May 6, 2017

Feynman Integrity, fake science and the econoblogosphere

Comment on Jason Smith on ‘You’re wrong because I define it differently’


The state of economics is this: there is political economics and theoretical economics. The main differences are: (i) The goal of political economics is to successfully push an agenda, the goal of theoretical economics is to successfully explain how the actual economy works. (ii) In political economics anything goes; in theoretical economics the scientific standards of material and formal consistency are observed.

The state of economics is this: theoretical economics (= science) had been hijacked from the very beginning by political economics (= agenda pushers). Political economics has produced NOTHING of scientific value since Adam Smith. As a result of the utter scientific incompetence of political economists economics is a failed science.

The state of economics is this: economics needs a paradigm shift because the four main approaches ― Walrasianism, Keynesianism, Marxianism, Austrianism ― are mutually contradictory, axiomatically false, materially/formally inconsistent and all got the pivotal economic concept profit wrong: “... suppose they did reject all theories that were empirically falsified ... Nothing would be left standing; there would be no economics.” (Hands)

Economics is indefensible but economists either do not realize it, do not admit it, excuse it,#1 or have no idea how to get out of the mess: “… most economists neither seek alternative theories nor believe that they can be found.” (Hausman)

Accordingly, economists defend the status quo and thereby ― knowingly or unknowingly does not matter ― actually violate scientific standards. As Morgenstern reminded his colleagues already in the 1940s: “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.”

Economists simply ignore formal or empirical refutation and carry on “as if nothing had happened.” The four main approaches agree on one ― methodologically incorrect but politically convenient ― point: the pluralism of false theories. What is in dispute between the orthodox majority and the heterodox minority is merely the partitioning of the academic trough/curriculum between the schools.

Economics is axiomatically false, that is, it is beyond repair. Accordingly, there is no progress at all in orthodox economics since 140+ years only the senseless multiplication of silly models which are based on the maximization-and-equilibrium axiom set.

Economics is what Feynman called a cargo cult science and he characterized it thus: “They’re doing everything right. The form is perfect. ... But it doesn’t work. ... So I call these things cargo cult science, because they follow all the apparent precepts and forms of scientific investigation, but they’re missing something essential.”

What is missing is the true theory: “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)

Because economists lack the true theory their policy guidance never had sound scientific foundations. Since 200+ years economics is model bricolage, soap box blather, inconclusive debate, or agenda pushing. More often than not, economic policy advice worsens the situation.

Paul Romer reminded Lucas and the DSGE crowd that with clinging to their intransparent mathiness they violate Feynman Integrity.#2 The absurdity of Romer’s convoluted argument consists in the fact that not only DSGE but ALL of economics, including his own, violates Feynman Integrity.

What Feynman had to say about cargo cult science was this: “So we really ought to look into theories that don’t work, and science that isn’t science.” With regard to economics this means that nothing less than a paradigm shift will do.

In very practical terms, this means the promotion of fundamentally new approaches (non-Walrasian, non-Keynesian, non-Marxian, non-Austrian) and the elimination of the falsified approaches (Walrasian, Keynesian, Marxian, Austrian) and all their pseudo-innovative variants. What can be observed in the econoblogosphere is the very opposite.

The loudspeakers of the profession play the scratch-my-back-and-I-scratch-yours recommendation and reputation game peppered occasionally with a piece of tangential critique. This pygmy-wrestling is what the public sees and enjoys. What the public does not see is that the loudspeakers of the profession actively push/censor/purge/retrofit their blogs in order to perpetuate the status quo of the pluralism of false theories.

The result is that the public regularly sees a Top-Ten list of the most popular blogs/bloggers but never a Top-Ten list of the worst violators of Feynman Integrity.

Egmont Kakarot-Handtke

#1 See 'Failed economics: The losers’ long list of lame excuses'
#2 Paul Romer ‘Feynman Integrity

Related 'Macro imbeciles' and 'IS-LM ― a crash course for EconoPhysicists' and 'Economics, Plato’s Cave and the Silver Blaze Case' and 'Economics ― worse than fake' and 'When fake scientists call out on fake politicians' and 'Pre-truth and post-truth in economics' and 'Humpty Dumpty is back again'