Scientists and science actors

Comment on Lars Syll on ‘Chicago drivel — a sure way to get a ‘Nobel prize’ in economics’

Blog-Reference and Blog-Reference

Personal experience makes only a tiny part of what every human knows about the world/ universe and other humans, the greater part stems from myth/religion/philosophy/ science. Myth/religion/philosophy is storytelling and does not satisfy the scientific criteria of logical and empirical consistency. Storytelling is easy, to establish consistency is hard. From the history of the last 5000 years, we know that stories sell well, the absurder the better. The average person prefers belief/opinion (= doxa) to knowledge (= episteme) and thinks more about natural/supernatural persons/personifications and less about the universe and its sub-systems. Because of this, nearly 100 percent of human communication consists of gossip.

A case in point is economics. What Thomas Sargent tells his students boils down to: (i) humans respond to incentives, (ii) one cannot always get what one wants, (iii) in equilibrium economic agents are satisfied, (iv) sometimes people/governments keep their promises, sometimes not, (v) people try to get more out of the social pot than they put in, (vi) it is difficult/impossible to know other peoples’ motives/preferences and to forecast their actions. (See intro)

This is folk psychology and folk sociology — PsySoc for short. The economist Sargent tells his students how humans work but not how the economy works. The main reason is that Sargent and his fellow economists at Chicago, Berkeley, Harvard, and elsewhere do not know how the economy works.

This would not be a big issue, after all, people talk most of the time about NONENTITIES and things they know nothing about. To believe in standard economics is in no way different from the belief in the myths of ancient goat herders. The real trouble with economics begins here: “Bank of Sweden Prize in Economic Sciences in Memory of Alfred Nobel”.

The keyword is science[s]. Why not simply “Bank of Sweden Prize in Economics”? The original title clearly communicates the claim that economics is a science. This claim is as old as Adam Smith/Karl Marx. But economists never lived up to the claim.

Science is well-defined by the criteria of formal and material consistency: “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)

Neither orthodox nor heterodox economics satisfies the criteria of formal and material consistency. Worse, economists violate scientific standards since the founding fathers. There is no exception: Walrasian, Keynesian, Marxian, or Austrian economics is provably inconsistent.

There are political economics and theoretical economics. The founding fathers were straightforward people and called themselves political economists, that is, they left no doubt that their main business was agenda pushing. Economists never got out of political economics. In other words, theoretical economics (= science) ultimately could not emancipate itself from political economics (= agenda-pushing). And this is how economics became one of the most embarrassing failures in the history of scientific thought.

Economics is not a science, but what Feynman famously called a cargo cult science. Accordingly, economists are not scientists but science actors. The difference is this: “A genuine inquirer aims to find out the truth of some question, whatever the color of that truth. ... A pseudo-inquirer seeks to make a case for the truth of some proposition(s) determined in advance. There are two kinds of pseudo-inquirer, the sham and the fake. A sham reasoner is concerned, not to find out how things really are, but to make a case for some immovably-held preconceived conviction. A fake reasoner is concerned, not to find out how things really are, but to advance himself by making a case for some proposition to the truth-value of which he is indifferent.” (Haack, 1997, p. 1)

Not only the Chicago version but economics in all its orthodox and heterodox variants is unacceptable proto-scientific garbage. The first thing to do is to rename the most prestigious economics prize into “Bank of Sweden Oscar for the best science actor/actress.”

Egmont Kakarot-Handtke


References
Haack, S. (1997). Science, Scientism, and Anti-Science in the Age of Preposterism. Skeptical Inquirer, 21(6): 1–7. URL

Related 'Feeble minds, shaky assumptions, and the inevitable failure of economics' and 'How to get out of the Econ 101 PsySoc woods' and 'Economics is NOT a science of behavior' and 'From PsySoc to SysHum' and 'The happy end of the social science delusion' and 'The Science-of-Man fallacy' and 'PsySoc — the scourge of economics' and 'A farewell to PsySoc economics'.

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REPLY to Peter on Sep 21

Your argument adds nothing to the discussion but distracts from the main point. The question is: Is the theory/model true or false. The character of the author, his CV, and what his motives might be is ultimately irrelevant. Science is about proof and not about personality or credibility.

“Remember: occasionally, it may be an interesting question to ask why a man says what he says; but whatever the answer, it does not tell us anything about whether what he says is true or false.” (Schumpeter)#1

Chicago economics is provably false. The same holds for Cambridge economics. It is irrelevant whether Cambridge is regarded as politically more leftist and Chicago more rightist. The point is that both Chicago and Cambridge produce proto-scientific garbage.


#1 See also the first 60 seconds of Feynman on Scientific Method on YouTube

Economics is NOT about Human Nature but the economic system

Comment on Bill Mitchell on ‘Humans are intrinsically anti neo-liberal’

Blog-Reference and Blog-Reference

For little children, the primary layer of reality is the social here-and-now ― mom, pop, family, and neighborhood. The insight that the tiny social bubble is embedded in the non-social reality of the region, earth, universe, and their past and future development comes later. Most people do not get far beyond the infantile layer of reality: “Perhaps it is because their horizons are limited in this way that some people are able to imagine that the centre of the universe is man.” (Feynman)

In the myopic human-centered worldview, learning and knowledge relate primarily to the properties/motives/behavior/actions of other humans. In the universe-centered worldview, learning and knowledge relate primarily to the properties/‘behavior’ of Non-human Nature. In very general terms, this gives us two fundamentally different realms: politics and science. It is of utmost importance to keep both realms separated because they are governed by mutually exclusive principles. The accepted currency in the political realm is opinion (= doxa), and the accepted currency in the scientific realm is knowledge (= episteme).

In economics, the proper separation never took place. There have always been two economixes, political economics, and theoretical economics. The main differences are: (i) The goal of political economics is to successfully push an agenda, and the goal of theoretical economics is to successfully explain how the actual economy works (= true theory). (ii) In political economics, anything goes; in theoretical economics, scientific standards are observed. The fact is that (i) theoretical economics (= science) had been hijacked from the very beginning by political economists (= agenda pushers), and (ii) political economics has produced NOTHING of scientific value in the last 200+ years.

The underlying worldview of political economics is, of course, human-centered. Accordingly, the issues have been folk-psychological, folk-sociological, and folk-biological: self-interest, greed, utility maximization, profit maximization, rent-seeking, moral hazard, bounded rationality, animal spirits, honesty/trust/corruption, power/freedom/oppression, individualism/collectivism, competition/cooperation, the survival of the fittest, and so on.

ALL definitions of economics implicitly or explicitly contain a Human-Nature core.

• “It is a touchstone of accepted economics that all explanations must run in terms of the actions and reactions of individuals. Our behavior in judging economic research, in peer review of papers and research, and in promotions, includes the criterion that in principle the behavior we explain and the policies we propose are explicable in terms of individuals, not of other social categories.” (Arrow)
• “Economics is the science which studies human behavior as a relationship between ends and scarce means which have alternative uses.” (Robbins)
• “The science which traces the laws of such of the phenomena of society as arise from the combined operations of mankind for the production of wealth, in so far as those phenomena are not modified by the pursuit of any other object.” (Mill)

The common denominator of the different schools of economics is human-centric. This is the ultimate axiom of economics and defines it as a so-called social science. Where the schools differ is what true Human Nature is or should be.

It is also obvious that ALL definitions of economics contain the commitment to science.

The fact is, though, that economics is a failed science. The major approaches ― Walrasianism, Keynesianism, Marxianism, Austrianism ― are mutually contradictory, axiomatically false, materially/formally inconsistent, and ALL got the foundational economic concept of profit wrong. #1 After 200+ years, economics is still at the level of a proto-science or what Feynman called a cargo cult science.

What neither orthodox nor heterodox economists have realized is that their definition of the subject matter is methodologically unacceptable. All Human-Nature issues are the subject matter of other disciplines, that is, Psychology, Sociology, Political Science, Anthropology, History, Biology, etc. The subject matter of economics is the structure/ behavior of the economic system, which is an objective non-human entity. The outstanding characteristic of the representative economist is that he dabbles for 200+ years in all Human-Nature disciplines but has NO idea how the economic system works. The fact is that the representative economist does not even know what profit is. #2 

Because economic theory has NEVER been true, economic policy guidance NEVER had sound scientific foundations. The scientific incompetence of economists consists in the fact that they have defined economics as a so-called social science instead of systems science and that they have not realized their fundamental methodological blunder to this day. #3 Since Adam Smith/Karl Marx, economics has been political economics, and ALL political economics is scientifically worthless.

Egmont Kakarot-Handtke


#1 Including MMT see Where MMT got macro wrong
#2 Essentials of Constructive Heterodoxy: Profit
#3 The Science-of-Man fallacy

Related 'If we only had classes' and 'Economics is NOT about what Happiness is but about what Profit is' and 'MMTers: too much thought-reading, too little thinking' and 'From Keynes’ fatal blunder to the true economic model'. For details of the big picture, see cross-references Not a Science of Behavior and cross-references Political Economics/Stupidity/Corruption.

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Graphic AXEC121g

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COMMENT on Tom Hickey on May 23

You say: “Training children in this is part of the socialization process, and those that don't get become life-long brats that are always taking and never give, or when they give it is not really reciprocating. They get a reputation for being assholes.”

This is a fine piece of folk psychology/sociology. The question is, is it relevant to economics? Not at all! The insight that there are assholes in the world ― to which everybody can readily agree from their own experience ― does NOT advance our understanding of how the actual economy works. Just the opposite. Psychology/sociology are NOT the subject matter of economics but a distraction from the real issues, which, as we all know by now, have led economics into the coal pit of cargo cult science. #1

Keynes, famously, gave a definition of what the centerpiece of economics is: the monetary theory of production. Note that this definition of the subject matter eliminates a lot of garbage that has always been dear to mentally retarded economists. Barter, for example. But, more importantly, it eliminates ALL psychological and sociological issues. In contradistinction to the neoclassical utility maximizers, Keynes correctly defined economics as a systems science.

In order not to fall behind Keynes, the PsySoc-Ban has to be issued as one of the Ten Commandments of Economics: Leave all psychological, sociological, anthropological, biological, etc. issues to psychology, sociology, anthropology, biology, etc.

The PsySoc-Ban has tremendous consequences because standard economics is built upon this set of behavioral 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)

The PsySoc-Ban bans the neoclassical approach from economics ― completely from supply-demand-equilibrium to DSGE. So, there is absolutely NO need to reenact Groundhog Day and to moralize again and again about constrained optimization, greed, or individualism.

The PsySoc-Ban, though, has one important methodological implication: “The problem is not just to say that something might be wrong, but to replace it by something ― and that is not so easy.” (Feynman)

So, the all-decisive question is: is MMT the replacement of obsolete neoclassical economics?

No! MMT, just like PsySoc standard economics, is axiomatically false.#2 This brings us to the question, why does Bill Mitchell waste so much time kicking a dead horse instead of correcting the provably false formal foundations of MMT?


#1 “... but when the road ends at a coal-pit, he [the traveler] doesn’t need much judgment to know that he has gone wrong, and perhaps to find out what has led him astray.” (Hume)
#2 See also Going beyond Wicksell, Keynes and MMT.

PsySoc — the scourge of economics

Comment on David Ruccio on ‘The fundamental truth about American economic growth’

Blog-Reference

You quote a recent Science article: “... that we’re seeing right now, with the insurgent campaigns of Donald Trump and Bernie Sanders and elite hopes that they will just fade away, are ‘early skirmishes in a coming class war’.” (See intro)

It is not so much the prediction of a coming class war in the U.S. that is false but the explanation within the framework of economics.

The crucial point is that economics deals — in the first place — not with individual human behavior or society at large. This is the realm of Psychology, Sociology, Anthropology, History, Political Science, Philosophy, etcetera. Insofar as economics deals with behavioral assumptions like utility maximization, greed, power-grabbing, etcetera, it is a dilettantish variant of Psycho-Sociology or PsySoc.

The authors of the Science article argue that it is wrong to explain the problems of the U.S. economy by ‘pathologizing the poor’ and that it is necessary to turn ‘attention to the pathologies of the rich.’ (See intro)

It should be pretty obvious that economic problems cannot be explained or solved by Psychology. It is known since the ancient Greeks that psychologism is the way stupid people explain the world, i.e. flashes of lightning fly from the sky because Zeus is angry. The pathology explanation is on the same scientific level as the Zeus explanation, that is, it is exactly at intellectual ground zero.

There is some irony in the fact that the most famous predictor of imminent class war had been very explicit about the vacuousness of psychologism: “To prevent possible misunderstanding, a word. I paint the capitalist and the landlord in no sense couleur de rose. But here individuals are dealt with only in so far as they are the personifications of economic categories, embodiments of particular class-relations and class-interests. My stand-point, from which the evolution of the economic formation of society is viewed as a process of natural history, can less than any other make the individual responsible for relations whose creature he socially remains, however much he may subjectively raise himself above them.” (Marx, 1906, M.9)

On closer inspection, however, Marx only replaced subjective psychologism with objective sociologism. Instead of pathological individuals we now have ‘embodiments of economic categories.’ This is somewhat better but still not good enough. What, then, is the real subject matter of economics?

As a first approximation, one can agree on the general characteristic that the economy is a complex system.

However, with the term system, one usually associates a structure with components that are non-human. In order to stress the obvious fact that humans are an essential component of the economic system, the market economy should be characterized more precisely as a complex hybrid human/system entity or SysHum.

The scientific method is straightforwardly applicable to the sys-component but not to the hum-component. While it is clear that the economy always has to be treated as an indivisible whole, for good methodological reasons the analysis has to start with the objectively given system components. The economic system has its own logic which is different from the behavioral logic of humans. Systemic logic is what Adam Smith called the Invisible Hand.

The history of the U.S. economy since around the 1920s could be retold quite realistically as tumbling from crisis to crisis with idiots, criminals, sociopaths, swindlers, fakers, etc. grabbing for power and money.

To do so, however, is not the proper task of Theoretical Economics. Economics has to explain how the actual economic system works and this implies explaining economic crises or an eventual breakdown by structural defects and not by psychological or social pathologies (2015; 2014). In other words, the pain comes from the broken leg and not from evil spirits. The economy breaks down because of the overall loss, and society breaks down for other reasons. These things have to be kept properly apart.

This said, is not to deny that Donald Trump could be the harbinger of the economic and intellectual breakdown of the U.S. To be quite clear, this is a serious problem of Political Science but by no stretch of the imagination of Theoretical Economics, which is science in marked contrast to Political Economics, which is — and that is the fundamental truth —  folk-psychological garbage and brainless gossip.

Egmont Kakarot-Handtke


References
Kakarot-Handtke, E. (2014). Mathematical Proof of the Breakdown of Capitalism. SSRN Working Paper Series, 2375578: 1–21. URL
Kakarot-Handtke, E. (2015). Major Defects of the Market Economy. SSRN Working Paper Series, 2624350: 1–40. URL
Marx, K. (1906). Capital: A Critique of Political Economy, Vol. I. The Process of Capitalist Production. Library of Economics and Liberty. URL

Related 'Economics: ‘a tale told by an idiot, full of sound and fury’?' and 'Confounding sociology and economics' and 'The happy end of the social science delusion' and 'Economics: the honeypot for know-nothingers' and 'Love and hate in economics: the PsySoc shell game' and 'Hijackers, agenda pushers, PsySocs and other morons' and 'How to get out of the Econ 101 PsySoc woods' and 'Economics is NOT a social science' and 'Psychologism: how morons explain the world'. For details of the big picture see cross-references Not a Science of Behavior.

Paul’s and Stephanie’s economic delirium talk

Links on Stephanie Kelton’s ‘Paul Krugman Asked Me About Modern Monetary Theory. Here Are 4 Answers.’

Blog-Reference and Blog-Reference on Mar 5

First answer: “Fiscal policy works by driving income into people’s pockets.”
False. Instead: “MMT deficit-spending/money-creation works by driving profit into rich people’s pockets.”

Stephanie Kelton is a scientifically incompetent agenda pusher for the Oligarchy:
► Stephanie Kelton’s legendary Plain-Sight-Ink-Trick
► The Kelton-Fraud
► Down with idiocy!
► Economists: Either stupid or corrupt or both
► How counterfeiters save America with an extra profit and make WeThePeople pay for it
► MMT for beginners

Paul Krugman, of course, is already a little longer known as a failed/fake scientist (see Related).

Egmont Kakarot-Handtke


Related 'Mr. Keynes, Prof. Krugman, IS-LM, and the End of Economics as We Know It' and 'Krugman vs MMT ― like the blind talking about colors' and 'Economics: A pointless left-right wrestling show' and 'Krugman and the scientific implosion of economics' and 'Paul Krugman and economic poultry entrails reading' and 'Enough! Economists, retire now!' and 'Just another wreck' and 'The Krugman curse' and 'Krugman is not an economist' and 'Not a question of simplicity but of stupidity' and 'The general theory of scientific incompetence' and 'Is Paul Krugman necessary?' and 'When fake scientists call out on fake politicians' and 'On economists’ stupidity' and 'Paul the Menace' and 'Economics and corruption' and 'Forget Krugman, forget Keynes, forget economists' and 'Hooray! The formalization issue is finally settled' and 'Dear idiots, government deficits do NOT cause inflation' and 'MMT-Refutation for Dummies' and 'The clock runs down on economics'.

For more on Kelton see AXECquery.

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REPLY to Noah Way, Konrad, Detroit Dan, Ralph Musgrave, S400 on Mar 2

The notation of the sectoral balances equations is as follows
MMT (I−S)+(G−T)+(X−M)=0
AXEC (I−S)+(G−T)+(X−M)−(Q−Yd)=0.

Because the MMT equation is provably false (it describes a zero-profit economy), the whole of MMT is false. As a consequence, MMT and its proponents are flushed down the scientific toilet. This is how mental hygiene works. And this is how science has worked for 2300+ years.

Genuine scientists settle matters by material/formal refutation and then move on to a superior approach. To this day, economists are unable to get out of their proto-scientific delirium. #1 Paul Krugman, Stephanie Kelton, and you are the living proof.


#1 Economists: Either stupid or corrupt or both

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REPLY to Calgacus on Mar 2

People who invoke Jesus in an economic argument have disqualified themselves and are NOT allowed to utter any methodological pronouncements.#1

Obviously, you cannot stop making a fool of yourself: “Egmont, people are trying to make a point I have made in vain to you. These equations are meaningless if you don’t define your terms.”

Guess what, Calgacus and other people who invoke Jesus and cannot put 2 and 2 together: the variables in the AXEC sectoral balances equations are axiomatically well-defined, identical with the subset of the MMT equation, and measurable with the precision of two decimal places. #2, #3, #4, #5

So, if the subset of variables in the MMT equation is correctly defined, then the same set of variables in the AXEC equation is also correctly defined. The AXEC set contains, in addition, the well-defined variables profit Q and distributed profit Yd that are missing in the MMT equation.

The problem with MMTers is that they do not even understand what their own balances equation actually says. It actually says that macroeconomic profit is zero.#6 Note that a zero-profit economy is a NONENTITY like the Easter Bunny or Spiderman or the Tooth Fairy, or an intelligent MMTer.


#1 How counterfeiters save America with an extra profit and make WeThePeople pay for it, post of Feb 27
#2 From false micro to true macro: the new economic paradigm
#3 A crash course in macro accounting
#4 Wikipedia and the promotion of economists’ idiotism (II)
#5 The final implosion of MMT
#6 Dear idiots, time to get saving and investment straight (II)

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REPLY to Bob Roddis, Andrew Anderson, Konrad, Noah Way

Your talk about greed and violence is folk psychology/sociology, or PsySoc for short. It may surprise you to learn that economics is NOT AT ALL about Human Nature/motives/ behavior/action.#1, #2

Economics is about how the economic system works. More precisely, economics deals with the objective systemic laws that govern the behavior of the monetary economy.

Economists, in an analogy, are like scientists/engineers who figure out the laws of aerodynamics, thermodynamics, etc., and manage in the end to get something heavier than air off the ground and safely to some distant destination. Except that economists have NOT figured out anything about how the economy works. Instead, they have had for 200+ years now a brain-dead palaver about utility maximization, rational expectations, animal spirits, supply-demand-equilibrium, greed, and other PsySoc BS.

To this day, neither MMTers nor Austrians nor Walrasians nor Keynesians nor Marxians get the interaction of the macroeconomic balances right.#3 So, economics is at a level analogous to physics before Archimedes had figured out the Law of the Lever about 2300 years ago.

Society is cursed with the fact that economic policy has, to this day, NO sound scientific foundations. What society got instead is incessant PsySoc blather at the intellectual zero lower bound.


#1 Economics is NOT about Human Nature but the economic system
#2 PsySoc — the scourge of economics
#3 MMT-Refutation for Dummies

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AXEC144b

Economics is NOT a science of behavior (III)

Comment on Hoff/Stiglitz on ‘Striving for Balance in Economics: Towards a Theory of the Social Determination of Behavior’

Blog-Reference

Karla Hoff and Joe Stiglitz have not yet realized that economics is not a science of behavior (Hudík, 2011). What they are talking about belongs entirely to the realm of sociology, psychology, anthropology, political science, history, etcetera, and what they are advertising is a new version of psycho-sociological dilettantism.

This is remarkable because after more than 200 years of PsySoc economists still have no idea of how the market economy works. It is common knowledge that all profit theories are defective. As the Palgrave Dictionary sums up “A satisfactory theory of profits is still elusive.” (Desai, 2008, p. 10)

This means, to this day neither the Walrasian, nor the Keynesian, nor the Marxian, nor the Austrian sect can tell the difference between income and profit. Hence, they fail to capture the essence of the market economy. This is not exactly a noteworthy scientific achievement of the economics profession.

Does the world expect economists to find out how people behave? No, this is the proper job of psychology, sociology, anthropology, etcetera. Does the world expect economists to figure out what profit is? Yes, of course, no philosopher, psychologist, biologist, or sociologist will ever try to figure this out.

Have economists done their proper job? No. Do Hoff/Stiglitz know what profit is? No. Does a ‘Theory of the Social Determinants of Behavior’ help to find out what profit is? No.

It is not the task of economists to dabble in the so-called social sciences. The subject matter of economics is the economy. Economics is a systems science and Hoff/Stiglitz have not realized that they are still caught in the wrong paradigm.

Egmont Kakarot-Handtke


References
Desai, M. (2008). Profit and Profit Theory. In S. N. Durlauf, and L. E. Blume (Eds.), The New Palgrave Dictionary of Economics Online, 1–11. Palgrave Macmillan, 2nd edition. URL
Hudík, M. (2011). Why Economics is Not a Science of Behaviour. Journal of Economic Methodology, 18(2): 147–162.

Immediately following Still on the wrong track

Related 'The existence of economic laws and the nonexistence of behavioral laws' and 'The happy end of the social science delusion' and 'From PsySoc to SysHum' and 'The Science-of-Man fallacy' and 'PsySoc — the scourge of economics' and 'Methodological retards'.

For details of the big picture see cross-references Not a Science of Behavior.

From PsySoc to SysHum

Comment on Lars Syll on ‘Rational expectations — totally incredible bogus’

Blog-Reference

The student of economics either understands at their very first encounter with Econ 101
• that behavioral assumptions like utility, optimization, rational expectation, supply/ demand functions, and equilibrium are NONENTITIES;
• that in mathematics there exists a ‘whole crop of monster-structures, entirely without application’ (Bourbaki, 2005, p. 1275, fn. 9);
or unfortunately, not.

The student with a modicum of scientific guts becomes by logical necessity a heterodox economist. He will avoid NONENTITIES and inapplicable monster structures and debunk them wherever they appear.

This is right and good, but it is not good enough.

What everybody wants and needs is the correct theory and congenial math. What nobody needs is another surrealistic discussion about rational expectations, ergodicity, the fixpoint theorem, or multiple equilibria.

The reason why Heterodoxy has only been marginally successful is that it shares the foundational blunder with Orthodoxy.

The crucial point is that economics deals — in the first place — not with individual human behavior or society at large. This is the realm of psychology, sociology, anthropology, history, political science, etcetera. Insofar as economics deals with behavioral assumptions like utility maximization, greed, power-grabbing, etcetera, it is a dilettantish variant of Psycho-Sociology or PsySoc.

What is the real subject matter of economics?

As a first approximation, one can agree on the general characteristic that the economy is a complex system.

However, with the term system, one usually associates a structure with components that are non-human. In order to stress the obvious fact that humans are an essential component of the economic system, the market economy should be characterized more precisely as a complex hybrid system/human entity or SysHum (Luhmann, 1995).

The scientific method is straightforwardly applicable to the sys component but not to the hum component. While it is clear that the economy always has to be treated as an indivisible whole, for good methodological reasons, the analysis has to start with the objective system component.

In Gestalt psychological terms, the economic system is the foreground, and individual behavior is in the background. Common sense wrongly insists that the hum component must always be in the foreground. This fallacy is similar to geocentrism. The economic system has its own logic, which is different from the behavioral logic of humans. Systemic logic is what Adam Smith called the Invisible Hand.

Heterodoxy will be inextricably tied to failed Orthodoxy as long as it is content with making homo oeconomicus ‘more realistic.’ The student with a modicum of scientific guts goes beyond flat behavioral common sense, quits PsySoc altogether, and turns to SysHum. #1

Egmont Kakarot-Handtke


References
Bourbaki, N. (2005). The Architecture of Mathematics. In W. Ewald (Ed.), From Kant to Hilbert. A Source Book in the Foundations of Mathematics, Vol. II, 1265–1276. Oxford, New York,  Oxford University Press.

Luhmann, N. (1995). Social Systems, Stanford, Stanford University Press. (For Luhmann's methodological development to AI, see link Apr 20, 2026)

#1 For details of the big picture, see cross-references Paradigm Shift and cross-references New Curriculum

Related 'The Science-of-Man fallacy' and 'The Ur-Blunder of economics and its rectification'

Habermas, Albert, Robinson, Syll are right — now scrap the crap

Comment on Lars Syll on ‘Some unfounded expectations of economic theory’

Blog-Reference

Standard economics is a failed approach, and the root cause can be located with unsurpassable precision here: “As with any Lakatosian research program, the neo-Walrasian program is characterized by its hard core, heuristics, and protective belts. Without asserting that the following characterization is definitive, I have argued that the program is organized around the following propositions: 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.
By definition, the hard-core propositions are taken to be true and irrefutable by those who adhere to the program. ‘Taken to be true’ means that the hard-core functions like axioms for a geometry, maintained for the duration of the study of that geometry.” (Weintraub, 1985, p. 147)

Essentially the same assertion in Krugman’s scant blog post: “So, what is neoclassical economics? … I think we mean in practice economics based on maximization-with-equilibrium.” #1

Both constrained optimization and equilibrium are NONENTITIES like Superman and the Easter Bunny. And this is the reason why standard economics is proto-scientific garbage to this day. Because economic theory cannot be based on NONENTITIES, the propositions HC1 to HC5 have to be thrown out of economics and replaced by something better. In Joan Robinson’s words: "Scrap the lot and start again".

Habermas, Albert, Robinson, and Syll have to be criticized for elaborating endlessly on model Platonism and not taking the all-decisive step, that is, to do the Paradigm Shift and to put economics on new axiomatic foundations. #2

There are huge rewards: the world will assuredly become a better place when Krugman retires with his sorta-kinda maximization-with-equilibrium moronomics.

Egmont Kakarot-Handtke


References
Weintraub, E. R. (1985). Joan Robinson’s Critique of Equilibrium: An Appraisal.
American Economic Review, Papers and Proceedings, 75(2): 146–149. URL

#1 See here
#2 For details of the big picture, see cross-references Failed/Fake Scientists and cross-references Not a Science of Behavior and cross-references Paradigm Shift and cross-referencesAxiomatization.

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ICYMI  Paradigm lost: from incompetent economics to psycho-sociological (PsySoc) agenda pushing.
Comment on 'Paul Krugman: Despair, American Style'

Related 'PsySoc — the scourge of economics' and 'From PsySoc to SysHum' and 'The Science-of-Man fallacy'

Immediately following There is no like/dislike button in science.

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Graphic AXEC121g

MMTers: too much thought-reading, too little thinking

Comment on Bill Mitchell/Tom Hickey on ‘ECB denial is just embarrassing’

Blog-Reference and Blog-Reference

Tom Hickey recounts the highlights of his spiritual development: “There as been a running debate for some time here in the comments over whether the drivel about about MMT that appears in the corporate media from so-called experts in economics and finance is owing to ignorance or a desire to malign and marginalize MMT, or perhaps a combination thereof. I have taken the position that experts are expected to know better, so the presumption is bad faith and malicious intent. However, I have had to change my mind on this. Now it seems to me that what I have been reading is a matter of ignorance and that the supposedly top people in economics and finance, who should know the realities of what they dealing with, e.g., the relevant institutional arrangements and accounting, don’t. They are almost uniformly clueless. Worse, many don’t want to know, since their minds are already made up.”

This follows immediately Bill Mitchell’s lengthy psychological study about groupthink among mainstream economists.#1 And somebody recently asked Why does everyone hate MMT?#2 Not surprisingly, as shrewd psychologists, MMTers put forward a plausible explanation: MMT is rejected because of “ignorance or a desire to malign and marginalize MMT, ….” This exemplary psycho-social diarrhea is the main constituent of economic debates since time immemorial.#3

True, there is a lot of BS in the media about MMT but this does NOT justify answering it with counter-BS. What one has to realize is that the whole Mainstream vs MMT blather is way beside the point. As Schumpeter admonished his mentally retarded co-economists long ago: “Remember: occasionally, it may be an interesting question to ask why a man says what he says; but whatever the answer, it does not tell us anything about whether what he says is true or false.”

The point is NOT whether MMT is loved or hated but whether it is true or false. This whole psychological/motivational mind-reading exercise is nothing but a distraction from the scandal that both Mainstream and MMT are proto-scientific garbage.

The fact is that MMT has been refuted on all counts.#4, #5, #6, #7, #8 More specifically, it is a mathematical fact that the MMT sectoral balances equation is false.#9 Because the foundations are false the whole analytical superstructure and the economic policy guidance are false.

It is a curious fact that MMTers do not answer to the proof of material/formal inconsistency. Instead, they do what they accuse the Mainstream of denial, PsySoc filibuster, blocking, and censoring. Applying Tom Hickey’s mind-reading to MMT itself: “Most of the these people are heavily invested reputationally in a wrong paradigm and admitting this would be disastrous for them. So at least some self-protection is also likely involved.”

In combination with the proven material/formal inconsistency of the MMT approach, this leaves but one psycho-social conclusion: MMTers are stupid or corrupt or both.

Egmont Kakarot-Handtke


#1 Fake surveys and Groupthink in the economics profession
#2 Love and hate in economics: the PsySoc shell game
#3 The economist as second-guesser, mind reader, and folk psychologist
#4 The final implosion of MMT
#5 Refuting MMT’s Macroeconomics Textbook
#6 MMT: fundamentally false
#7 The canonical macroeconomic model
#8 For the full-spectrum refutation of MMT see cross-references MMT
#9 The MMT equation (I−S)+(G−T)+(X−M)=0 is false, the AXEC equation (I−S)+(G−T)+(X−M)−(Q−Yd)=0 is true. The equations are testable with the precision of two decimal places.

Related 'Economics: the honeypot for know-nothingers' and 'Ditch scientific incompetence!' and 'Economics is NOT a social science' and 'Social science is NOT a science but a sitcom' and 'Economics is NOT about Human Nature but the economic system' and 'Overreach: Economists have their fingers in every pie except real economics' and 'How to get rid of the silly Queen' and 'New economic thinking = old political fake' and 'PsySoc — the scourge of economics' and 'Disoriented and lost in folk psychology' and 'How economists became the scientific laughing stock' and 'Opinion, conversation, interpretation, blather: the economist’s major immunizing stratagems' and 'The economics Cargo Cult Prize' and 'Failed economics: The losers’ long list of lame excuses' and 'Meet the MMT smart arses' and 'Economists/MMTers: agenda pushers, distractors, blockers, muters, censors'.

How to get out of the Econ 101 PsySoc woods

Comment on Asad Zaman ‘The misconceived project of social science’

Blog-Reference

The student of economics either understands at his first encounter with Econ 101 that subjective-behavioral concepts like utility, constrained optimization, rational expectation, supply/demand functions, and equilibrium are NONENTITIES or he is lost in the woods. The student with a modicum of scientific guts becomes by logical necessity a heterodox economist, and he will avoid NONENTITIES like the plague.

What everybody wants and needs are the correct theory and the congenial formalization. What nobody needs is another surrealistic discussion about rational expectations, ergodicity, the fixpoint theorem, multiple equilibria, or mathiness.

The reason why Heterodoxy has hitherto only been marginally successful is that it shares the foundational blunder with Orthodoxy.

The crucial point is that economics deals — in the first place — NOT with individual human behavior or society at large. This is the realm of Psychology, Sociology, Anthropology, History, Political Sciences, etcetera. Insofar as economics deals with behavioral assumptions like utility maximization, greed, power-grabbing, etcetera, it is a dilettantish variant of Psycho-Sociology or PsySoc.

What is the real subject matter of economics?

As a first approximation, one can agree on the general characteristic that the economy is a complex system.

However, with the term system, one usually associates a structure with components that are non-human. In order to stress the obvious fact that humans are an essential component of the economic system, the market economy should be characterized more precisely as a complex hybrid system/human entity or SysHum.

The scientific method is straightforwardly applicable to the sys-component but not to the hum-component. While it is clear that the economy always has to be treated as an indivisible whole, for good methodological reasons the analysis has to start with the objective system component.

In other words, the economic system is the foreground, and individual behavior is in the background. Common sense wrongly insists that the hum component must always be in the foreground. This fallacy compares to geocentrism. The economic system has its own logic which is different from the behavioral logic of humans. Systemic logic is what Adam Smith called the Invisible Hand.

Heterodoxy will be inextricably tied to failed Orthodoxy as long as it is content with a more ‘realistic’ homo oeconomicus and storytelling. The student with a modicum of scientific guts goes beyond flat behavioral common sense, quits PsySoc altogether, and turns to SysHum.#1

Economics is NOT a social science, economics is a systems science.

Egmont Kakarot-Handtke


#1 For details of the big picture see cross-references Paradigm Shift and cross-references New Curriculum.

Related 'Economics is NOT about Human Nature but the economic system' and 'How to overcome the manifest silliness of Econ 101 and save the economy' and 'Feeble minds, shaky assumptions, and the inevitable failure of economics' and 'The economist as second-guesser, mind reader, and folk psychologist' and 'Economics is NOT a science of behavior' and cross-references Not a Science of Behavior.

Not a Science of Behavior: cross-references

Posts

• Psychologism: how morons explain the world   here
• Paul’s and Stephanie’s economic delirium talk   here
• If religion is opium of the people, economics is crack of the people   here
• Ontological uncertainty is NOT the problem but economists’ ontological stupidity   here
• Causality in economics   here
• Links on Lars P. Syll’s ‘Wren-Lewis insults medical science’   here
• From false microfoundations to true macrofoundations (I)   here
• Economists: only good at excuses   here
• The five pathetic blunders of Roger Farmer   here
• If we only had classes   here
• MMT = Modern Monetary Trash   here
• The Theory of Value and the worthlessness of economics   here
• Overreach: Economists have their fingers in every pie except real economics   here
• Economics is NOT about what Happiness is but about what Profit is   here
• The curious non-existence of profit in economics   here
• Behavioral economics ― forever stuck at the proto-scientific level   here
• Lars Syll, fake scientist   here
• How the representative economist gets it wrong big-time   here
• Joan Robinson and the early death of Behavioral Economics   here
• Why does Heterodoxy not abolish the fake Nobel?   here
• The economics Cargo Cult Prize   here
• Social science is NOT a science but a sitcom   here
• New Economic Thinking = old scientific garbage   here
• Karl Marx, fake scientist   here
• Sending Solow’s growth model to the dump of proto-scientific history   here
• The five pathetic blunders of Roger Farmer   here
• How economists habitually mess it up   here
• Economics is not a science, not a religion, but proto-scientific garbage   here
• Just another cargo cultic exercise   here
• Hijackers, agenda pushers, PsySocs and other morons   here
• First Lecture in New Economic Thinking   here
• Economics is NOT about Human Nature but the economic system   here
• Redefining economics   here
• The thinking economist   here
• Note on Chris Dillow on Salient Identities   here
• The methodological blunders of fake scientists   here
• Strange noise in the graveyard of economics   here
• Complexity and stupidity   here
• How to finally hammer down the nails in the coffin of Monty Python economics   here
• Rethinking MMT   here
• A new curriculum for swampies?   here
• How to end the futile economics zombie ping-pong   here
• Does economics matter?   here
• False and true economic laws   here
• Economics is NOT a social science   here
• Feeble minds, shaky assumptions, and the inevitable failure of economics   here
• The economist as second-guesser, mind reader, and folk psychologist   here
• Iatrogenic economics   here
• What’s wrong with Econ 101? Economists, of course!   here
• The scientific self-elimination of Heterodoxy   here
• When substandard thinkers dabble in science it is called economics   here
• How to get out of the Econ 101 PsySoc woods   here
• Economics is NOT a science of behavior (IV)   here
• Economists and methodology: the horror of all horrors   here
• Agenda pushing or science?   here
• Are economists natural-born scientific failures?   here
• Axiomatized nonentities and the failure of methodologists   here
• Economics as fool’s paradise   here
• Still on the wrong track   here
• The existence of economic laws and the nonexistence of behavioral laws   here
• Economics is NOT a science of behavior (III)   here
• Towards the true economic theory   here
• Scientific Cavemen with a daunting message   here
• The Ur-Blunder of economics and its rectification   here
• Heterodoxy as superior alternative   here
• Prediction does not work? Try retrodiction first   here
• Habermas, Albert, Robinson, Syll are right — now scrap the crap   here
• Are economists methodological retards?   here
• Not yet in and not yet out of the wood   here
• Misled by ordinary intuition and common sense   here
• The Science-of-Man fallacy   here
• Redefining economics   here
• Coming to terms with formalization (II)   here
• PsySoc — the scourge of economics   here
• Economics: ‘a tale told by an idiot, full of sound and fury’?   here
• How to start off at the right foot   here
• Confounding sociology and economics   here
• The very real problem of the representative economist   here
• The happy end of the social science delusion   here
• No culpa, only stultitia   here
• Disoriented and lost in folk psychology   here
• The philosophy of know-nothingers   here
• No foundations   here
• Economics: the honeypot for know-nothingers   here
• Stubbornly in the wrong research program   here
• We simply do not know — so let us move on   here
• Cartoon science   here
• The case for pure economics   here
• An exercise in futility   here
• The art of start   here
• A farewell to PsySoc economics   here
• Economics is not a science of behavior (II)   here
• The guessing game   here
• Poor philosophy, poor science, poor job   here
• The intelligent layperson's guide through vacuonomics   here
• What economics is not about   here
• Economics is not what most economists think it is   here
• Neither truth nor beauty   here
• Economics vs. Sociology   here
• Complexity, scientific incompetence, and the art of asking the right questions   here
• Questions and answers about economics   here
• United in the social science delusion   here
• Of birds and worms   here
• Lacking the Midas touch of science   here
• Deconfusing confused confusers   here
• From behavior to structure   here
• Throwing soap bubbles at time wasters   here
• Uncertain about everything   here
• Replacing the neoclassical axioms   here
• Still in the woods   here
• Time to get out of gossip economics   here
• Economics is NOT a science of behavior (I)   here

Meta references

How Adam Smith messed up economics

Comment on Ken Zimmerman on 'Adam Smith’s idea is still the basis of the discipline of economics'

Blog-Reference

The history of economic thought is the history of scientific failure. The major approaches ― Walrasianism, Keynesianism, Marxianism, Austrianism, MMT ― are mutually contradictory, axiomatically false, and materially/formally inconsistent. Because of this, the whole analytical superstructure of economics is scientifically worthless. Because of this, economic policy guidance has NEVER had sound scientific foundations.

Now, the problem is this: “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 do not have the true theory, economics boils down to brain-dead agenda-pushing. Economists are not scientists but clowns, useful idiots, and agenda pushers in the political Circus Maximus. Economics is proto-scientific garbage, and because of their scientific incompetence, economists are a hazard to their fellow citizens. #1

The mental misery can be traced back to Adam Smith: “Smith … disliked whatever went beyond plain common sense. He never moved above the heads of even the dullest readers. He led them on gently, encouraging them by trivialities and homely observations, making them feel comfortable all along.” (Schumpeter)

Or, as Ken Zimmerman spins it: “The real start of modern Western economics as a discipline is usually traced to Adam Smith (1723–1790). Beginning as a moral philosopher concerned with human motives, Smith later wrote The Wealth of Nations in 1776 as a series of lectures on public policy. The task he set for himself was that of a natural scientist, to discover the workings of a vast machine ― the economy. From this philosophical foundation, Smith builds a powerful argument that the individual’s self-interest generates the society’s best interests. Beginning with a rational individual motivated by positive natural impulses, he undertakes a series of dramatic political attacks on monopolists, corrupt governments, tariffs promoted by strong business lobbyists, guilds, colonialists, and ‘the capricious ambitions of kings and ministers’ (1937, 460). Though based on self-interest, a well-working economy, he said, should not cater to the selfish interests of a small class or group. Instead, it furthers the wealth of the nation as a whole ― and it is not a great step from here to the idea of democracy, of rule ‘of, by, and for’ the people of the nation.”

“Beginning with a rational individual”, Adam Smith inaugurated methodological individualism and led the profession straight into the Fallacy of Composition. The fact of the matter is, that NO way leads from the second-guessing of Human Nature/motives/behavior/action to the understanding of how the economic system works.

What Adam Smith did was a mixture of psychology and sociology ― PsySoc for short #2 ― including moralizing and agenda-pushing but NOT economics proper. Economics is about the behavior of the economic system and NOT the behavior of people. Adam Smith never understood the behavior of the system as a whole, i.e., “the workings of a vast machine”, and he never understood macroeconomic profit. #3 The supply-demand-equilibrium narrative that culminated in General Equilibrium Theory is a bad joke to this day. An economist who does not understand profit, i.e., the foundational concept of economics, is a laughing stock.

However, the economy is an abstract entity that defies intuitive understanding, and human behavior is something every moron claims to understand from his own personal experience. As a consequence, Adam Smith's blather about the baker and the butcher and their rational self-interest won the popular vote. The beauty of PsySoc is that one can speculate and talk and moralize about human nature/behavior without ever arriving at scientific knowledge about how the economic system works. People do not like science; they like storytelling and talk shows.

In his scientific incompetence, Adam Smith took the wrong path. He led economics away from science and helped it finally become a subcontractor of the disinfotainment industry. #4

To this day, economics has no scientific truth-value #5 but only political use-value. Politically, Smith's invisible-hand economics forwarded the illusion of Democracy and the reality of Oligarchy. And this is why “Adam Smith's idea is still the basis of the discipline of economics”.

Egmont Kakarot-Handtke

#1 Econogenics: economists pose a hazard to their fellow citizens

#2 PsySoc — the scourge of economics

#3 The profit theory is false since Adam Smith

#4 Circus Maximus: Economics as entertainment, personality gossip, virtue signaling, and lifestyle promotion

#5 Wikipedia, economics, scientific knowledge, or political agenda pushing?

***

REPLY to mameerop, Dec 13 [not published because of comments closed]

Economics has a long tradition of the pointless exercise called exegesis: “Exegesis is a critical explanation or interpretation of a text. Traditionally, the term was used primarily for work with religious texts, especially the Bible. In modern usage, exegesis can involve critical interpretations of virtually any text, …” #1, #2

At some point in any economic discussion, the issue is no longer how the economy works but about what XYZ has said about how the economy works. In other words, folks get lost in metacommunication.

This is NOT an accident but a built-in feature of political economics.

“Another danger is that you may ‘precise everything away’ and be left with only a comparative poverty of meaning. ... Such a problem was avoided, said Keynes, by Marshall who used loose definitions but allowed the reader to infer his meaning from ‘the richness of context’.” (Coates, 2007, p. 87)

In other words, the reader is encouraged to substitute almost any meaning he likes. The result is well-known. Keynes' loose verbal reasoning triggered an enthusiastic exegesis movement that circled for some decades around the question ‘What Keynes really meant?’ Predictably, the question has never been answered. The richness of meaning only generated a wealth of blah blah.

The same holds, of course, for Adam Smith's Invisible Hand.

Take notice that every text that contains this metaphor has NO scientific content but is pure disinformation and that every author who applies this metaphor is NOT a scientist but a mentally retarded political agenda-pusher.

Adam Smith has to be buried at the Flat-Earth Cemetery together with all folks who ever tried to ‘explain’ what Smith ‘really’ meant.

Economics is a failed/fake science and needs a Paradigm Shift. This means that Adam Smith's idea is NO LONGER the “basis of the discipline of economics”.

#1 Wikipedia

#2 For more about exegesis, see AXECquery

***

Graphic AXEC121i

The happy end of the social science delusion

Comment on Lars Syll on ‘Are all models wrong?’

Blog-Reference

For more than two thousand years now, physicists have seen falling leaves but until this day we have no scientific theory of this phenomenon. Instead, we have the theory of gravity, motion, ballistics, etc.

The first thing to notice is that physicists are not concerned with reality as such but with certain aspects of reality. In other words, reality is narrowed down to those general aspects that can be dealt with effectively by applying tools that are already available or are developed specifically for the task at hand.

What a scientist instinctively avoids are questions that cannot be answered in principle like: Is God male or female? Exactly this type of question is what occupies non-scientists most of their time.

Science is often accused of being narrow or over-simplistic. However, those who have tried to tackle the fullness of reality head-on have never produced more than colorful descriptions, interesting gossip, subjective interpretations, data-decorated hunches, or extensively interpolated individual histories. In the meantime, narrowly focused science has moved in an unbroken sequence of logical steps from the elementary Law of the Lever to the unobservable deep reality of quantum particles and quarks.

Reality is not something given and simply to be looked upon — this is the delusion of naive empiricism — but is continuously redefined in the course of scientific research itself.

While it is obvious that economics has much to do with human behavior it is a methodological mistake to primarily focus on this aspect of economic reality, just as it a mistake to focus on individual flying leaves in order to find out something general about falling bodies. No way leads from the observation of a myriad of falling leaves to the Universal Law of Falling Bodies. Likewise, no way leads from the observation of individual behavior to the systemic economic laws.

The so-called social sciences have always been a misguided endeavor. The reason is simple. “By having a vague theory it is possible to get either result. ... It is usually said when this is pointed out, ‘When you are dealing with psychological matters things can't be defined so precisely’. Yes, but then you cannot claim to know anything about it.” (Feynman, 1992, p. 159)

Certain knowledge about human behavior is hard to come by, to say the least, and to circumvent this fundamental difficulty by postulating constrained optimization is of breathtaking naivety — or worse.

It has not been such a good idea to build economics on a green cheese assumption about human behavior. Therefore, “... if we wish to place economic science upon a solid basis, we must make it completely independent of psychological assumptions and philosophical hypotheses.” (Slutzky, quoted in Mirowski, 1995, p. 362) see also (Hudík, 2011)

This is exactly the opposite of what may be called Hume’s methodological delusion: “And as the science of man is the only solid foundation for the other sciences, so the only solid foundation we can give to this science itself must be laid on experience and observation.” (Hume, 2012, Introduction)

The results of Hume’s program are, as to be expected: “...there has been no progress in developing laws of human behavior for the last twenty-five hundred years.” (Hausman, 1992, p. 320)

The science of man, or what we call social sciences, has no solid foundation. As a matter of principle, there is no such thing as a social science. Therefore, the first methodological task is to take economics out of what Feynman aptly called cargo cult science.

The new definition of economics is objective-structural-systemic and entirely free of any behavioral connotations: economics is the science that studies how the monetary economy works. Thus, the popular yet forever pointless second-guessing of human motives and behavior can be left to psychology, sociology, political sciences, philosophy, mythology, literature or science fiction.

Economics is a failed science and the ultimate cause is given with this definition: “It is a touchstone of accepted economics that all explanations must run in terms of the actions and reactions of individuals.“ (Arrow, 1994, p. 1)

Accepted economics is scientifically unacceptable.

Egmont Kakarot-Handtke


References
Arrow, K. J. (1994). Methodological Individualism and Social Knowledge. American Economic Review, Papers and Proceedings, 84(2): 1–9. URL
Feynman, R. P. (1992). The Character of Physical Law. London: Penguin.
Hausman, D. M. (1992). The Inexact and Separate Science of Economics. Cambridge: Cambridge University Press.
Hudík, M. (2011). Why Economics is Not a Science of Behaviour. Journal of Economic Methodology, 18(2): 147–162.
Hume, D. (2012). A Treatise of Human Nature. Project Gutenberg EBook. URL
Mirowski, P. (1995). More Heat than Light. Cambridge: Cambridge University Press.

Related 'From PsySoc to SysHum' and 'The Science-of-Man fallacy' and 'PsySoc — the scourge of economics' and 'The art of start' and 'A farewell to PsySoc economics' and 'Redefining economics' and 'Economics vs. Sociology' and 'Questions and answers about economics'.

***

ICYMI (Henry, September 13)

True to form, economists got also the criterion of simplicity into the wrong throat: “Others, the inexperienced students, make guesses that are very complicated, and it sort of looks as if it is all right, but I know it is not true because the truth always turns out to be simpler than you thought.” (Feynman, 1922)

Economists explain their failure regularly with the complexity of the subject matter. This argument does not hold water.

“But in fact, there are good reasons, not only for the belief that social science is less complicated than physics, but also for the belief that concrete social situations are in general less complicated than concrete physical situations.” (Popper, 1960)

‘All models are false’ is a correct observation as far as standard economics is concerned, but the usual explanation is misleading.

“I think we have to admit that most successful scientific theories are lucky over-simplifications. (Popper, 1994)

The keyword is lucky.


Related 'Two steps towards truth'.