Science is about true/false and it is well-known how to arrive at a clear-cut decision between the two: “Research is, in fact, a continuous discussion of the consistency of theories: formal consistency insofar as the discussion relates to the logical cohesion of what is asserted in joint theories; material consistency insofar as the agreement of observations with theories is concerned.” (Klant, 1994, p. 31)
While the scientific methodology is pretty obvious in general it says, of course, nothing about how to proceed in the concrete case. It is the researcher who combines induction and deduction in a unique way in order to solve the problem on hand. “The next scheme, the new discovery, is going to be made in a completely different way. So history does not help much.” (Feynman, 1992, p. 164)
Therefore, here is the first critical hazard: instead of keeping the balance on the tightrope the incompetent researcher tumbles down either on the side of vacuous deductivism or on the side of blind empiricism.
Methodology is not prescriptive in the concrete case, it defines only a green range of what is acceptable and, by implication, the complementary red range of what is unacceptable. Methodology is prescriptive in the concrete case insofar as it enforces or helps to enforce logical and material consistency.
The characteristic of science is to focus and to clarify and to specify with ever increasing precision in order to eventually arrive at a clear-cut answer. Thus, science separates the gold of knowledge from the rubble of opinion. Vagueness/undecidability is the very antithesis of science: “Another thing I must point out is that you cannot prove a vague theory wrong.” (Feynman, 1992, p. 158). The very ambition of science is to get out of the cacklers’ paradise between true and false where “nothing is clear and everything is possible.” (Keynes, 1973, p. 292)
Now, science does not operate undisturbed in a guarded retreat but in an open social landscape that is shaped by antagonistic political forces. Politics cannot do other than to try to draw the different sciences in different degrees into the battle, which means that science is weaponized. This happened to economics which started as Political Economy and, despite attempts to satisfy scientific standards, it never achieved the ideal state of the full independence of a genuine science. So what we have today is political economics and theoretical economics, with the former dominating the latter. Political economics has produced nothing of scientific value since Adam Smith.
The goal of political economics is to stay in the realm between true/false where opinion thrives and to gain more ground there. The goal of theoretical economics is to focus on the development of the formally and materially consistent theory of how the actual economy works. Theoretical economics is hampered by ongoing massive distraction. The weapons of mass distraction are:
- To do away with the ‘regulative idea’ (Popper, 1994, p. 161) of truth (= formal and material consistency) with the assertion that there are many truths in economics and that they can coexist under the rainbow banner of pluralism and eclecticism.
- Declaring deductivism and inductivism as antagonistic instead of complementary.
- Playing ‘with the net down’ (Blaug), i.e. softening scientific standards or ignoring/ denying them altogether.
- Being content with a plausible narrative/model.
- Arbitrariness/sloppiness in the definition of elementary concepts.
- Inconsistency of foundational propositions, a.k.a. axioms.
- Folk psychology, i.e. second-guessing the scientifically inaccessible motives and intentions of other people in general and of economic agents in particular (utility maximization, bounded rationality, animal spirits, rational expectations, etc).
- Folk sociology, i.e. second-guessing the scientifically inaccessible motives and intentions of real or fictional social subgroups (one-percenters, capitalists, workers, consumers, middle class, bankers, etc).
- Folk politics, i.e. second-guessing the scientifically inaccessible motives and intentions of actual or historical political actors of all forms and shapes from heads of state via legitimate/illegitimate institutions/organizations to the lone nut.
- Missing the subject matter of economics altogether (= the actual monetary economy as a whole) and getting lost in the so-called social sciences.
Feynman, R. P. (1992). The Character of Physical Law. London: Penguin.
Keynes, J. M. (1973). The General Theory of Employment Interest and Money. The Collected Writings of John Maynard Keynes Vol. VII. London, Basingstoke: Macmillan.
Klant, J. J. (1994). The Nature of Economic Thought. Aldershot, Brookfield, VT: Edward Elgar.
Popper, K. R. (1994). The Myth of the Framework. In Defence of Science and Rationality., chapter Models, Instruments, and Truth, pp. 154–184. London, New York, NY: Routledge.