Re: A priorism v. realism: was RE: Paul D. on this year's Nobel -

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

Re. the following:

> I'm quickly coming to the conclusion that there is no point in attempting
to
> further pursue this matter, given that your response is effectively, a
> non-response.

You raised - and I answered - the question "Where do axioms in economics
come from?" in the specific context of my comments on the essential
relationships between Money, Economic Agents, and Production.

The same question may be raised with respect to the axioms of Quesnay's
Tableau Economique as well as with respect to the modus operandi of the
French Physiocrats, of which Adam Smith wrote as follows:

"This system, however, with all its imperfections is, perhaps, the nearest
approximation to the truth that has yet been published upon the subject of
political economy, and is upon that account well worth the consideration of
every man who wishes to examine with attention the principles of that very
important science." (Book IV, Ch. 9)

At the outset of the chapter, Smith wrote of this axiomatic system as
follows:

"That system which represents the produce of land as the sole source of the
revenue and wealth of every country has, so far as I know, never been
adopted by any nation, and it at present exists only in the speculations of
a few men of great learning and ingenuity in France.  It would not, surely,
be worth while to examine at great length the errors of a system which never
has done, and probably never will do, any harm in any part of the world.  I
shall endeavour to explain, however, as distinctly as I can, the great
outlines of this very ingenious system."

And where did the axioms of the Physiocrats come from?

They - as well as those reflected in my paper on 'Principles of Economics' -
come from the source which Einstein identified with respect to theoretical
physics as follows:

"There is no logical path to these laws; only intuition, resting on
sympathetic understanding of experience, can reach them."

A general answer along these lines struck me as non-responsive in the
context at hand.

Gunnar

----- Original Message -----
From: "Clifford Poirot" <cpoirot@xxxxxxxxxxx>
To: <pkt@xxxxxxxxxxxxxxxx>
Sent: Friday, October 18, 2002 9:45 AM
Subject: Re: A priorism v. realism: was RE: Paul D. on this year's Nobel -


> I'm quickly coming to the conclusion that there is no point in attempting
to
> further pursue this matter, given that your response is effectively, a
> non-response.
>
> This is an important epistemological and ontological issue. Some
> Post-Keynesians are asserting that they are using axioms in the same
fashion
> as they are used in algebra and geometry, without explaining how we can
have
> the equivalent of isosceles triangles in the world of human interaction.
>
> I think the basis for pursuing this discussion on this list ought to be a
> starting point other than "go read my paper/book/archives etc.".
>
> -----Original Message-----
> From: Gunnar Tomasson [mailto:gunnar.tomasson@xxxxxxxxxxx]
> Sent: Thursday, October 17, 2002 6:08 PM
> To: Clifford Poirot; pkt@xxxxxxxxxxxxxxxx
> Subject: Re: A priorism v. realism: was RE: Paul D. on this year's Nobel
> -
>
>
> Re.the following:
>
> > I understand where an axiom comes from in algebra and geometry. Where do
> > axioms come from in economics?
>
> Comment:
>
> My 1982 paper on 'Principles of Economics' summarized the results of
> extensive research into the subject matter over several years, with the
> axiomatic approach reflected therein emerging gradually in the course of
the
> research itself.
>
> Once it had crystallized in my own mind, I discovered that Bentham (a) had
> used the like approach in his work on monetary economics, and (b) had
> credited Adam Smith with its initial formulation. (See my note on Bentham
in
> the gang8 archive.)
>
> Gunnar
>
>
>
> ----- Original Message -----
> From: "Clifford Poirot" <cpoirot@xxxxxxxxxxx>
> To: "'Gunnar Tomasson'" <gunnar.tomasson@xxxxxxxxxxx>;
> <pkt@xxxxxxxxxxxxxxxx>; "Clifford Poirot" <cpoirot@xxxxxxxxxxx>
> Sent: Thursday, October 17, 2002 5:07 PM
> Subject: RE: A priorism v. realism: was RE: Paul D. on this year's Nobel -
>
>
> > I read this paper and while it has much to commend it, I find that it
did
> > little to clarify my confusion. You state in this paper (if I understand
> you
> > correctly) that economics is a deductive science like algebra and
> geometry.
> > I understand where an axiom comes from in algebra and geometry. Where do
> > axioms come from in economics?
> >
> > -----Original Message-----
> > From: Gunnar Tomasson [mailto:gunnar.tomasson@xxxxxxxxxxx]
> > Sent: Thursday, October 17, 2002 3:38 PM
> > To: pkt@xxxxxxxxxxxxxxxx; Clifford Poirot
> > Subject: Re: A priorism v. realism: was RE: Paul D. on this year's Nobel
> > -
> >
> >
> > Clifford:
> >
> > My working paper on 'Principles of Economics' in "the gang8 archive" at
> > www.creditary-economics.org illustrates my own use of the method a
priori
> > for conceptualizing the essential relationships between Money, Economic
> > Agents, and Production.
> >
> > Gunnar
> >
> > ----- Original Message -----
> > From: "Clifford Poirot" <cpoirot@xxxxxxxxxxx>
> > To: <pkt@xxxxxxxxxxxxxxxx>
> > Sent: Thursday, October 17, 2002 11:47 AM
> > Subject: Re: A priorism v. realism: was RE: Paul D. on this year's
Nobel -
> >
> >
> > > Perhaps you can help me out then Gunnar, because I am confused not
just
> as
> > > to the meaning of your post, but as to the meaning of much that is
said
> > > here. No doubt, the problem lies in my inability to think clearly
about
> > this
> > > matter.
> > >
> > > How will we come to understand the nature of monetary relationships?
How
> > can
> > > we decide on what distinguishes money from other commodities? How can
we
> > > understand the actual functioning of modern monetary relations? Where
do
> > our
> > > categories come from? How do we get our axioms?
> > >
> > > -----Original Message-----
> > > From: Gunnar Tomasson [mailto:gunnar.tomasson@xxxxxxxxxxx]
> > > Sent: Wednesday, October 16, 2002 4:09 PM
> > > To: pkt@xxxxxxxxxxxxxxxx
> > > Subject: Re: A priorism v. realism: was RE: Paul D. on this year's
Nobel
> > > - Addendum
> > >
> > >
> > > Here are brief comments on the following:
> > >
> > > > Now, if Gunnar wants to hold with Plato that we can know the eidos
of
> > > humans
> > > > and of human behavior by grasping the eidos of humans from the realm
> of
> > > > forms, than please, by all means, make that argument and sketch it
out
> > for
> > > > economics.
> > >
> > > As noted before, the arguments in favor of the a priori method do not
> > > include access to the Mind of God.
> > >
> > > In my view, however, the method a priori is a sine qua non for clear
> > > conceptualization - in the realm of forms - of the essential
> relationships
> > > between Money, Economic Agents, and Production.
> > >
> > > For, absent intellectual clarity with respect thereto, real-world
> monetary
> > > arrangements at both national and international levels must
necessarily
> > > evolve along lines of least resistance - that is, along lines favored
by
> > > financial and political vested interests as in the post-Bretton Woods
> > > period.
> > >
> > > And, while such interests will not be swayed by mere technical
monetary
> > > arguments, I have long been persuaded that as and when post-Bretton
> Woods
> > > monetary arrangements come crashing down, a window of opportunity will
> > arise
> > > in the political sphere for monetary reconstruction along lines
> indicated
> > by
> > > technical considerations as distinct from vested interests.
> > >
> > > Gunnar
> > >
> > >
> > > ----- Original Message -----
> > > From: "Clifford Poirot" <cpoirot@xxxxxxxxxxx>
> > > To: <pkt@xxxxxxxxxxxxxxxx>
> > > Sent: Wednesday, October 16, 2002 2:00 PM
> > > Subject: A priorism v. realism: was RE: Paul D. on this year's Nobel -
> > > Addendum
> > >
> > >
> > > > Gunnar argues below that the proper way to conceive of economics is
a
> > > system
> > > > of formal, deductive logic. John Stuart Mill, one of my all time
> > favorite
> > > > writers, was an excellent practitioner of such logic. Using such
> > > remorseless
> > > > logic Mill showed clearly the importance of free speech, the need
for
> an
> > > > active welfare state and the necessity of treating women as equals.
> > These
> > > > are three good reasons for liking Mill. Let me point out though,
that
> > > these
> > > > are normative issues (not that normative is bad). Logic is an
> excellent
> > > > system for seeing normative implications and issues clearly.
However,
> as
> > > Sen
> > > > and Nussbaum have shown repeatedly, in order to derive normative
> > > conclusions
> > > > we must start from essences "that which is the underlying identity
or
> > > nature
> > > > of a thing throughout the process of change from potentiality to
> > > actuality"
> > > > (see Essence, Aristotelian, Dictionary of Philosophy, Peter A.
> Angeles).
> > > > Now, if Gunnar wants to hold with Plato that we can know the eidos
of
> > > humans
> > > > and of human behavior by grasping the eidos of humans from the realm
> of
> > > > forms, than please, by all means, make that argument and sketch it
out
> > for
> > > > economics.
> > > >
> > > > As for myself, I prefer Aristotle, which means as I pointed out in a
> > > > previous post, our conception of the essence of human and of human
> > > behavior
> > > > must come from our observations of humans.
> > > >
> > > > Logic is an excellent and powerful tool. However, to believe that
> social
> > > > sciences is a system of "pure logic" is to fall into a vise like
trap.
> > > >
> > > > I do agree though with Gunnar's last sentence:"If the real-world is
> > > > NON-ergodic, then it is impossible to construct an
> > > > "apparatus of the mind" which mirrors it in such manner that
> > "conclusions"
> > > > drawn within the "apparatus" are at once "correct" insofar as
> real-world
> > > > policy issues are concerned."
> > > >
> > > > Indeed, there is no guarantee that our axioms are the correct and
> > > applicable
> > > > axioms. In fact, I would deny that we have "axioms" in ths social
> > sciences
> > > > in the strict meaning of the term.
> > > >
> > > > Sorry to repeat the same points I made in an earlier post, but
people
> > keep
> > > > making these assertions without dealing with the underlying
> > philosophical
> > > > problems.
> > > >
> > > > Or,perhaps, I am just used to living in the cave and the realm of
> > shadows.
> > > >
> > > > -----Original Message-----
> > > > From: Gunnar Tomasson [mailto:gunnar.tomasson@xxxxxxxxxxx]
> > > > Sent: Tuesday, October 15, 2002 11:58 AM
> > > > To: pkt@xxxxxxxxxxxxxxxx
> > > > Subject: Re: Paul D. on this year's Nobel - Addendum
> > > >
> > > >
> > > >
> > > > The following explanatory comments may be helpful:
> > > >
> > > > As noted in an earlier posting to PKT, Keynes' 1922 definition was
not
> > > > original - except for the "correct" qualification, it restates John
> > Stuart
> > > > Mill's definition of the "science of political economy" as one whose
> > > method
> > > > is the method 'a priori'.
> > > >
> > > > In other words, "theory" in that sense is a purely axiomatic
structure
> > all
> > > > of whose "conclusions" are deduced logically from some given set of
> > > > axiomatic premises.
> > > >
> > > > Given this concept of "theory", its usefulness - if any - is akin to
> > that
> > > > which Isaac Stern once ascribed to finger exercises for students of
> the
> > > > violin, namely, they must first master the technique involved before
> > > > attempting to let their imagination fly.
> > > >
> > > > In other words, one does not "feed assumptions" into the
"apparatus",
> > > > whereby would-be economic theorists train their minds for useful
> > > application
> > > > to real world economic problems.
> > > >
> > > > In this view of "theory", whatever "conclusions" a trained mind
> arrives
> > at
> > > > with respect to real-world economic policy issues are NOT "correct"
> any
> > > more
> > > > than a particular rendering of Brahm's violin concerto is
"correct" -
> in
> > > > both cases, individuals do the best they can.
> > > >
> > > > If the real-world is NON-ergodic, then it is impossible to construct
> an
> > > > "apparatus of the mind" which mirrors it in such manner that
> > "conclusions"
> > > > drawn within the "apparatus" are at once "correct" insofar as
> real-world
> > > > policy issues are concerned.
> > > >
> > > > Gunnar
> > > >
> > > >
> > > > From: "Gunnar Tomasson" <gunnar.tomasson@xxxxxxxxxxx>
> > > > To: <koppl@xxxxxxx>; "James Juniper" <James.Juniper@xxxxxxxxxxxx>
> > > > Cc: <pkt@xxxxxxxxxxxxxxxx>; "Gang8" <gang8@xxxxxxxxxxxxxxx>
> > > > Sent: Monday, October 14, 2002 11:23 PM
> > > > Subject: Re: Paul D. on this year's Nobel
> > > >
> > > >
> > > > > 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.  It
âs
> > > > 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
> > > > > >
> > > > > >
> > > > > > --
> > > > > >
> > > > >
> > > > >
> > > >
> > >
> >
>