Home > Uncategorized > Mistaken methodologies of science 1

Mistaken methodologies of science 1

from Asad Zaman

The problem at the heart of modern economics is buried in the logical positivist methodological foundations created in the early twentieth century by Lionel Robbins. Substantive debates over the content actually strengthen the illusion of validity of these methods, and hence are counterproductive. As Solow said about Sargent and Lucas, you do not debate cavalry tactics at Austerlitz with a madman who thinks he is Napoleon Bonaparte, feeding his lunacy.  Modern Macro Models are based assumptions representing flights of fancy so far beyond the pale of reason that Romer calls them “post-real”.  But the problem does not lie in the assumptions – it lies deeper, in the methodology that allows us to nonchalantly make and discuss crazy assumptions. The license for this folly was given by Friedman: “Truly important and significant hypotheses will be found to have “assumptions” that are wildly inaccurate descriptive representations of reality”; see Friedman’s Methodology: A Stake through the Heart of Reason. In this sequence of posts, I will explain how economic methodology went astray in the 20th Century, abandoning empirical evidence in favor of mathematical elegance and ideological purity. Many authors have noted this problem — for instance, Krugman writes that the profession (of economists) as a whole went astray because they mistook the beauty of mathematics for truth (see Quotes Critical of Economics). To explain the flaws of economic methodology, we need to discuss the relationship between economic models and reality.  read more

  1. Frank Salter
    December 31, 2019 at 9:48 am

    I see the methodological problems very differently. Whatever method is used at the start is irrelevant as long as any hypothesis produced meets the empirical evidence and all quantitative mathematics conforms to the quantity calculus. The meta-descriptions used in the blog fail to describe these necessary conditions.

    Then it appears that economists fail completely to recognise the significance of the above requirements. One conclusion is that there is no valid orthodox nor heterodox quantitative analysis, though many readers of this blog recognise this. But the major failure is not to recognise valid theory even though it describes all the empirical evidence. A refer to my analysis of production theory, “Transient Development” RWER-81, pp, 135−167. It is the only quantitative analysis of production theory which passes the tests of the quantity calculus and corresponds exactly with the empirical evidence. It is plain and simple abstract production theory.

  2. December 31, 2019 at 6:55 pm

    Whatever the faults and shortcomings of Positivism, in describing the methods of mainstream economics, you are not describing Positivism. Any method that abandons empirical evidence in favor of mathematical elegance and ideology, is the opposite of Positivism.

    • Frank Salter
      December 31, 2019 at 7:40 pm

      I am in complete agreement with you but when valid quantitative theory is present mathematical elegance and empirical agreement will always occur together.

  3. January 2, 2020 at 8:01 pm

    It may have been Robbins who imported Logical Positivism into economics, but the philosophical foundations of that go back to David Hume, mentor of Adam Smith. An important connection, though. Interesting to compare what Asad is saying with the opening chapters of Lipsey’s textbook, “Introduction to Positive Economics” (my copy 7th edition, 1989); also with Shivgal’s thoughts on Robbins and how to get away from him at https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3275781/#__sec4title. (By time-sharing)?

    Frank may appreciate Lipsey’s Figure 1.1.

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