December 31, 2014

Economics: science for the confused

Second comment on Peter Radford on  'DSGE is a plutocratic tool'


If, as Nixon's adviser Roger Stone once quipped, politics is Hollywood for the ugly, then economics is science for the confused.

“Thousands upon thousands of scholars, as well as thousands of statesmen and men of affairs, have contributed their efforts to the attempt to understand the course of events of the economic world. And today this field of investigation is being cultivated more extensively, than ever before. How is it, then, that in all these years, and with all the undoubted talent that has been lavished upon it, the subject of economics has advanced so little?” (Schoeffler)

Could it be that there is something deeply wrong with economics? Could it be that economics has never emancipated itself from agenda pushers of all sorts? Could it be that economists have caught themselves in the endless circle of apologetics and debunking? Could it be that economists feel quite at home in the 'thickness of confusion' (Suppes)?

Economists owe the world the true economic theory, that is, a theory that satisfies the scientific standards of material and formal consistency and that explains how the economy works.

When Joan Robinson summarized the output of political economics she needed only six words: Scrap the lot and start again!

If she had to characterize the current DSGE discussion one word would be enough.

Egmont Kakarot-Handtke