To derive testable implications, one also needs subsidiary assumptions concerning probability distributions, measurement devices, proxies for unmeasured variables, the absence of interferences, and so forth. These problems arise generally, and Popper proposes that they be solved by a methodological decision to regard a failure of the deduced testable implication to be a failure of the theory. But in economics the subsidiary assumptions are dubious and in many cases known to be false. Making the methodological decision that Popper requires is unreasonable and would lead one to reject all economic theories.
Imre Lakatos , who was for most of his philosophical career a follower of Popper, offers a broadly Popperian solution to this problem. Lakatos insists that testing is always comparative. When theories face empirical difficulties, as they always do, one attempts to modify them. Lakatos appears to solve the problem of how to appraise mainstream economic theory by arguing that what matters is empirical progress or retrogression rather than empirical success or failure. In addition members of a research programme accept a common body of heuristics that guide them in the articulation and modification of specific theories.
For it is questionable whether the development of neoclassical economic theory has demonstrated empirical progress. Furthermore, despite his emphasis on heuristics as guiding theory modification, Lakatos still emphasizes testing. Science is for Lakatos more empirically driven than mainstream economics has been Hands Both maintain that there is no such thing as empirical confirmation for some late qualms, see Lakatos Popper and Lakatos maintain that evidence never provides reason to believe that scientific claims are true, and both also deny that results of tests can justify relying on statements in practical endeavours or in theoretical inquiry.
There is no better evidence for one unfalsified proposition than for another. With the notable exception of Watkins , few philosophers within the Popperian tradition have faced up to this challenging consequence. One radical reaction to the difficulties of justifying the reliance on severe simplifications is to deny that economics passes methodological muster.
Alexander Rosenberg maintains that economics can only make imprecise generic predictions, and it cannot make progress, because it is built around folk psychology, which is a mediocre theory of human behavior and which owing to the irreducibility of intentional notions cannot be improved. Complex economic theories are scientifically valuable only as applied mathematics, not as empirical theory.
But his view that it has made no progress and that it does not permit quantitative predictions is hard to accept. For example, contemporary economists are much better at pricing stock options or designing auctions than economists were even a generation ago. In her view, the only relevant and significant criteria for assessing the practices and products of a discipline are those accepted by the practitioners.
Apart from a few general standards such as honesty and a willingness to listen to criticisms, the only justifiable criteria for any conversation are those of the participants.
Economists can thus dismiss the arrogant pretensions of philosophers to judge economic discourse. Whatever a group of respected economists takes to be good economics is automatically good economics. Philosophical standards of empirical success are just so much hot air. Her philosophical critiques are problematic, because the position sketched in the previous paragraph is hard to defend and potentially self-defeating. It is hard to defend, because epistemological standards have already influenced the conversation of economists.
The standards of predictive success which lead one to have qualms about economics are already standards that many economists accept. The only way to escape these doubts is to surrender the standards that gave rise to them. Furthermore, as Rosenberg has argued , it seems that economists would doom themselves to irrelevance if they were to surrender standards of predictive success, for it is upon such standards that policy decisions are made.
McCloskey does not, in fact, want to preclude the possibiity that economists are sometimes persuaded when they should not be or are not persuaded when they should be. For she herself criticizes the bad habit some economists have of conflating statistical significance with economic importance , ch. McCloskey typically characterizes rhetoric descriptively as the study of what in fact persuades, but sometimes she instead characterizes it normatively as the study of what ought to persuade , ch.
And if rhetoric is the study of what ought rationally to persuade, then it is methodology, not an alternative to methodology. Questions about whether economics is a successful empirical science cannot be conjured away. Methodologists have, on the other hand, vigorously debated the goals of economics, but those who argue that the ultimate goals are predictive such as Milton Friedman do so because of their interest in policy, not because they seek to avoid or resolve epistemological and semantic puzzles concerning references to unobservables. Nevertheless there are two important recent realist programs in economic methodology.
The second, which is espoused by Tony Lawson and his co-workers, mainly at Cambridge University, derives from the work of Roy Bhaskar see Lawson , , Bhaskar et al. In attempting to identify regularities on the surface of the phenomena, mainstream economists are doomed to failure. Economic phenomena are in fact influenced by a large number of different causal factors, and one can achieve scientific knowledge only of the underlying mechanisms and tendencies, whose operation can be glimpsed intermittently and obscurely in observable relations.
See also the entry on scientific realism.
Throughout its history, economics has been the subject of sociological as well as methodological scrutiny. Since every political program finds economists who testify to its economic virtues, there is a never-ending source of material for such critiques. For example, in the wake of the near collapse of the international financial system in , American economists who argued for austerity were mostly Republicans, while those who defended efforts to increase aggregate demand were mostly Democrats.
The influence of contemporary sociology of science and social studies of science, coupled with the difficulties methodologists have had making sense of and rationalizing the conduct of economics, have led to efforts at fusing economics and sociology Granovetter , Swedberg , as well as to a sociological turn within methodological reflection itself. Rather than showing that there is good evidence supporting developments in economic theory or that those developments have other broadly epistemic virtues, methodologists and historians such as D. Roy Weintraub have argued that these changes reflect a wide variety of non-rational factors, from changes in funding for theoretical economics, political commitments, personal rivalries, attachments to metaphors, or mathematical interests.
Furthermore, many of the same methodologists and historians have argued that economics is not only an object of social inquiry, but that it can be a tool of social inquiry into science. By studying the incentive structure of scientific disciplines and the implicit or explicit market forces impinging on research including of course research in economics , it should be possible to write the economics of science and the economics of economics itself Hands , Hull , Leonard , Mirowski and Sent Exactly how, if at all, this work is supposed to bear on questions concerning how well supported are the claims economists make is not clear.
In his Reflection without Rules D.
Hands maintains that general methodological rules are of little use. He defends a naturalistic view of methodology and is skeptical of prescriptions that are not based on detailed knowledge. But he does not argue that no rules apply.
The above survey of approaches to the fundamental problems of appraising economic theory is far from complete. The above discussion documents the diversity and disagreements concerning how to interpret and appraise economic theories. It is not surprising that there is no consensus among those writing on economic methodology concerning the overall empirical appraisal of specific approaches in economics, including mainstream microeconomics, macroeconomics, and econometrics.
When practitioners cannot agree, it is questionable whether those who know more philosophy but less economics will be able to settle the matter. Since the debates continue, those who reflect on economic methodology should have a continuing part to play. Meanwhile, there are many other more specific methodological questions to address, and it is a sign of the maturity of the subdiscipline that a large and increasing percentage of work on economic methodology addresses more specific questions. There is plethora of work, as a perusal of any recent issue of the Journal of Economic Methodology or Economics and Philosophy will confirm.
The Twentieth Century: Moore to Popper: Introduction. (pp. ). John Shand. The turn of the century, from the nineteenth to the twentieth, marked a significant . Central Works of Philosophy, Volume 4: The Twentieth Century: Moore to Popper [John Shand] on solxoudyssettki.tk *FREE* shipping on qualifying offers. Ranging.
Some of the range of issues currently under discussion were mentioned above in Section 2. Here is a list of three of the many areas of current interest:. Although more concerned with the content of economics than with its methodology, the recent explosion of work on feminist economics is shot through with methodological and sociological self-reflection. The fact that a considerably larger percentage of economists are men than is true of any of the other social sciences and indeed than most of the natural sciences raises questions about whether there is something particularly masculine about the discipline.
Since , there has been a journal, Feminist Economics , which pulls together much of this work. During the past decades, laboratory experimentation in economics has expanded rapidly. Laboratory experimentation has many different objectives see Roth and apparently holds out the prospect of bridging the gulf between fundamental economic theory and empirical evidence.
watch Some of it casts light on the way in which methodological commitments influence the extent to which economists heed empirical evidence. A good deal of laboratory experimentation in contemporary economics is in the service of behavioral economics, which prides itself on heeding experimental evidence concerning the structure and determinants of individual choices.
Although behavioral economics has secured a foothold within mainstream economics, it remains controversial substantively and methodologically, and its implications for normative economics, discussed below in section 6, are controversial. For example, in the case of preference reversals, discussed briefly below in Section 5. But economists have been generally unwilling to pay serious attention to the theories proposed by psychologists that predicted the phenomena before they were observed.
The reason seems to be that these psychological theories do not have the same wide scope as the basic principles of mainstream economics Hausman , chapter Hesitation concerning neuroeconomics Camerer et al. They are at most of heuristic value. They maintain that the findings of behavioral economics are irrelevant to economics, because they do not concern market choices and their consequences, which are the only germane data. Sometimes Gul and Pesandorfer appear to identify economic theory with the empirical consequences economists are concerned with, while at other points they echo Milton Friedman see section 3.
They do not address sophisticated defenses of realism concerning mental states like Dietrich and List But it is clear that the methodological commitments governing theoretical economics are much more complex and more specific to economics than the general rules proposed by philosophers such as Popper and Lakatos.