January 12, 2016

Economics: of the stupid by the stupid for the stupid

Comment on Peter Radford on ‘Lamppost Economics?’

Blog-Reference

With regard to the habitual lack of interest of the economics profession in distributional issues you sum up “I may be misreading this, but what I think Krugman is telling us that only subjects that can be scrunched into models are suitable material for economic. ... Now I am lot more sympathetic towards Krugman than many of you are, I have a soft spot for his thinking because he is willing to lead the liberal charge, but this annoys me.” (See intro)

And you end with citing Fox’s concluding paragraph: “... I can’t help but wonder what important knowledge the economists are inadvertently suppressing today.”

Here is the important knowledge for all non-economists:
(i) Economics is a failed science and the majority of economists has not realized this.
(ii) Economists do not assess models/theories according to the scientific criteria true/false but according to political sympathies/antipathies for Liberalism, Communism, etcetera.
(iii) In more than 200 years economists have not risen above the proto-scientific level of political economics.
(iv) It is not at all important whether Krugman has said something about distribution before it became fashionable but whether this had any scientific value. All the more so, as it is well-known that Krugman is not a particularly sharp thinker (2014a).
(v) The fact of the matter is that the profit theory is false since Adam Smith (2014b). This means that neither Krugman nor his critics have any idea of the pivotal phenomenon of the market economy. Because profit theory is provable false distribution theory and all the rest is false, too.
(vi) Economists do not inadvertently suppress knowledge — they have none at all. This is not because models are applied selectively but because they are logically defective and this, in turn, is due to incurable scientific incompetence.
(vii) Because of this, it is of no use that economists busily produce more distribution models — or any other for that matter. The world has too much of this proto-scientific garbage.*

Egmont Kakarot-Handtke


References
Kakarot-Handtke, E. (2014a). Mr. Keynes, Prof. Krugman, IS-LM, and the End of Economics as We Know It. SSRN Working Paper Series, 2392856: 1–19. URL
Kakarot-Handtke, E. (2014b). The Profit Theory is False Since Adam Smith. What About the True Distribution Theory? SSRN Working Paper Series, 2511741: 1–23. URL

* See ‘How the intelligent non-economist can refute every economist hands down

Related 'Addendum to ‘Musings on Whether We Consciously Know More or Less than What Is in Our Models