Blog-Reference
Science is about truth/knowledge, politics is about belief/opinion. Science appeals to logical/empirical proof, politics appeals to emotion, and good-guy/bad-guy moralizing. Economics is a failed science on one level with the Flat Earth Theory, economists are fake/cargo cult scientists. Walrasianism, Keynesianism, Marxianism, Austrianism has NO truth-value, only some political use-value.
Standard economics is built upon this set of foundational propositions, aka neo-Walrasian axioms: “HC1 economic agents have preferences over outcomes; HC2 agents individually optimize subject to constraints; HC3 agent choice is manifest in interrelated markets; HC4 agents have full relevant knowledge; HC5 observable outcomes are coordinated, and must be discussed with reference to equilibrium states.” (Weintraub)
These premises contain three plain NONENTITIES (constrained optimization HC2, rational expectations HC4, equilibrium HC5) and therefore are forever unacceptable. Being incompetent scientists, though, economists swallowed this inane stuff hook, line, and sinker from Jevons/Walras/Menger onward to DSGE.
In methodology it holds, when the axiomatic foundations are false the whole analytical superstructure is false. So, General Equilibrium, Pareto Optimality, the Welfare Theorems, the Coarse Theorem, the concept of Market Failure are all elements of what is an economic Flat Earth Theory.
Make no mistake, whoever accepts only one axiom of the set HC1/HC5 proves that he is a scientific deadhead.
Since Newton made faux humility popular with his “If I have seen further it is by standing on the shoulders of Giants” all intellectual dwarfs desperately try to convince the general public, which simply cannot assess genuine scientific merit, that they are standing on the shoulders of geniuses.
This is where attention managers, cheerleaders, and claqueurs like Barkley Rosser have to bring in their talents. Being himself a Flat Earther he simply cannot resists awarding the fake Nobel posthumous to a fellow fake scientist like Francis Bator whose claim to the title of useful idiot rests on the fact that he is best known “as an economic and national security adviser to LBJ in the 1960s.”
To abuse an obituary for great-man myth creation is a tried and tested ― but nonetheless forever reprehensible ― PR stunt. The fact is that standard economics is a scientific failure and no orthodox/heterodox economist will ever be accepted to the pantheon of science.
Egmont Kakarot-Handtke
Related 'Are economists natural born scientific failures?'. For details of the big picture see cross-references Failed/Fake Sciences.
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COMMENT on Peter Dorman on Mar 23
You say: “My view is that Bator’s list of canonical market failures leaves out perhaps the most important of all, nonconvexities and multiple equilibria.”
Equilibrium is one of the neo-Walrasian axioms (see HC5 above). It is a lethal methodological blunder to put equilibrium into the premises. This idiocy/fraud is known since antiquity as petitio principii.#1
Joan Robinson put it thus: “Economic theorists should not make such a production about taking a rabbit out of a hat after having put the rabbit into the hat in full view of the audience.”
Equilibrium is not a feature of economic reality, it is the rabbit that has been put into the hat as an inadmissible axiom. Because equilibrium does not exist, general equilibrium does not exist, and multiple equilibria, too, do not exist.
Methodologically, multiple equilibria are analogous to the epicycles of geo-centrism.
The fact of the matter is that the market system is inherently unstable. It either explodes or implodes, albeit in slow motion and overlaid by cycles, so that the underlying instability is normally imperceptible.
Because the idea of an underlying tendency towards general equilibrium is false, the concept of market failure, which makes only sense in relation to GE, makes no sense at all, it is a self-created pseudo-problem. The market system as a whole is structurally/ functionally defective because it has some positive feedback loops built right into its core.#2
Standard economics is one of the worst cases of theory failure of all times and you are part of it.