Re: Re. more squiggly lines

[Alan G Isaac <aisaac@xxxxxxxxxxxx>]

On Thu, 1 Aug 2002 14:10:42 -0400 Gunnar Tomasson <gunnar.tomasson@xxxxxxxxxxx> wrote:
> As I read your comments below, you do not accept the validity of
> Paul Samuelson's distinction between a meaningful theorem, on the
> one hand, and its opposite or meaningless theorem, which he
> summarized as follows (Foundations, p. 4):
> "By a meaningful theorem I mean simply a hypothesis about empirical
> data which could conceivably be refuted, if only under ideal
> conditions.  A meaningful theorem may be false.  It may be valid but
> of trivial importance.  Its validity may be indeterminate, and
> practically difficult or impossible to determine.  Thus with
> existing data, it may be impossible to check upon the hypothesis
> that the demand for salt is of elasticity - 1.0.  But it is
> meaningful because under ideal circumstances an experiment could be
> devised whereby one could hope to refute the hypothesis."

Of course you recall that Samuelson was just a graduate student
when writing Foundations.  A damn smart graduate student of course,
but it is not clear why you would expect him not only to remake the
entire profession by showing how a few simple mathematical tools could
unify and clarify the extant mainstream theory but also become a
careful discussant of the philosophy of science.  Instead, as we all
know from his exchanges with Friedman, economic titans can give us
some very crude statements outside the field of their expertise.
However, as many more charitable than you have noted, crude is not
the same as valueless, even if they were simply throwing at each
other the popular trends as they encountered them in the philosophy
of science.  In Samuelson's claim above we see a simplified reference
to Popper's falsificationism, so to really side with Samuelson's claim
here would be to side with a philosophy that even in much more
sophisticated versions has come under tremendous critique.

That said, there is of course a grain of truth to it.  If as a matter
of logic a proposition supposedly about the world allows of no data
that could challenge the proposition, it does not matter too much
whether we call the proposition "meaningless" (although that is often
wrong and reflects positivist excesses that were popular at the time)
or pointless.

So the question becomes, have economists offered propositions about
the world that are not pointless (in the above sense).  There anyone
who reads the empirical literature will of course have to concede that
they have.  Sometimes these are formulated verbally, and sometimes the
conversation takes place mathematically (a fact that for some reason
irks you), but certainly economists make claims about the world which
can be challenged by economic data (are in fact are challenged and
occasionally discarded). Of course whether these propositions can
stand up to empirical investigation goes beyond the point you raised.

> The fact that no meaningful theorem has yet been formulated leaves
> but three options, namely, (1) to lower the bar, as it were, and
> place economics among those branches of human speculation which
> cannot be falsified; (2) to re-define economics as a branch of
> mathematics - the preferred option of Samuelson and Lucas; or (3) to
> throw out the neo-classical legacy and go back to basics.

As you see, you have claimed as fact yet another falsehood.  And so it
should not surprise you that like the physicists, economists (wisely)
ignore your rants and continue to go about their business.

Cheers,
Alan