December 30, 2014

Corroboration and falsification

Comment on 'Mainstream macroeconomics distorts our understanding of economic reality'

You write: “Realism, can be many things.”

So, how many realities are there? I cannot remember that Lawson's ontology includes the claim that everybody is entitled to his own reality. Welcome to the Hicks-Drive-Club.

“Let us call the drive to nudge any question to the point of inconclusiveness, overload, or peaceful cohabitation of manifest contradictions the Hicks drive. It is a — spontaneous or conscious — scientific survival strategy because: “… you cannot prove a vague theory wrong.” (Feynman) See here.

And “By not strictly insisting on material and formal consistency Orthodoxy and Heterodoxy in effect cooperate on the widely visible crappyfication of economics.” See here.

Above, I have quoted the relationship between monetary profit, distributed profit, investment and saving. Each variable is measurable, thus the equation is testable in principle with the accuracy of two decimal places against Keynes's I=S.

That is scientific realism; and it has a unique answer; and the answer is that Keynes is falsified.

What next?

“In economics we should strive to proceed, wherever we can, exactly according to the standards of the other, more advanced, sciences, where it is not possible, once an issue has been decided, to continue to write about it as if nothing had happened.” (Morgenstern, 1941, pp. 369-370)

Time for Orthodoxy and Heterodoxy to leave the scientific Neanderthal.

Egmont Kakarot-Handtke

Morgenstern, O. (1941). Professor Hicks on Value and Capital. Journal of Political Economy, 49(3): 361–393. URL