Bob Solow on the post keynesians

[Paul Davidson <PB108928%UTKVM1.BITNET@xxxxxxxxxxxxxxxxx>]

FROM:  Paul Davidson
"      Economics Department
"      523 Stokely Management Center     974-4221
Dear Ric:  There is a long history to Bob Solow's quote. He was originally the
only discussant of my paper "Reviving Keynes's Revolution" (JPKE, 1984) when
it was presented at a conference in 1983 at Drew University to celebrate the
100th anniversary of Keynes's birth. This is the paper wher I explicitlylisted
the nonergodic conditions for Keynes's system. Bob did not like the paper (to
say the least!) Nevertheless, bof what we observe cannot be treated as a rerali
zation of a stationary stochastic process without straining credulity". Non-
stationarity is a sufficient, but not a necessary condition for nonergodicity!
Solow goes on to say "My impression is that the best and the brightest in the p
rofession proceed as if economics is the physics of society. There is a single
universally applied valid model of the world... You could drop a modern economi
st from a time machine [Note: time does not matter --it is an ergodic system]..
ering to ask what time and which place" (p.330)   Solow concludes"we need a dif
ferent approach".
      Thus Ric Solow has provided an eloquent defense for Post Keynesian
emphasis on nonergodicity as the essence. I keep arguing that Keynes already
came up with a coherent positive theory alternative to classical and neoclassic
al thought. If it is apparently clear to modern trained economists, you have
to realize that the thoery of stochastic processes was being developed bythe Mo
Moscow mathematical school of Probability in the mid-1930s. At the time
Keynes wrote the ergodic axiom had not been explicitly formulated -- although
it had been used implicitly in 19th century physics. My Post Keynesian Macro
Economic Theory book attempts to put the positive Keynes  alternative into
a lexicon that modern classical economists understand.

     By the way in a 1969 article Samuelson makes what he calls "the ergodic
hypothesis" the sine qua non of a hard science arguing that it was the
basis of 19th century physics and celestial mechanics. But 20th century
physicists have discovered nonergodic  phenomena in their discipline. Thus
according to the Samuelson "hard-science" criterion 20 th century physics is
not a science at all. Nor can, if Samuelson is correct, Keynes's general thoery
or Post Keynesian theory by a hard science -- since these are based on the
belief that the future is transmutable by human action. Samuelson clearly is on
 of "the best and the brightest in the profession" which Solow suggests has led
economics down the wrong path in the 20th century. Paul Davidson

Have a good day!