Re: Paul D. on this year's Nobel

["Gunnar Tomasson" <gunnar.tomasson@xxxxxxxxxxx>]

Re. the following:

>  I think itâs fair to say that for
> Keynes, investors are irrational *because* the world is nonergodic.
Rational
> actions require adequate epistemological foundations.  If these
foundations are
> absent, rational action is impossible.  (All this in *Keynes* opinion.
My
> opinions are irrelevant here.)

Comment:

There is another epistemological question involved - one to which Keynes
gave an implicitly affirmative answer in his 1922 definition of what
constitutes "The Theory of Economics":

"[It] does not furnish a body of settled conclusions immediately applicable
to a policy.  It is a method rather than a doctrine, an apparatus of the
mind, a technique of thinking, which helps its possessor to draw CORRECT
conclusions."

Keynes' use of the term "correct" is either (a) hyperbole, or (b) leap of
logic.

For, while Reason yields "correct" conclusions when applied to some Set of
Axioms - "an apparatus of the mind" such as the General Theory - there is no
warrant in logic to conclude that Reason, on that account, is in principle
capable of leading us to "correct" conclusions with respect to Real-World
policy issues.

The underlying point concerns what, in physics, is known as the distinction
between The Map - Model - and The Territory - Physical Reality.

Gunnar

----- Original Message -----
From: "Roger Koppl" <koppl@xxxxxxx>
To: "James Juniper" <James.Juniper@xxxxxxxxxxxx>
Cc: <pkt@xxxxxxxxxxxxxxxx>
Sent: Monday, October 14, 2002 1:53 PM
Subject: Re: Paul D. on this year's Nobel


> A couple of recent posting address a supposed conflict between two
> interpretations of Keynes.  Loosely, itâs irrationality vs. nonergodicity.
> (Iâll leave aside my criticisms of Paul Davidsonâs use of the term.)  I
think
> itâs a bit of a false dichotomy, however.  I think itâs fair to say that
for
> Keynes, investors are irrational *because* the world is nonergodic.
Rational
> actions require adequate epistemological foundations.  If these
foundations are
> absent, rational action is impossible.  (All this in *Keynes* opinion.
My
> opinions are irrelevant here.)  Thus, if people act when the
epistemological
> foundations for actions are too weak to sustain rational action, they are
by
> definition acting irrationally.  The ânonergodicityâ of the social world
often
> leaves us bereft of  epistemological foundations for action.  Itâs either
> irrational action or no action.  Carabelli and De Vecchi (2000) say
something
> close to that, but for some reason imagine that we follow conventions only
our
> ignorance of is âtotal.â
>
> Cheers,
>
> Roger
>
>
> --
>