Occasional Xs: The history of economic thought is the history of scientific failure (XXX)

 

#Economics#FailedFakeScience

The history of economic thought is the history of scientific failure. The major approaches (#Walrasianism, #Keynesianism, #Marxianism, #Austrianism, and their derivatives) are mutually contradictory & axiomatically false & materially/formally…

— E.K-H (@AXECorg) October 17, 2024

Occasional Tweets: The history of economics and economic history ― the mutual reinforcement of scientific failure

 

The history of economic thought is the history of scientific failure. #Walrasianism, #Keynesianism, #Marxianism, #Austrianism, #MMT, are mutually contradictory, axiomatically false, and materially/formally inconsistent. Economists lack the tool for understanding economic history.

— E.K-H (@AXECorg) September 17, 2021

For more about history see AXECquery. 

 

Occasional Tweets: The futile attempt to recycle Austrianism (X)

 

#Economics cannot be based on a behavioral #Axiom. #Praxeology is methodologically unacceptable. Because the axiomatic foundations of #Austrianism are false the whole analytical superstructure is scientifically worthless.

Austrianism ― axiomatically falsehttps://t.co/luMh1CLitk pic.twitter.com/Fz4yzf4lRZ

— E.K-H (@AXECorg) November 2, 2022

Occasional Tweets: No false-hero memorials (XVIII)

 

“Economics is the study of the economy, not the study of economists.” (R. Reis)

The history of economic thought is the history of scientific failure. The major approaches are axiomatically false & materially/formally inconsistent & ALL got #Profit wrong. Jevons was NO exception.

— E.K-H (@AXECorg) October 21, 2023

For more about Jevons see AXECquery. 

Occasionale Tweets: A tale told by an idiot ― the history of economics thought

 

The history of economic thought is the history of scientific failure. #Walrasianism, #Keynesianism, #Marxianism, #Austrianism, #MMT are axiomatically false and materially/formally inconsistent. ALL got the concept of #Profit wrong. #Economics is scientifically worthless. pic.twitter.com/yE7si2JxRd

— E.K-H (@AXECorg) April 24, 2022

Occasional Tweets: Close cousins ― economics and literary forgery

 

#Economics#FakeScience

Economic history and the history of economic thought are tightly interconnected literary forgeries. Their scientific content is zero bc of the lack of true (materially/formally consistent) theory.
The economist as storyteller (II)https://t.co/1XnmKQexei

— E.K-H (@AXECorg) September 7, 2022

Occasional Tweets: The history of economic thought is like the history of the Easter Bunny ― scientifically vacuous

 

#Economics#FailedScience#FakeScience

The history of economic thought is the history of scientific failure.

Economics is NOT a social sciencehttps://t.co/zJHeQboYGH

and NOT a science of behaviorhttps://t.co/MzGiF9gpXa

and #Economists are unfit for elementary logic/math. pic.twitter.com/UNmTwGK7K2

— E.K-H (@AXECorg) October 23, 2021

***

"Rubbish is rubbish, but the history of rubbish is scholarship." (Haack)

For more about history see AXECquery. 

Occasional Xs: The history of economic thought is the history of scientific failure (XXXVII)

 

#Economics#AllYouNeedToKnow

For 200+ years, economics has claimed to be Science but still is NOT. The major approaches (Walrasianism, Keynesianism, Marxianism, Austrianism, and their derivatives) are mutually contradictory & axiomatically false & materially/formally… pic.twitter.com/YMYxrHFjU0

— AXEC (@EgmontHandtke) April 15, 2025

Occasional Xs: The history of economic thought is the history of scientific failure (XXVIII)

 

#Economics#FailefFakeScience

The history of economic thought is the history of scientific failure. The major approaches (#Walrasianism, #Keynesianism, #Marxianism, #Austrianism, and their derivatives) are mutually contradictory & axiomatically false & materially/formally… pic.twitter.com/JlktdPGFIq

— E.K-H (@AXECorg) September 16, 2024

Occasional Tweets: Economic history and the history of economic thought are tightly interconnected literary forgeries

 

#Econ#FailedScience#FakeScience

The history of economic thought is the history of scientific failure. Brad DeLong is a case in point.

The retirement of a fake scientist and real agenda pusherhttps://t.co/upRU696weD

The economist as storyteller (II)https://t.co/1XnmKQexei pic.twitter.com/JC4lzMoUOD

— E.K-H (@AXECorg) September 7, 2022

United in confusion

Comment on Syll/Glasner on ‘Lucas’ caricature of economic science’

Blog-Reference and Blog-Reference

You write: “Economics confuses mathematization and internal consistency with science. It is amateurism at its worse. And it has gone on for too long.”

That is not quite correct. Science is defined by its methodology: “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, p. 31)

So, one needs always both. Orthodoxy cannot be criticized for insisting on formal consistency but for lacking material consistency.

What you are proposing as a remedy — historicism, sociologism, psychologism — is not the way forward. We know from the examples of Veblen or the German Historical School that this program, too, has produced much storytelling but nothing of real scientific value.

The failure of Orthodoxy is due to the following set of foundational 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.” (Weintraub, 1985, p. 147)

HC1 is vacuous and HC2 to HC5 lacks material consistency. This is sufficient for the refutation of Orthodoxy.

The whole discussion about formalization and mathiness is beside the point. Science is defined by formal and material consistency. Economics lacks both. Ergo, economics is not a science. There is no difference between Orthodoxy and Heterodoxy in this respect. The representative economist is a confused confuser (2013), that is all.

Egmont Kakarot-Handtke


References
Kakarot-Handtke, E. (2013). Confused Confusers: How to Stop Thinking Like an Economist and Start Thinking Like a Scientist. SSRN Working Paper Series, 2207598: 1–16. URL
Klant, J. J. (1994). The Nature of Economic Thought. Aldershot, Brookfield: Edward Elgar.
Weintraub, E. R. (1985). Joan Robinson’s Critique of Equilibrium: An Appraisal. American Economic Review, Papers and Proceedings, 75(2): 146–149. URL

Preceding No foundations

***

Wikimedia AXEC169

History and the identity problem of economics

Comment on Peter Radford on ‘History and Economics’

Blog-Reference

Peter Radford summarizes “Sorting all that out is what historians do well. Rediscovering the past is hard work. It is a lot more difficult than developing rational choice theory for instance. The one has to deal with ambiguities or uncertainties and tease them apart. The other simply assume them away.
Richer economics has room for both. It is after all about the behavior of human beings.”

Economics is not at all about the behavior of human beings. Psychology and Sociology are about the behavior of human beings.#1 Economics is about the behavior of the economy.

Economics is not a social science like sociology and not a natural science like physics but a systems science.

Neither orthodox nor heterodox economists got this point. Rational choice theory, for example, is not economics at all, it is a scary example of amateur psychology.

The blatant methodological blunder of Orthodoxy consists of taking the green cheese behavioral assumption of constrained optimization into the set of foundational propositions, aka axioms. Because of this, the whole neoclassical axiom set is untenable and this explodes the whole theoretical superstructure.#2

Because economics is not a social science no behavioral assumption must appear in the foundational propositions of economics (Hudík, 2011). The explanation for the manifest lack of success of Heterodoxy in replacing Orthodoxy is that it suffers from the social science delusion just like Orthodoxy.

The second delusion is that history deals with plain facts while theory takes place in some Platonic parallel universe. Suffice it to remind oneself that historians could not establish beyond a reasonable doubt in more than 2300 years whether Jesus existed or not. As a matter of fact, history consists largely of pointless speculation about NONENTITIES and NONEVENTS. Not to forget that historians have devoted and still devote a considerable part of their ingenuity and energy to the production of ‘historical facts’.

If Peter Radford means with “A richer economics has room for both” that waffling about utility maximization and storytelling about the Medicis and medieval banking can coexist, then he is in full accordance with experience. If he means with richness more scientific knowledge about the actual economy, then he is certainly mistaken.

It is a historical fact, that, taken as a whole, historical reality as uncovered/produced by historians is less real than theoretical reality as uncovered/produced by scientists.

The role of history is to gather the facts and the data that are necessary for testing economic theories. To lecture about economic methodology is not the historian's job.

Egmont Kakarot-Handtke


References
Hudík, M. (2011). Why Economics is Not a Science of Behaviour. Journal of Economic Methodology, 18(2): 147–162.

#1 PsySoc— the scourge of economics and The Science-of-Man fallacy and From PsySoc to SysHum
#2 How economists became the scientific laughing stock

Occasional Tweets: The futile attempt to recycle the vacuous history of economic thought

 

The history of economic thought is the history of scientific failure. #Economics has always been proto-scientific garbage because #Economists are too stupid for the elementary #Algebra of #MacroFoundations.

The profit theory is false since Adam Smithhttps://t.co/s3zlXjwArK pic.twitter.com/0o3oxvxJEq

— E.K-H (@AXECorg) February 16, 2022

The falsification of history is, of course, not in any way limited to economics. For history in general see for example How Fake Is Roman Antiquity? 

Occasional Tweets: The history of economic thought is the history of scientific failure (III)

 

The history of economic thought is the history of scientific failure. #Walrasianism, #Keynesianism, #Marxianism, #Austrianism, #MMT are axiomatically false, materially/formally inconsistent, and ALL got #Profit wrong. #Economics needs a #ParadigmShift. pic.twitter.com/wFRaNCdzyX

— E.K-H (@AXECorg) June 2, 2022

History delivers the questions but not the answers

Comment on Robert Locke on ‘The naiveté of science as the history of Ideas’

Blog-Reference

It is rather trivial that a scientific/mathematical proposition/law/discovery/theorem emerges in a specific social, historical, geographical, or biographical context. But for the question of whether, for example, the Law of Universal Gravitation#1 is true or false these specifics are absolutely irrelevant.

What, then, is relevant?: “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)

Everything else, e.g. calendar time, religion, nationality, gender, etc., is a distraction from actual scientific problem-solving and irrelevant to the assessment of the truth/falsity of a theory. Historians are occupied with the context of discovery, and scientists are occupied with the context of justification, i.e. the logical and material consistency of a theory.

Science is about general and invariant features of reality (= invariances, see Nozick 2001 ), history/ evolution is about unique event configurations on the surface which never repeat themselves. This is known since Heraclitus and that is why Descartes said that history was not a science. Science abstracts from historical detail. No way leads from the history of falling apples to the universal Law of Falling Bodies. No way leads from the historical fact that Einstein wore no socks to the understanding of the Theory of Relativity.

Economics is about the underlying structural laws of the economic system. If you do not understand these (e.g. the macroeconomic Profit Law#2) you neither understand the present nor the past.

The current state of economics is this: economists got the premises/basic concepts/axioms of economic theory hopelessly wrong. Because of this, the whole theoretical superstructure that in turn informs economic policy is defective. What we actually have is folk psychology, folk sociology,#3 storytelling, political blather, senseless model bricolage, the history of money since the cowrie shell, and utter methodological confusion.

Egmont Kakarot-Handtke


#1 Wikipedia
#2 Wikimedia AXEC08

#3 How to get out of the Econ 101 PsySoc woods

***

REPLY to Robert Locke on Jun 4

You say: “ the pursuit of knowledge tempered by the subjectivity of the individual observer and by extension the political, economic, and social subjectivities specific to historical time and place.”

I agree. Just because of this economics has to leave all subjective/behavioral/human nature issues to psychology, sociology, history, politics, etc., and focus on the systemic aspect of the (world-) economy.

This is what the shift from subjective-behavioral microfoundations to objective-structural macrofoundations is all about. And this is the economic methodology of the 21st century.

A historical misunderstanding

Comment on Robert Locke on ‘Expanding heterodoxy in economic analysis’

Blog-Reference

The theory of fire explains fire as an interaction of certain materials and oxygen and the laws of energy transformation. And it tells us, for example, that there is no fire on the moon.

In contradistinction, the history of fire tells us which cities burned down at which point on the timeline and what the casualties were, and perhaps who set the fire. From these events we can derive some truisms about fire but no matter how many fires the historian studies he will not arrive at the theory of fire — and eventually at Thermodynamics.

Science is not concerned with individual historical events except as a singular manifestation of general law. A concrete historical event can either corroborate or refute a general law. But the historical fact that Nero burned down Rome (if it is indeed a fact and not propaganda) is irrelevant for the theory of fire.

In particular, the information in which the historian and the general public are most interested in — who burned down Rome, and why, and how was it done — are completely irrelevant for the theory of fire.

The relationship between history and economic theory is not different from the relationship between history and physics: “We are very far from being able to predict, even in physics, the precise results of a concrete situation, such as a thunderstorm, or a fire. (Popper, 1960, p. 139)

Heterodox history should therefore not be confounded with heterodox economics. Heterodox economics can tell historians for example that they have no idea of the fundamental Law of Profit as they have no idea of the Laws of energy transformation.

Economics is neither psychology, nor sociology, nor history. Economics is the science that studies how the monetary economy works.#1 Science looks for what remains unchanged in time, i.e. ‘eternal’ laws, history looks at what changes over time. “That is why Descartes said that history was not a science — because there were no general laws which could be applied to history.” (Berlin, 2002, p. 76)

Historical facts can be important for corroboration/refutation of a theory but history is not a substitute for theory. Because of this, Robert Locke and Asad Zaman are methodologically on the wrong track. For the correct synthesis of theory and history see (2014).

Egmont Kakarot-Handtke


References
Berlin, I. (2002). Freedom and Its Betrayal. London: Chatto Windus.
Kakarot-Handtke, E. (2014). The Synthesis of Economic Law, Evolution, and History. SSRN Working Paper Series, 2500696: 1–22. URL
Popper, K. R. (1960). The Poverty of Historicism. London, Henley: Routledge and Kegan Paul.

#1 The Ur-Blunder of economics and its rectification

Related 'Predictably confused' and 'The universal Profit Law and the multitude of unique historical circumstances' and 'History and methodology: no trouble of any sort' and 'Historians don't get it'

Does Asad Zaman fly with POL or SCI Airlines?

Comment on Asad Zaman on ‘Meta-theory and pluralism in the methodology of Polanyi’

Blog-Reference and Blog-Reference and Blog-Reference

All confusion about economics derives from the fact that there are TWO economixes: political economics (= POL) and theoretical economics (= SCI). 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.

In the beginning, there was Political Economy. J. S. Mill defined it clearly as a social science: “The fundamental problem, therefore, of the social science, is to find the laws according to which any state of society produces the state which succeeds it and takes its place.” Or, a bit more specific with regard to economics: “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.”

Economics started as a hodgepodge of sociology, history, folk psychology, and folk philosophy, which came under the heading of utilitarianism.

Classical Political Economy was carried one step further with methodological individualism: “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)

Methodological individualism is clearly defined by 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)

Axiomatization is not only laudable but methodologically indispensable: “We should also like to underline Debreu’s effective reference to Bacon when he says that ‘citius emergit veritas ex errore quam ex confusione.’ It would be a mistake to lower the level of analysis and clarification. The only way possible is a thorough reexamination of the theory’s basic hypotheses, i.e., a true paradigmatic revolution.” (Ingrao et al.)

Orthodox economics remains firmly rooted in the social sciences because it is defined by behavioral axioms. Yet, orthodox economics is widely considered as scientific failure. To replace Orthodoxy requires the replacement of HC1-HC5 by an entirely new set of axioms. This is what a true paradigmatic revolution is all about.

The unity about the unacceptable state of economics, though, covers the disunity about how to proceed: “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)

Asad Zaman breaks this deadlock and advocates the adoption of Polanyi’s methodology.

• While traditional methodology operates at the elementary level with the binary true/false criterion “Polanyi operates at a meta-theoretical level.”
• The subject matter is essentially the same as classical economics: “Polanyi concentrates on the process of social change.”
• This leads to history: “We are learning this [English history] to understand the process of social change, and especially how this process generates theories about social change.”
• History, though, delivers only the raw material: “Given any collection of facts, there always exist multiple narratives which join together these facts into a coherent and causally ordered sequence.” As a result, we have the pluralism of narratives.
• It would be advantageous to determine which of the narratives is true but it is pretty obvious from the outset: “For most of the ideas that we study about the world we live in, we will never be able to ascertain for sure whether they are true or false. We must live with uncertainties, and we can only judge relative plausibility and levels of compatibility with observations of different theories.”
• Therefore: “We must give up the search for the Holy Grail; the one true narrative is only available to God.”
• However, we must come to a conclusion as a precondition for acting effectively: “This means that we look at competing narratives and evaluate them. Evaluation is not only with respect to the true/false binary. Rather we look at how different narratives support or conflict with interests of different social classes.”

As a result of the procedure, the 1-percenters prefer theory/narrative A because they think it is in their interest, and the 99-percenters prefer theory/narrative B because they think it is in their interest. According to the Polanyi/Zaman rule theory/narrative B is preferable because it benefits the 99-percenters. The Paradigm Shift in economics consists therefore in changing the rule for theory/narrative selection and abolishing the binary true/false criterion with truth defined as material/formal consistency.

Now, the snag is that without the true theory it cannot be determined what the ultimate effects of a measure are and who benefits and who loses. False theory leads to false economic policy advice.#1 The defect of Polanyi’s approach is that he does not understand economic history because he lacks the true theory, that is, he does not know how the economic SYSTEM works. The systemic laws, e.g. the Profit Law, do not follow from the observation of human behavior in concrete historical situations.#2 The economic historian is blind without economic theory.

There is no way around this: economists need the one true theory and not the pluralism of narratives: “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)

Asad Zaman argues in the tradition of political economics. Political economics, though, has achieved NOTHING of scientific value in the past 200+ years. At the bottom of his heart, Asad Zaman knows this.

Let us make a thought experiment: There are two air crafts called POL and SCI waiting in the maneuvering area. POL has been designed/constructed by folks who subscribe to Polanyi’s pluralist methodology as summarized above. SCI has been designed/constructed by folks who subscribe to the tried and tested methodology of material/formal consistency as explained in the foreword of every physics textbook. Which aircraft will Asad Zaman board?

Everybody knows: the so-called social sciences in general and political economics in particular NEVER got anything off the ground. Polanyi’s proto-scientific approach is no exception.

Egmont Kakarot-Handtke

#1 Austerity and the idiocy of political economists
#2 For the axiomatically true theory see True macrofoundations: the reset of economics.


Related 'Failed critique of failed economics' and 'The stupidity of Heterodoxy is the life insurance of Orthodoxy' and 'Ditch scientific incompetence!' and 'How Heterodoxy became the venue for science’s scum' and 'The one stone that kills orthodox and heterodox employment theory' and cross-references Heterodoxy

Occasional Tweets: Alfred Marshall and the history of fake science

 

#Economics#FailedScience#FakeScience#Economists#StupidOrCorruptOrBoth

The history of economic thought is the history of scientific failure.

Marshall and the Cambridge School of plain economic gibberishhttps://t.co/7Pr9uG2TmV

Things have NOT improved to this day. pic.twitter.com/Pg5BM1JcIy

— E.K-H (@AXECorg) January 28, 2022

For more about Marshall see AXECquery. 

Occasional Tweets: The futile attempt to recycle Austrianism (IX)

 

#Economics#FailedFakeScience#Economists#StupidOrCorruptOrBoth

The history of economic thought is the history of scientific failure. #Austrianism is NOT #Science but political #AgendaPushing.

Austrianism ― axiomatically falsehttps://t.co/luMh1D2TkS pic.twitter.com/AqMQWvnPuD

— E.K-H (@AXECorg) October 24, 2022

Occasional Xs: The history of economic thought is the history of scientific failure (XIII)

 

The history of economic thought is the history of scientific failure. The major approaches are axiomatically false & materially/formally inconsistent & ALL got #Profit wrong. Jevons was NO exception.

How the representative economist gets it wrong big-timehttps://t.co/em83TvoicF

— E.K-H (@AXECorg) October 17, 2023