Tag Archives: overshoot

A modest proposal for generating useful analyses of economies

[Published in Real World Economic Review #95, Davies, Geoff (2021) “A modest proposal for generating useful analyses of economies: a brief note.” real-world economics review, issue no. 95, 22 March, pp. 118-123, http://www.paecon.net/PAEReview/issue95/Davies95.pdf. Some other comments are at https://rwer.wordpress.com/comments-on-rwer-issue-no-95/ and https://rwer.wordpress.com/2021/03/25/a-modest-proposal-for-generating-useful-analyses-of-economies/.

This is written for ‘heterodox’ economists, those who recognise mainstream (neoclassical) economics is nonsense, but who seem to flounder around not knowing what to do instead. It is a little more technical than my usual posts, but the message does not depend on the details.]

I propose that economists leave philosophy alone for a while and instead try analysing some actual economic observations.

I have observed much discussion among heterodox economists about what science comprises, whether one could do “scientific” economics, and what ontology, epistemology, etc, etc, might be involved. If, for example, economies are historically contingent, how could one hope to do a rigorous analysis. I have also observed much concern about the complications of people and societies and the resulting alleged need for elaborate statistical analyses to extract an object of interest, followed by the construction of an elaborate mathematical model that includes many nuances of human behaviour.

I think the challenge is not nearly so daunting. An economic analysis does not have to emulate the precision of (some) laboratory physics to be useful. It does not have to yield a literal prediction. If one steps out of the equilibrium mindset of the neoclassical mainstream one can find obvious phenomena crying out for explanation, a financial market crash for example.

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