Re.
the following:
It is
not clear to me what is gained by treating economics as a form of "geometry"
when economics lays claim to knowledge of the phenomenal, rather than the
nouminal realm. Or are economists now claiming, like Plato, to have knowledge of
the "eidos" of the economy, and hence, the ability to ascend to
God?
Comment:
This
hits the nail squarely on the head!
For
"when economics lays claim to knowledge of the phenomenal", then the only
relevant test of adequacy is how its predictions accord with outcomes
- then Friedman's positivist view of "theoretical" economics is, in
principle, irrefutable.
As for
the method a priori - the one favored by John Stuart Mill, Keynes
(1922), and Schumpeter (economics as "a branch of logic") - the arguments in its
favor do not include access to the mind of God.
Gunnar
----- Original Message -----
Sent: Monday, October 07, 2002 3:22
PM
Subject: Re: Postulates of classical
economics
I
question whether any of those can in the Euclidean sense of the word axiom, be
usefully termed "axioms". As Paul rightly pointed out in a previous e-mail, an
axiom is simply accepted: a triangle has three sides.
Being a good empiricist, I do not believe we have
such axioms in the strict sense of the usage of the term, "axiom". The best I
think we do is to generate some principles that we believe are such
standardized regularities, we use them "as if" they were axioms. At the risk
of being pedantic, let me point to the famous dictum:
Socrates is a Man
All
Men are Mortal
Therefore, Socrates is Mortal.
I
submit that the concept of "Man" (or of human) is a term that we come to know
through experience and observation, in combination with reason. That is,
following Aristotle we are able to arrive at a generally accepted definition
of "human" that encapsulates phenomenal essences that distinguish human from
other animals. We accept that a property of human (which is shared with other
species of animal) that humans are "mortal". But this is not an axiom, nor is
the definition of human an "axiom", unless we agree to call commonly accepted
definitions "axioms".
It
seems to me that science (including the social scienes) entails deduction,
from previously accepted conclusions, derived by the combination of reason and
observation as well as induction-using reason in combination with observation,
to arrive at new hypotheses and theories.
It
is not clear to me what is gained by treating economics as a form of
"geometry" when economics lays claim to knowledge of the phenomenal, rather
than the nouminal realm. Or are economists now claiming, like Plato, to have
knowledge of the "eidos" of the economy, and hence, the ability to
ascend to God?
Are
we all neo-platonists now?
At 02:29 PM 10/7/02 +0900, you
wrote:
Keynes, as is well known, rejected the
second postulate of classical economics in the sense that "the wage-goods
equivalent of the exsiting money-wage is not an accurate indication of the
marginal disutility of labor"(GT, p. 10).
However, he attacked neither
concept of production function nor utility function. He didn't attack the
maximaization and optimization at all. And he didn't explicitly insist
that we can't draw the same labor supply curve as the classical economists
do. There is an obvious contrast, compared to his insist that we can't
draw saving curve as the function of interest rate as the classical
economists do (See chap. 14).
The possible interpretation is that of
Clower. Clower, as is well known, regarded his rejection of second
postulate as the criticisim against the classical economics that it
doesn't provide an adequate account disequilibrium phenomenon, and
insisted that Keynes didn't reject the generality of classical economics
(See "The Keynesian counter-revolution: A theoretical appraisal"). And
Clower opened the route toward the studies toward the microfoundation of
Keynesian economics.
However, such a lot of post-Keynesian as the
member of this mailing list wouldn't be satisfied by Clower's
interpretation due to various reasons. So what is the critical point when
Keynes attacked the classical economics?
IF YOU
DON'T KNOW, YOU HAVEN'T READ EITHER MY ARTICLE "REVISING THE KEYNESIAN
REVOLUTION" OR MY BOOK POST KEYNESIAN MACROECONOMIC THEORY.
Keynes
specifically rejected three classical restrictive axioms -- although he did
not know the names of two of the axioms -- since they had not yet been
named.
The three axioms were:
(1) the ergodic axiom in
stochastic models (or the ordering axiom in deterministic models) --rejected
by Keynes's concept of uncertainty.
(2) the gross substitution axiom --
rejected by chapter 17 of the GT
(3) the neutrality of money
axiom.
Paul
Paul Davidson
Editor, JOURNAL OF POST KEYNESIAN ECONOMICS
Economics Department - University of Tennessee
503 SMC
Knoxville, Tennessee 37996-0550
work phone: (865) 974-4221
fax: (865) 974-4601/ (865) 974-1686
home phone and fax (865) 692-0802