Godel Escher Bach art print!
Another interesting discussion of Lars Syl’s Real Economics Blog Page.
‘Modern’ economics has become increasingly irrelevant to the understanding of the real world. In his seminal book Economics and Reality(1997), Tony Lawson traced this irrelevance to the failure of economists to match their deductive-axiomatic methods with their subject
It is — sad to say — as relevant today as it was twenty years ago.
It is still a fact that within mainstream economics internal validity is everything and external validity nothing. Why anyone should be interested in that kind of theories and models is beyond imagination. As long as mainstream economists do not come up with any export-licenses for their theories and models to the real world in which we live, they really should not be surprised if people say that this is not science, but autism!
Studying mathematics and logic is interesting and fun. It sharpens the mind. In pure mathematics and logic, we do not have to worry about external validity. But economics is not pure mathematics or logic. It’s about society. The real world.
Economics and Reality was a great inspiration to yours truly twenty years ago. It still is.
Just to bumper sticker the argument, Steve Keen says, and I agree with him that Economists have maths envy particularly of Physicists, Physicists of the Classical School feel that the Statistical turn which Einstien and Schroedinger regretted was founded in a sort of priestly hubris.
Minsky was always criticised for not using Mathematical models But made a lot of progress as he genuinely was searching for a solution.
My Claim is that Mainstream Economics fails because it is not interested in a Real answer it is only interested in proving it is right, the same goes for the generality of the Mainstream Academic edifice which is an institutionalised Sychophant to the Oligarchy.
Ok, Frank, I read this Paper
The Allocation of Effort?
If the numeraire (generally money) presents an affine transformation from the theoretically valid labour-time measurements then the resulting equations will be representative of the underlying reality
I assume you are a competent mathematician so I haven’t checked your maths.
Regardless of the Maths, your reasoning makes some pretty bold general claims which are not supportable logically.
Money as a measure is Flawed both Abstract and Arbitrary, it is not a concept based in reality it is an Abstract ideal.
The paper is I found rather lacking in scientific rigour and fails to define its terms adequately.
The economy is an energy transformation equation and it is there that you will find scientific empirical data to support the theoretical framework you fail to establish.
The future is an emergent chaotic construct and as such is indefinable, brush up your Tarski so to speak,
Regarding the Boundary conditions for forwarding prediction energy potentials can be abstracted and presented as embodied energy equations as has been achieved in this paper.
I discuss it in this blog post here
I also recommend some Vaclav Smil
And this rather compelling Model here,
which i discuss with its programmer here.
Frank, I found the paper entertaining as far as it went but kept thinking of the Song Castles in the air Saying it is so, in theory, does not make it so in fact and when your metrological magic wand is an abstract ill-defined “Allocation of Effort” we are indeed in the field of metaphysics and not falsifiable scientific rigour.
Heisenberg, Gödel, and Chomsky walk into a bar
Heisenberg looks around the bar and says, “Because there are three of us and because this is a bar, it must be a joke. But the question remains, is it funny or not?”
And Gödel thinks for a moment and says, “Well, because we’re inside the joke, we can’t tell whether it is funny. We’d have to be outside looking at it.”
And Chomsky looks at both of them and says, “Of course it’s funny. You’re just telling it wrong.”
I read the North Essay? am I missing something, looks like metaphysics to me.
Shubick’s paper on Institutional economics takes a lot of beating he says this in it.
”The monetary and financial system of an economy are part of the socio-politico-economic control mechanism used by every state to connect the economy with the polity and society. This neural network provides the administrative means to collect taxes, direct investment, provide public goods, trade. The money measures provide a crude but serviceable basis for the accounting system which in turn, along with the codification of commercial law and financial regulation are the basis for economic evaluation and the measurement of trust and fiduciary responsibility among the economic agents. A central feature of a control mechanism is that it is designed to influence process. Dynamics is its natural domain. Equilibrium is not the prime concern, the ability to control the direction of motion is what counts.
Money and financial institutions provide the command and control system of a modern society. The study of the mechanism, how they are formed, how they are controlled and manipulated and how their influence is measured in terms of social, political, and economic purpose pose questions, not in pure economics, not even in a narrow political economy, but in the broad compass of a political economy set in the context of society. ”