“In order to tell the politicians and practitioners something about causes and best means, the economist needs the true theory or else he has not much more to offer than educated common sense or his personal opinion.” (Stigum, 1991, p. 30)
Economists do not have the true theory, they merely have a heap of incoherent models. These models are stand-alone constructs that are not held together by an overarching theory. To begin with, the relationship between theory (e.g. gravitation) and model (e.g. solar system) is poorly understood. In economics one has models but no theory.
The models, in turn, are built upon premises that are methodologically unacceptable. As a rule, economists do not know what is in their models, see The future of economics: why you will probably not be admitted to it, and why this is a good thing.
The common logical blunder of Walrasians, Keynesians, Marxians, and Austrians is that the elementary concepts of profit and income are incorrectly defined. Yet, profit is the pivotal concept for the analysis of how the economy works. Without a correct profit theory, economics is vacuous. Conventional profit theory is logically indefensible and because of this, the familiar economic models fail to capture the essence of the market economy. There are many opinions but no scientific understanding of how the economy works.
In general, it holds that the representative economist is at best dimly aware of the crucial distinction between opinion and knowledge which constitutes science since Aristotle: “There cannot be both opinion and knowledge of the same thing at the same time.” (Posterior Analytics, Wikipedia)
The discussion of Paul Krugman, Larry Summers, and Brad DeLong about methodology is roughly on the level of medieval witch hunters who exchange their opinions about whether the incubus or the succubus is a greater threat to humanity.
The scientific embarrassment of this sitcom consists of the plain fact that economists have no idea of what is in their logically defective, i.e. provable false, models.
Egmont Kakarot-Handtke
References
Stigum, B. P. (1991). Toward a Formal Science of Economics: The Axiomatic Method in Economics and Econometrics. Cambridge: MIT Press.
Related 'Economics is NOT a science of behavior' and 'Towards the true economic theory' and 'How economists became the scientific laughing stock' and 'The Ur-Blunder of economics and its rectification' and 'One entirely sufficient reason for the shutdown of economics'.
