June 3, 2017

Let Chicago economics rest in peace

Comment on Lars Syll on ‘Chicago-inspired methodology’


The key message of traditional Heterodoxy is that orthodox/mainstream economics is false. This is correct but curiously, since Veblen’s fundamental critique of Orthodoxy, Heterodoxy has never come up with the true theory: “As will become evident, there is more agreement on the defects of orthodox theory than there is on what theory is to replace it: but all agreed that the point of the criticism is to clear the ground for construction.” (Nell)

Construction, though, never happened. Instead of following the scientific protocol and performing the necessary paradigm shift Heterodoxy advocates methodological anything-goes and the pluralism of false theories.#1

The repetitive critique of silly DSGE models has run its course by now: “The moral of the story is simply this: it takes a new theory, and not just the destructive exposure of assumptions or the collection of new facts, to beat an old theory.” (Blaug)

The economist who does not understand that the actual state of orthodox and heterodox economics is that of a failed science is a moron. The economist who does understand that Walrasianism, Keynesianism, Marxianism, Austrianism, and Pluralism is proto-scientific garbage but still defends one of these approaches and claims to do science is a fraudster.#2

Accordingly, the three career paths open to the economist are currently: (i) moron, (ii) fraudster, or (iii) paradigm shifter.#3 To continue criticizing Chicago economics is NOT an option because this approach is dead already for 150+ years.

Egmont Kakarot-Handtke

#1 How Heterodoxy became the venue for science’s scum
#2 Needed: the Top Ten of substandard economics blogs
#3 First Lecture in New Economic Thinking