Schools of Thought EXAMPLE 4
Green says:
If a tobacco company advertises, its sales will increase.
All tobacco companies advertise.
Therefore, prohibition of advertising would reduce sales of tobacco.
There is an unspoken step, here. Green thinks that the tobacco industry as a whole sells more tobacco than it would sell in the absence of advertising. Let's see how he might respond to that criticism:
Brown says:
Are you sure that the overall sales of tobacco are greater on account of advertising than they would be if tobacco companies did not advertise?
Green says:
If each company sells more, then the total sales must be more, right? It's simple addition!
Brown responds:
Not necessarily. An individual company might be able to sell more by taking customers away from the other companies. But they all can't do that at the same time. It's possible that, when they all advertise, those advertisements just cancel out -- leaving the same total sales as before.
Brown has undercut Green's reasoning. This illustrates the fact that Green's argument was and is defeasible. But that doesn't mean that Green was wrong. Advertising may cancel out or it may not -- some nonsmokers may be persuaded to smoke if the industry advertises more -- and Green could rescue his argument by giving us some reason to believe that Brown is wrong, and that not all advertising would cancel out. Green would then have undercut Brown's undercutter.
Nevertheless, Green's argument, as he originally stated it, contained a fallacy. It is an important fallacy for economics, too, and is called the fallacy of composition. To commit the fallacy of composition is to reason that what one family or company can (or should) do also can (or should) be done by a whole group of families or companies. This is a fallacy because it ignores the possibility that the group of families or households may interact (for example, taking away customers from one another) so that the group works differently than an individual does. Since interactions of this kind are very common in economics, the fallacy of composition is one we have to be on the look-out for.
In critical reasoning more generally, the fallacy of composition would be an example of an informal fallacy, that is, reasoning that does not directly violate any rules of logic, but is hasty and inconclusive. One of the objectives of critical reasoning is to find and (if possible) repair informal fallacies.
From the point of view of rational dialog, Brown has done Green a favor, by giving Green an opportunity to make his argument stronger and more conclusive -- if in fact it is correct.
But now let's apply these ideas by exploring ideas from one particular school of thought -- a key school of thought in twentieth century economics -- the Neoclassical Economists.We next explore some of the major schools of thought in economics, to put the Neoclassical School in context. The chapter to follow will discuss the basic ideas of the Neoclassical school in more detail.
