic, but moral sleight of hand.

The assertion that extreme economic outcomes reflect extreme differences in ability, effort, or contribution is empirically unsubstantiated. Research in biology, cognitive science, and behavioral psychology consistently finds that distributions of human ability and effort—however operationalized—cluster symmetrically around the median, with far less variance than that of observed wealth or income distributions. Outliers exist, but they are neither frequent enough nor extreme enough to account for the economic inequalities we observe.

To put it plainly: most people are more similar in capacity than different. While ability and effort may differ across individuals, those differences tend to fall within a narrow band. Wealth and capital, on the other hand, are distributed along a far more skewed axis—one that does not mirror the structure of human potential.

Ability and effort are approximately normally distributed around the median. Wealth is not. This is not a mathematical anomaly, but a structural and social fact.

The primary origin of inequality, then, is not variance in individual input, but asymmetry in structural mechanisms of distribution and accumulation. Among the most studied are:

Winner-takes-all dynamics, where marginal initial differences generate exponentially skewed outcomes.
Preferential attachment, where capital attracts capital by virtue of its existing mass.
Absorbing elite states, in which transitions out of the top wealth decile become statistically negligible.

These mechanisms can be captured through quasi-closed Markov chain models, calibrated on real-world capital flow data across individuals or firms. Even assuming comparable effort and ability across agents, these systems naturally generate persistent inequality through differential transition probabilities alone.

The system rewards contribution only partially—and selectively. Among many who contribute, only a few are elevated; and among those few, rewards often exceed any plausible measure of contribution. This is not merely inequality in outcome, but inequity in reward assignment.

3 Formalism as Obfuscation: The Limits of Mathematical Economics

Mainstream economic models frequently fail to account for the fundamental origins of inequality, not because the mathematics is insufficient, but because it is strategically simplified. The field has embraced a style of formalism that emphasizes ex post internal consistency while sacrificing ex ante explanatory relevance.

Mainstream models rely heavily on:

Closed systems with no structural innovation;
Symmetric interaction matrices, often assumed to be positive-definite;
Linearized dynamics near local equilibria, excluding global nonlinearity, bifurcation, or path-dependence;
Equilibrium-seeking behavior, despite the empirical prevalence of disequilibrium.

Mathematically, many such models reduce to the most simple form of Lotka–Volterra systems, which possess well-known properties:

Convergence to fixed points;
Absence of innovation;
Elimination of structural asymmetry by design.

When these dynamics are applied to complex social phenomena, they do not reveal hidden truths—they reaffirm hidden assumptions. The supposed “rigor” of the model becomes a veil behind which ideological commitments masquerade as neutral analysis.

This is not analytical clarity. It is the theater of rigor—a ritual performance in which precision displaces relevance, and formalism conceals structural omission.

Ultimately, this is not a failure of economics per se, but of economic epistemology. It is the result of a field that has:

Borrowed the symbols of mathematics without absorbing its disciplinary ethos;
Applied the tools of formal logic without asking what they conceal;
Substituted consistency for truth, and plausibility for justice.

Mathematics, when used properly, is a language of structure. However, in mainstream economics, it is too often a rhetorical tool of authority rather than an instrument of insight.