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Bob Shiller Asks "Is Economics A Science?"
Authored by Bob Shiller, originally posted at Project Syndicate,
I am one of the winners of this year’s Nobel Memorial Prize in Economic Sciences, which makes me acutely aware of criticism of the prize by those who claim that economics – unlike chemistry, physics, or medicine, for which Nobel Prizes are also awarded – is not a science. Are they right?
One problem with economics is that it is necessarily focused on policy, rather than discovery of fundamentals. Nobody really cares much about economic data except as a guide to policy: economic phenomena do not have the same intrinsic fascination for us as the internal resonances of the atom or the functioning of the vesicles and other organelles of a living cell. We judge economics by what it can produce. As such, economics is rather more like engineering than physics, more practical than spiritual.
There is no Nobel Prize for engineering, though there should be. True, the chemistry prize this year looks a bit like an engineering prize, because it was given to three researchers – Martin Karplus, Michael Levitt, and Arieh Warshel – “for the development of multiscale models of complex chemical systems” that underlie the computer programs that make nuclear magnetic resonance hardware work. But the Nobel Foundation is forced to look at much more such practical, applied material when it considers the economics prize.
The problem is that once we focus on economic policy, much that is not science comes into play. Politics becomes involved, and political posturing is amply rewarded by public attention. The Nobel Prize is designed to reward those who do not play tricks for attention, and who, in their sincere pursuit of the truth, might otherwise be slighted.
Why is it called a prize in “economic sciences,” rather than just “economics”? The other prizes are not awarded in the “chemical sciences” or the “physical sciences.”
Fields of endeavor that use “science” in their titles tend to be those that get masses of people emotionally involved and in which crackpots seem to have some purchase on public opinion. These fields have “science” in their names to distinguish them from their disreputable cousins.
The term political science first became popular in the late eighteenth century to distinguish it from all the partisan tracts whose purpose was to gain votes and influence rather than pursue the truth. Astronomical science was a common term in the late nineteenth century, to distinguish it from astrology and the study of ancient myths about the constellations. Hypnotic science was also used in the nineteenth century to distinguish the scientific study of hypnotism from witchcraft or religious transcendentalism.
There was a need for such terms back then, because their crackpot counterparts held much greater sway in general discourse. Scientists had to announce themselves as scientists.
In fact, even the term chemical science enjoyed some popularity in the nineteenth century – a time when the field sought to distinguish itself from alchemy and the promotion of quack nostrums. But the need to use that term to distinguish true science from the practice of imposters was already fading by the time the Nobel Prizes were launched in 1901.
Similarly, the terms astronomical science and hypnotic science mostly died out as the twentieth century progressed, perhaps because belief in the occult waned in respectable society. Yes, horoscopes still persist in popular newspapers, but they are there only for the severely scientifically challenged, or for entertainment; the idea that the stars determine our fate has lost all intellectual currency. Hence there is no longer any need for the term “astronomical science.”
Critics of “economic sciences” sometimes refer to the development of a “pseudoscience” of economics, arguing that it uses the trappings of science, like dense mathematics, but only for show. For example, in his 2004 book Fooled by Randomness, Nassim Nicholas Taleb said of economic sciences: “You can disguise charlatanism under the weight of equations, and nobody can catch you since there is no such thing as a controlled experiment.”
But physics is not without such critics, too. In his 2004 book The Trouble with Physics: The Rise of String Theory, The Fall of a Science, and What Comes Next, Lee Smolin reproached the physics profession for being seduced by beautiful and elegant theories (notably string theory) rather than those that can be tested by experimentation. Similarly, in his 2007 book Not Even Wrong: The Failure of String Theory and the Search for Unity in Physical Law, Peter Woit accused physicists of much the same sin as mathematical economists are said to commit.
My belief is that economics is somewhat more vulnerable than the physical sciences to models whose validity will never be clear, because the necessity for approximation is much stronger than in the physical sciences, especially given that the models describe people rather than magnetic resonances or fundamental particles. People can just change their minds and behave completely differently. They even have neuroses and identity problems, complex phenomena that the field of behavioral economics is finding relevant to understanding economic outcomes.
But all the mathematics in economics is not, as Taleb suggests, charlatanism. Economics has an important quantitative side, which cannot be escaped. The challenge has been to combine its mathematical insights with the kinds of adjustments that are needed to make its models fit the economy’s irreducibly human element.
The advance of behavioral economics is not fundamentally in conflict with mathematical economics, as some seem to think, though it may well be in conflict with some currently fashionable mathematical economic models. And, while economics presents its own methodological problems, the basic challenges facing researchers are not fundamentally different from those faced by researchers in other fields. As economics develops, it will broaden its repertory of methods and sources of evidence, the science will become stronger, and the charlatans will be exposed.
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There is only mathematics. Everything else is just some fuckwit's opinion.
Another convert to the philosophy of the late Carl Popper.
Not all the math .............. just most.
Baseless fiat is the "garbage in"...so guess what?
Garbage out.
Like astrology and psychology, economics is neither predictive nor prescriptive. It can't tell you what will happen, why, or what to do about it,
So no, economics is not a science.
science = to do again the same way.
FED failures and fuckups are a science, but economics is not.
Economics is a seance.
"Fields of endeavor that use “science” in their titles tend to be those that get masses of people emotionally involved and in which crackpots seem to have some purchase on public opinion. These fields have “science” in their names to distinguish them from their disreputable cousins."
Psychiatric associations refer to their conferences as "Scientific Conferences". Coincidence? I think not.
Yes! Virginia, there is such thing as Voodoo Science: The Road from Foolishness to Fraud.
http://en.wikipedia.org/wiki/Voodoo_Science
Unfortunately, "Economics" is driven by ideology, politics, favoritism and ascertions without proof. (ipse dixit)
This not to say that there are no honest well meaning Economists who are brave to dissent.
The only function of economic forecasting is to make astrology look respectable.
-John Kenneth Galbraith
Bob:
Science and physics produce repeatable results, verified by mathematics, and absolute testing.
Mathematics has no place in economics, except to create an illusion of direction based on forward speculation, manipulation, and good 'ol who's fuckin who.
Keep the Nobel.
Oh, and Bob, please do share with us how many of the other fields' prizes are sponsor awarded by banks. You know, I hear the foodies are thinking of renaming theirs the James Beard Award for the Culinary Sciences. Why not?
Absolutely. Economics, like the free market or capitalism, has been perverted. The general idea is that political policies are economics because corruption has hijacked the term. The figures do not lie but those with an agenda certainly can and often do. Right Barack? Ben?
Economics is a whore.
Winner.
And I'd trust a whore's economic projections over an economist's. At least the whore has small-business experience.
just like you ?
Re: Economics, like the free market or capitalism, has been perverted.
There's no such thing as a "free market" or "capitalism". These are just words invented by semi-autistic males trying to decribe a utopia.
Why would ANY self-respecting sociopath not manipulate a "market" rendering it "un-free"? Or, perhaps, you are confusing what the word "free" means?
"Why would ANY self-respecting sociopath not manipulate a "market" rendering it "un-free"? Or, perhaps, you are confusing what the word "free" means?"
They have and they are. You are witnessing the product of their pervese decision to destroy capitalism in our economy today. Sick isn't it?
Math is invisible. Unlike physics, chemistry, and biology we can't see it, smell it, or even directly observe it in the universe. And so that has made a lot of really smart people ask, does it actually even EXIST?!?!
https://www.youtube.com/watch?v=TbNymweHW4E
Math is self consistent. It doesn't exist in nature. We use mathematical principles, defined in a closed space (math space,) to describe things we see in nature. It's like a ruler (or measuring tape) is to construction. It's a tool we invented, and use, in it's own units/terms, that we use to approximate and model what's really going on. Some of our models are more accurate than others, but it's what we've got. It's a language more than it is a property of the universe.
Mathematics is a formal language created to describe relationships. Its patterns flow from assumptions, branched by definitions, and we assure that the inferences, elaborations of the assumptions and definitions, are logically valid. To use the structures created within that formal language, the mathematics you find fitting must actually be appropriate to the phenomena you are describing. Currently the mathematics of graphr theory, networks, and probability is more suitable to economics than partial differential equations, and the linear systems are suitable only for small scall and limited duration modelling. Every economic model has to rest on a legal model, "whose interests will be protected?" Wall Street knows the answer it wants. The IT industry grasped for a favorable legal underpinning and created a nightmare, the patenting of arithmetic problems, structures that would naturally be created independently on a massive scale. I note that the IT industry feels no compuction to compensate mathematicians for their astounding contributions. If mathematicians could have patented their creations, vastly more rare and difficult than the typical code that is patented, we'd still be in the 18th century economically. It's a brawl, no holds barred, for the money. The rest is a fairy tale.
"Economics, like the free market or capitalism, has been perverted."
Exactly, and a point nowhere mentioned in this article. Basically, who pays the piper (corporations and government) calls the tune. Come up with anything that fails to support the status quo and see how fast you are isolated and your career grinds to a halt. It used to be called political economy for a good reason, i.e., because the two are inseparable. How convenient for the political class, however, to see them split apart. From this fact, everything else flows, including why economics will never be a true science.
The same problem exists in the hard sciences of course, but only to the degree that it affects the direction of research, not outcomes themsleves. Things like missles, submarines and space craft have to work, and so hard facts cannot be ignored. Economics, OTOH, is always tailored to the prevailing political doctrine, which is to say, that which supports the status quo.
Good luck getting around that obstacle.
The Doctor Steve Keen says economics is based on flawed theories and its adepts (economists) dont even know it because of their lack of mathematical and historical knowledge.
The Steve Keen's Debunking Economics is a must to read for everyone nowadays.
The only thing i know is that i don't want to see any more retarded just as friedman, greenspan, bernanke nor anyone from the zionist tribe exerting influence on the lives of millions. We had enough of that scum.
I can't agree with you any more.
Before defining why / why-not it is called a "Nobel Prize", we must consider the history of how / why Sweden's central bank (Sveriges Riksbank) considered it opportune to regale the Nobel Committee with funds to attach their name to this so-called "prize".
Lest we --intentionally or un-intentionally-- forget the actual name of this "prize" is the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel.
While whether Nobel himself had thought of funding it is of little relevance, the fact that it was created by banking interests right at the time when Milton Friedman was coming into his own in redefining economics to only consider labor and capital to the current school of neoliberal free-market predatory economics, one completely detached from the basis of what makes governments, civil societies, and even state economics, possible (i.e the land and the resources therein and accumulated energy available to exploit by the people around it) is what should be relevant to this story.
Thanks Bob
I think it's more akin to psychic surgery as practiced in the Phillipines.
hahahahaha love it.
i assume this guy just wasn't smart enough to get past the first five pages of human action. nobel schmobel, friggin riksbank propaganda.
I was amazed how he properly labeled the difference between his Nobel "Memorial" prize and the real Nobel prize in the first sentence, then uses the rest of the article to lump them together (ala, "the other prizes").
Yeah, this guy is a true eCONomist, all right. Takes all the arguments that easily disprove the "economics is science" theory, but uses them to make the exact opposite claim.
I hope Taleb rips him a new asshole.
Dr. Duffenschmirtz?
Economics in Gimmelshtump is easy. You just hook up to that big rolling log and start spinning some goat wool or something.
astrology, not astronomy
anyway, the point here: where do you take the control group from? You can't get one, you can't do a serious experiment. Ergo no hard science
The proof is in the pudding, and all the banks are insolvent.
Economics has an irreducable psychological component, psychology is irreducably imbedded in culture, and culture keeps changing. Homosexuality was a mental illness until 1973, when it suddenly wasn't. What's now called "stimulus" would have been termed "cultivating dependency" 50 years ago, when our culture saw handouts as destroying incentive and work ethic. A "science" that changes with cultural fads is no science.
Why, I bet you do not believe in the sciences of astrology, divination, alchemy and phrenology either!
Heretic!
Well I don't, but that witching for water thing is kinda spooky accurate:)
Actually, you'll hit the water table at 30 feet or less in most of the Upper Midwest, but the flow varies. That made people superstitious.
Hey Tyler here is the new 7 figure revolving door.
http://nypost.com/2013/11/06/ray-kelly-in-talks-for-jpmorgan-job/
FUCK RAY KELLY AND HIS RAPIST SON.
It's a fwee markit for "please-men". Why don't you buy your own please-man? Imagine how handy that would be! Maybe when I win lotto ...
Silly Al Capone et al. He didn't buy enough please-men.
Seven figure salary for being in charge of bank security at the Morgue?
*head asplodes*
Can I has ... Obamapoliceman?!!!
Economics is a Science. Henry George wrote "The science of Economics". In it he explains clearly why economics is a science however he qualified his answer with specific and clear reasoned analysis. It is too bad some of our current economists are not introduced to his work "Progress and Poverty". Amerika might not be in the trouble it is in had they done so.
Behavioral economics is also a dead end, since economics is not, at root, about people. It is, as Hayek pointed out, about information. An economy is a self-organizing network that aggregates and processes information. Thus economics has more in common with computer science and computational biology, than it does with classical physics. But professional economists won't discover this until 1) a general theory of complex systems is developed, and 2) the sins of central planning are finally found out.
Re: Behavioral economics is also a dead end, since economics is not, at root, about people.
I think you got this backwards. Economics that ignores humans isn't "about" anything.
Until economics defines the role of sociopaths and how they use bullshit to screw dumbasses how can it "explain" anything?
Economics used to be considered philosophy. There was a reason for that. Philosophy is basically semi-autistic males trying to figure-out how normal people manipulate each other with bullshit, how the dumbasses process the bullshit, and then believe and follow the bullshit. It might be time for economics to get in touch with its roots again. Obviously, all the math isn't doing anybody any good.
Repeating myself again:
Banker Prize for Economics =
Fox Prize for Chicken Coop Design =
Goebbels Prize for Journalism
Economics could be a science. But it is a religious cult.
Just as some "religious leaders" corrupt a message for personal gain, so do some "economics leaders".
We no longer subscribe to superstitious mumbo-jumbo with divine rights and aristocracies. We have scientific proof that you will be richer if you stay poorer. Just wait. Any minute now ...
No, there is absolutely no way economics can ever be a science, as that requires the elimination of human decision making.
Honestly, Mises laid it all out very neatly nearly a century ago.
So, it is not a scientific fact that if you set fire to a theatre then people will head for the exits, because some may choose to stay behind and enjoy getting roasted? Ummm ...
Economics is merely the continuation of Ideology by other means....
The fundamental equation of macro economics, the defintion of GDP
Y = C + I + (X - M)+ Gis not even a differential equation and is basically a tautology...
And, if it's attempting to explain human behavior it's missing the most important letters: BS.
Without taking into account the ability to manipulate semi-psychotic humans with bullshit, well.. that's just bullshit.
Bullshit, ask for it by name!
nothing can put the human uncertainty principle into a mathematical equation; with any probability of seeing it predict performance on a recurrent exact basis.
No way, as human behavior and psyche change human reactions to the same experience down the experience curve something that never happens in Newtonian science; its stays a recurrent law universally.
You cannot build an algorithm to predict economics like a input output function. Its not linear or dynamic programming or any iterative complex function under an integral.
You seem pretty certain of that.
remember Black, merton & scholes equation and the horror show that has created in derivatives?
Proof is eating the pudding!
"As such, economics is rather more like engineering than physics, more practical than spiritual"
Don't you dare defame engineering like that.
Building bridges that fall in rythmic winds indicates complexity of engineering, but the laws that engineering follows are physical laws, not the whims and feelings that drive economists and their profession.
If economics wanted to be a science, they would explore labs and sites that operated under one thought more in order to prove theorems. There is nothing like that
If engineering was like economics ...
The Sydney Harbour Bridge would consist of thousands of men trying to shovel all the water away to reveal dry land.
... and people would still be expected to drive their cars across it.
... the iPhone would be two tin cans and a piece of string ... and the technicians would emphasize the importance of keeping the string loose.
... modern passenger jets would hold 2 passengers and 300 pilots.
... they'd still be trying to analyze radio transmitter circuits using only DC circuit theory.
... they'd do simple DC analysis on a two-transistor one-bit memory circuit, find the exact current flow, declare it to the world without once checking to see that they were wrong. (Okay, okay, I got carried away there. For non-electronics people out there, trust me - or get your electronics guru to explain it to you).
Ah, this brings back some memories ...
... they'd assert that you don't bother plugging in your washing machine because, on average, the agitator doesn't move.
What is the economic value of corruption?
I'm thinking it's a negative number.
How do you put a value on corruption, cronyism, manipulation?
Well, that's the funny bit: corruption adds to the GDP.
GDP is all about moving money around, not about how much better it could've been used if it wasn't misallocated.
The economic value of corruption can be fairly high, if you are corrupt and a politician (I think corrupt and politician may be the same thing)
Scienter
Latin: actual or guilty knowledge; knowingly.
Diplomacy: The art of saying, "Nice doggy" while you search for a bigger stick.
Economics: The art of convincing the doggy that you are playing, "Fetch" while in reality you are beating the crap out of poor doggy with said stick.
i'm sure any of these guys could explain it in five minutes. "the problem is, you've exported all your productive industry (manufacturing, farming, resource extraction) to the third world, you have destroyed the family unit and job security, you have a system that elevates the most useless to the top, and you are being invaded by moochers. and there are two or more sets of laws just to keep things interesting." now since they can't include any of that, gets a little tough to explain.
When Economics addresses the differences in thought between Keynesian-ism and the Austrian thought and build case studies and controlled experiments in labs, then it has an argument about being a science. Until then, no way Jose
What it is now is a way for WS to use the government entities to extract money from citizens...
Here's the deal. If someone is using utility theory to make an argument, they are bullshitting you. Plain and simple.
Economics, krugman style, is bullshit.
Von Mises, Rothbard, Hayek and the rest FTMFW.
The Scientific Method:
You know, just like in economics.
If you take the all the fun stuff out of economics - like politics & sociopaths - then it's not bullshit.
But, anything with politics or sociopaths is all bullshit.
Sociopaths manipulating dumbasses with bullshit IS politics (and religion).
Bullshit, ask for it by name.
When I went to work for Price Waterhouse about thirty years ago, their in-house magazine had edifying quotes in the back, a bit like Forbes. The one that caught my attention was this, "Economists are people who think they understand money better than the people who have it."
Macro-economists today are used just as priests were in the 13th century, to provide a validating incantation over the desperate actions of Politicians and bankers in crisis. How the current Fed regime can justify economic repression is beyond me. They try to force the small investor into risk securities, and brutalise him if he feels that is irresponsible. And yet when the investment bankers scream "we don't have enough sound collateral for repo's!" the Fed thinks up new ways to facilitate the repo market, through change in regulations, assurances, and so forth. The game is afoot, and obvious, and the economists play both handmaiden and priest to the Queen.
That depends on who you are really.
If you are a self-sufficient farmer who can provide for yourself food and shelter without the involvement of the market economy then economy to you is a matter of science.
If you are born into the market economy with no realistic chance to be self sufficient then there is nothing scientific about the economy, it's about people mind gaming each other all the time in a system where the winners think they know why they win when in fact they don't and the losers don't even know they lose when they lose.
Since we live on a planet in which there is no place left where humans aren't in competition for natural resources that means it's never a science.
I'm goin with the guys who say I can borrow my way to prosperity.
Got any money you can lend me? I'll be rich later.
The problem that this writer makes (as with the folk in modern physics) is to equate science with a "model," a series of mathematical expressions that allows one to change variables, run equations, and predict an outcome. This is not what a science is or ever was (and this is why modern physics has failed- seduced by mathematics and models, as the author points out). Nor is science a purely empirical discipline, observing natural phenomena only. Science, as Thomas Kuhn so eloquently described, consists of a paradigm (which is NOT a model). A paradigm is a host of things, instruments for gathering data, a field of data, a set of questions as to what data is relevant to the science and what data is not, methods for empirical observation, a series of hypotheses and theories that are believed by the practitioners of a science to govern the activity of the phenomena that they observe, etc... . Models tend to arise out of these paradigms, but a paradigm is not synonomous with a model.
All the parts of a paradigm interact with the whole of a science. Models do not simply dictate how a science goes about its business. Changes in instrumentation that allow for greater precision, for example, can give rise to new data, which does not fit existing theories, creating anamolies in the existing models. Theories can give rise to new instrumentation (larger and larger supercolliders to find the "god-particle" for example). These new instruments can then find new or unexpected data.
Only by being open to changing data, instrumentation, criteria to determine what data is valid, new theories, etc. can science progress human knowledge and avoid being led down spurious (and in the case of economics or sociology dangerous) paths. A study based purely upon mathematical models is not a science at all. It is logic, which is NOT the language of God, despite what you may have heard. Even the ancients understood that logic was not knowledge.
Sorry, science and math is in fact the language of God. The rest is someone trying to sell you something.
Well said.
An oldie.
Man walking along a road in the countryside comes across a shepherd and a huge flock of sheep. Tells the shepherd, "I will bet you $100 against one of your sheep that I can tell you the exact number in this flock." The shepherd thinks it over; it's a big flock so he takes the bet. "973," says the man. The shepherd is astonished, because that is exactly right. Says "OK, I'm a man of my word, take an animal." Man picks one up and begins to walk away.
"Wait," cries the shepherd, "Let me have a chance to get even. Double or nothing that I can guess your exact occupation." Man says sure. "You are an economist for a government think tank," says the shepherd. "Amazing!" responds the man, "You are exactly right! But tell me, how did you deduce that?"
"Well," says the shepherd, "put down my dog and I will tell you."
Economics is not science. It is religion. And all power has been abdicated to the high priests of the central banks.
Time for more atheists!
"Models in physics"? I thought physics did experiements, made discoveries and came up with laws - like gravity for example. You drop the apple it drops exactly as predicted every damn time, with of course some miniscule modification for the theory of relativity, dark matter, etc.. Physics does not build models. Models are for Climate "science" and economic "science", and policitcal "science", where they never prove anything or predict anything with reliability. As for psychology or sociology, sorry but I can't even use "science" in quotes for that. It is more like witchcraft or astrology, although witchcraft and astrology is more reliable as a predictor. My apologies to all professional witches and astrologers.
A true master explains it better than I here: http://www.youtube.com/watch?v=EYPapE-3FRw
Can someone send that clip to Krugman, Bernanke, et. al. and other stimulus proponents before they completely destroy us with their amateur witchcraft aka macroeconomics.
Take it from an actual physicist, you have no fuckin idea of what you speak....
To wit, what would you call a Monte Carlo simulation of experiment?
So you're a physicist now. Not just a physicist, but an "actual" one. Hm. Ok.
Yes, an actual physicist as opposed to our friend above, who is a poseur....
Do you want to play any other semantics based games?
No.
A wise choice on your part...
Why? Sorry, what game am I playing?
The economist might be fairly accurate if the politicians would leave them alone!
Re: The economist might be fairly accurate if the politicians would leave them alone!
If it wasn't for politics who would bother listening to an economist?
Do you have any verifiable evidence for that theory? I didn't think so.
Actually politicians are much better scientist than economist. At least they can test their theories without destroying whole economies and adjust their theories to more acurately refelct reality. For example: I can count the votes after I give everyone in the hood a free phone. If it works, I keep giving out free phones and if it doesn't I give them something else. For an economist, if stimulus does not work, you just say more is needed or it would have been worse if I did not do it. No one can ever prove the economist right or wrong. Karl Popper would call this a non - falsifiable hypotheis, i.e., it is not science. It is amateur astrology.
Economics is a pseudoscience that pretends to be scientific but mainly seeks anecdotal evidence to support its belief system - kinda like climate change or socialism/obamaism.
i'm no economist .... but it seems to me if you leave out land and debt at the beginning, you've got a problem. (and he's worried about 'behavior' ...sheesh!)
Economics is a soft science (which is an oxymoron, I know).
It is a branch of psychology. Nothing more. Nothing less.
Booms, busts, consumer confidence, consumer sentiment, surveys of this and that.....all 100% psych.
The use of math just gives economics some street cred and quants jobs.
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Economics is no more a science than meteorology is…
They might get some aspects of it right, and in general terms but when the assessed on the big picture?
Well, as they say, "the weatherman was wrong again!"
And so was the economissed.
•?•
V-V
IMO, economics is a science in the same way that an earth-centered universe is a science or maybe in the same way that a non-electric universe is a science.
One can refince it to heck, but ther basic assumptions are flawed... so clear understanding is very difficult.
Change the basic assumptions to reflect reality and all will be clear and simple.
Economics is a creative art. Works are created based upon the needs of the political order. Socrates, "I know nothing," has been updated by the neokeynesians to "I knew nothing until I was called an economist and then I knew all." The neo-eco-math postulates 1+1 = whatever is desired. The neo-eco-chemistry creates gold from paper. The neo-eco-physics finds no limits to money supply growth. Economists are artists first.
Love it!!
Craft + bullshit = spatter-art.
Really, is economics a science? Ask a witchdoctor. www.electanewcongress.com
Economics is not a science, political science is; but there is no Nobel for Political Science because the powers that be don't want anyone to know about alternatives to their rule. Their only interest is in the means by which they can perpetuate themselves through economic control in order to perpetuate their myth, and myths die hard. electanewcongress.com Serfs Up America!
Only an Economist could devise and implement QE 1, QE 2...QE Infinity, flood the world with $ trillions, inflate the biggest asset bubbles in world history, and then publicly muse about the danger of deflation without a hint of self-consciousness at the glaring contradiction.
Economist are no more scientists than are witchdoctors medical Doctors. But, I think a witchdoctor would have delivered far greater benefits to the people of the United States as Chairman of the Federal Reserve than both Greenspan and Bernanke. I don't think the witchdoctor could possibly be as blind to his failures as Economists seem to be either.
Also equating Economists to Engineers is a gross insult to the Engineers.
"But all the mathematics in economics is not, as Taleb suggests, charlatanism." Well, actually, it is. The math, while perhaps consistent as an abstract game, fails to refer to any reality in the world. It is the insistence and assertion that the mathematical game has something (or anything) to do with the real economic situation in which the charlantism consists.
It is entertaining how he ignores the elephant in the room: "Psychological sciences," which economics resembles most closely.
Looks like Shiller forgot to define what a science is. At best economics could be defined as applied statistics. Certainly statistics has a big role to play in what economists study. Additionally, there is nothing wrong with trying to come up with an over-arching theory of how economies function. An excellent example of this is Steve Keen who seems to be applying non-linear dynamics quite successfully to econmics. There's nothing stopping math from playing the same role in economics as it does in finance. Black and Scholes revolutionized finance. The equation is a perfect example of modeling using partial differential equations.
The problem is more ignorance of mathematics that prevents economists from applying it fruitfully and results in sidelining people like Steve Keen. If there is any hope for economics as a discipline, it will come from the new field of econo-physics.
Keen shows at his website that Bernanke, who is reputed to be the world's great expert on the 1930's depression, did not in fact understand the depression. Keen claims that mainstream economists leave money out of their models, a rather surprising omission!
My suggestion to anyone is to take up the study of nonlinear dynamics. A great book on this is by Stephen Strogatz (Hirsch, Smale, Devaney, my favorite, is also excellent).
Here's an amazing example of nonlinear dynamcs applied to biology, the Fitzhugh-Nagumo equations that model the neurone, just to give a peek at the power of this approach to modelling phenomena.
http://scholarpedia.org/article/FitzHugh-Nagumo_model
Here's how the Case Shiller Index
can work to mislead as to real estate
"recovery," though for those who SOLD
the real estate/mortgage bubble, the
relevant question's does it mislead as
to whether the artificial reflating
of the bubble will work out for the
artificial bubble re-inflators.
http://pages.citebite.com/p4v3h4u5ukuk
http://pages.citebite.com/d1i8e3n1t3rpv
I've proposed the Measure of Civic Burden.
An obvious notion, it nonetheless
has core reliable kernal of
measurement value as evidenced by
its deliberate sudden non-
availability.
http://www.nytimes.com/2012/12/10/nyregion/new-york-city-no-longer-discl...
A measure of paying more for
police service and getting
control of oneself and denial
of one's own rights in return,
it's in reality nothing more
than paying more to get less,
indicia of privatization.
So it's in the case of NY, possibly,
if we could see the additional expense,
measuring the cost of privatization.
This is the privatization of the
National Guard.
http://goo.gl/CviNSC
Some DO get to privatize some measure of
legal process, it seems, even when
outside government.
http://www.bloomberg.com/news/2013-07-14/george-zimmerman-and-the-market...
While the economics of health (and health policy,) and economics
per se, have always been understood as to their impact on
an infinity of health related issues, now one direct connection
between undemocratic political process and one a the
methods of operation of a major disorder (autism) is identified.
http://www.futurity.org/without-these-enzymes-fear-goes-haywire/
To me ObamaCare's substantially a
privatization, even with pre-texted
Simpson Bowles cost braking.
Eliminating net neutrality is the
turning of the privatization screws.
Privatization of forests:
http://www.treebiotech2013.org/1/post/2013/05/breaking-activists-brutall...
Privatization of the food chain:
http://www.multiurl.com/la/Also_Some_Kids_Sent_Into_Inescapable_Debt_For...
Education's not privatized to a narrow group
but rather a collection of players treating
students as though they were cars on a car
dealer lot as platforms for contracting.
In that, there's also a comparison with
patients (health care.)
The measure of civic burden, being a compact
reliable thing, becomes thereby less
"dismal" as to its utility, and more scientific.
But, since it can paint a chart, and thus
a picture, of slavery, along time, is it
also history and a picture of human
indecency?
Privatization Should Only
Exist At The Sufferance Of Public Regulation.
Where The Public Exists At
The Sufferance Of The Privatizer, That's Feudal.
Demagogues' puppets are straw men for bumrapping
progressive economics.
Too many of our leaders seem unable to just
be nice happy people.
http://www.youtube.com/watch?v=O19k-YtwXTg
I agree evernewecon!
Furthermore, I say that it started with the PRIVATIZATION OF GOD, which was followed after by the PRIVATIZATION OF THE ENVIRONMENT. I regard that as a summary of the basic history of Neolithic Civilization developing systems of organized lies, operating organized robberies, with the biggest bullies' bullshit social stories about doing that becoming a series of State Religions. The currently enforced State Religion is the faith-based monetary system.
Money is measurement backed by murder. The debt controls depend upon death controls. The problem that the science of economics has is that it can not face the facts about itself. It has to be run by professional liars, and immaculate hypocrites, in order to be successful. Although it is theoretically possible to regard human civilizations as energy systems, when one actually does that it becomes obvious that governments are organized crime, effectively controlled by the best organized gangs of criminals. The methods of organized crime developed through warfare were then developed through economics.
Furthermore, when one does a more thorough study of economics, in light of the basic reality of human energy systems, it becomes clear that political economy was always inside human ecology. The central concepts of human ecology are the death controls, which were developed as murder systems through the history of warfare, that made War Kings, that founded the systems of states with sovereign powers to tax, and to kill those who resist being taxed. Upon that basis, the international banksters were able to covertly take control, by continuing to apply the methods of organized crime (such as bribery, intimidation, and assassination of politicians) while also being able to dominate the public school systems and mass media. Overall, the steady thrust of those developments has been PRIVATIZATION.
PRIVATIZATION OF GOD, AND ENVIRONMENTAL PRIVATIZATION, THROUGH A PRIVATIZED MONEY SUPPLY. Just as success in warfare was based on deceits, success in economics is based on frauds. However, our entire society is now approaching a tipping point, due to too much success at controlling everything through a fundamentally fraudulent financial accounting system. WE ARE ALMOST TOTALLY SCREWED BY THERE HAVING BEEN TOO MUCH SUCCESS THROUGH THE COMBINED MONEY/MURDER SYSTEMS, BEING ABLE TO OVERWHELMING CONTROL EVERYTHING.
The deeper challenge is to see whether or not the human experiment can survive its own excessive successes. There is an astronomically sized contradiction building between progress in basic sciences and technology, while social and political control systems operate through social pyramids based on the history of slavery, which deliberately keeps most people ignorant and afraid. Therefore, the chronic political problems inherent in the nature of life, which human animals necessarily share, are being resolved through systems such as militarism and economics, which are based on operating their death and debt controls through the maximum possible deceits and frauds. THAT PARADOX CURRENTLY LOOKS LIKE IT WILL BECOME FATAL, RATHER THAN BE FAVOURABLY RESOLVED, SINCE IT HAS TAKEN THE FORM OF A GLOBALIZED SYSTEM OF ELECTRONIC FIAT MONEY FRAUDS, BACKED BY WEAPONS OF MASS DESTRUCTION LIKE ATOMIC BOMBS.
Obviously, basic sciences have gone through a profound series of paradigm shifts. However, human sciences, such as economics, got stranded, or appear to be sinking, due to their own absurdities, because their previous successes were based on lies, backed by violence, which became systems of legalized lies, backed by legalized violence. The chronic political problems, perpetually present in human ecology, demand that there must necessarily be some murder systems, and human beings necessarily live by telling stories, which are ways that we measure the world, by separating parts, and giving those parts names and properties, which are assembled into narrative models. The human models in other sciences have made significant progress, as demonstrated by the working technologies enabled by those sciences. The science of economics has been spectacularly "successful" at doing what it was designed to do, namely operate as a social slavery system, in the shape of pyramid, that sucked all the wealth up, and pumped it to the top of that pyramid. Theoretically, we need to break through to basic paradigm shifts throughout all social science, including political science, economics, and militarism. However, all those established systems owe their degree of successful operations due to deceits and destruction, or force backed frauds, which makes paradigm breakthroughs regarding that extremely problematic, difficult and dangerous.
It is one hell of a wild ride we are on, with the human experiment entering into the phase of the successful application of scientific methods to more and more domains. However, we at stuck at the point where we are now, with the science of economics being in the same predicaments as the science of warfare. All human sciences are in desperate need of profound paradigm shifts, and the survival of the human species depends upon whether or not we will be able to complete enough of that. We have become trillions of times better at being able to lie, and back those lies up with violence, which has become our own worst problem, as the human species has thereby become its own worst enemy. THE PROBLEM WITH ECONOMICS IS THAT IT HAS BECOME TOO SUCCESSFUL AT OPERATING FINANCIAL FRAUDS!
Anyway, evernewecon, you may also look at my comment below, for more of my kind of perspective on how economics was symbolic warfare. As many of my previous comments on Zero Hedge have outlined, I have been thinking about these things for several decades, and I believe I have made some significant theoretical progress. However, at present, I see no practical point to any of that, since REALITY continues to be runaway systems of legalized lies, backed by legalized violence, wherein those operating those systems are the best at lying to everyone, including themselves, about what they are really doing. The privatization of God killed spirituality. The privatization of the environment is killing the natural world. All of the successful runaway privatization processes have become self-destructive madness!
I daydream that we may see postmodernizing science spiral around back to the ancient mysticism from whence it started. I daydream that the kinds of progress through paradigm shifts in physics and biology are possible in political sciences like economics and militarism. However, those daydreams currently appear to be nothing more than vainglorious fantasies, while, in reality, everything important is automatically getting worse, faster, as the exponential growth of the consequences of controlling civilization through force backed frauds continues to accumulate on a globalized scale!
There is no such thing as a Nobel prize in economics or economic sciences. There is, however, a Prize in Economic Sciences in Memory of Alfred Nobel that is awarded by the Royal Swedish Academy of Sciences. The prize is based on a donation from the Sveriges Riksbank (Swedish Central Bank), and has nothing to do with Alfred Nobel. (http://www.nobelprize.org/nobel_prizes/economic-sciences/)
Historically, it was the idea of the head of the Swedish Central Bank, Per Asbrink, in the 1960s to elevate economics from the status of "social science" to the, allegedly, higher status of "hard science" alongside with physics, chemistry. A manoeuvre that worked and the symbolical capital associated with the Nobel prize ended up quickly benefitting to the reputation of economics as well. And obviously, the type of neoclassical economics that dreamed of power in the 60s, and the one that we know very well how capable is to predict the future when it is actually in power a couple of decades later. (for bits of the story see: http://www.alternatives-economiques.fr/le---prix-nobel-d-economie-----un... and references therein )
And on the definition of science. Yes, being able to predict the future in a falsifiable way is the definition of science. That means you have to be able to conduct experiments to be able to separate hypothese that work well from those that don't. A thing economics is not capable of, yet.
http://www.safehaven.com/article/31717/the-ecbs-tough-balancing-act-bubbles-vs-deflation
Today, a small group of central bank chiefs can meet in private and wield unprecedented power over global markets, economies, and wealth distribution. They are held accountable to the ruling politicians that in most cases have no respect for the principle of sound money. Instead, in Europe, the UK, Japan, the US, and elsewhere, central bankers have become intricately linked to monetizing government debts, and financing the expansion of the welfare state. As such, disciplined and independent central banking, a cornerstone to any hope for sound money and credit, has been relegated to the dustbin of history.
Central banking, - ostensibly designed to combat high levels of inflation and promote economic growth, while overseeing the stability of the banking industry, has instead, morphed into technocratic planning boards that are constantly involved in rigging the value of the financial markets. Their principal modus of operandi is to encourage risk taking in the local stock markets, through massive injections of ultra-cheap liquidity. However, the result isn't better economic conditions, but rather the expansion of massive bubbles in various financial markets. In turn, central bankers have widened the wealth gap between the owners of equities, and the rest of the struggling population whose wages are sliding backwards, and is increasingly seeking out assistance through welfare programs.
Historically, the value of the stock market reflected the dynamics of the local economy, and would influence the social mood of the populace. A stock market that is booming would signal an up-and-coming economy that would be followed by increased business investment and the creation of good paying jobs. Rising share prices boost the fortunes of about 10% of households in the country, and triggers a greater propensity to spend for goods and services - otherwise known as the "trickle down" effect. Therefore, keeping a constant vigil on the behavior of the stock market, - has become the raison d'être of central banks.
In earlier times, stocks traded on the local stock exchange used to track or even anticipate the nation's business cycle. But that reliable role as a leading indicator began to seriously break down after the financial crisis of 2008. Since then, because of the hallucinogenic effects of "quantitative easing" (QE), - stock markets are no longer reflections of the health of the local economies or forecasting mechanisms of the business cycles. Instead, they are just slices of ownership in specific companies that are unreliable gauges of anything but the underlying strength of the companies they represent, their dividend payments and buybacks, and the schizophrenic mind-set of the traders who buy and sell the shares.
"Economics" is a science the way that militarism is a science. Both have their success fundamentally based upon deceits, backed by destruction, because what they both do, from an anthropological or sociological perspective, is operate organized systems of lies and robberies, inside a social pyramid system which was based on the development of slavery as its foundation. The oldest book on warfare starts by saying success depends upon deceits, and ends by saying that spies are the most important soldiers. An honest science of economics would admit those basic social facts. However, of course, the success of lies depends upon not telling people the truth.
The "economists" that have the most successful careers are the ones that covertly advance the interests of the wealthy to be able to get more wealthy. I tend to regard economics as being a science, but only in the sense that the oldest and best developed social science was warfare. Therefore, successful economics is paradoxically based upon frauds, the same as our whole financial system is fundamentally based on the fraud of the public money supply being privatized, in ways that it is made out of nothing, as debts. The "economics" that explains that is similar to the propaganda that is useful in warfare, to defeat the enemy. Economics is covertly about some men being able to get away with defrauding and robbing other men. Pretty well the whole planet has now been apparently privatized, by people making claims, and backing their claims up with violence.
It is impossible to understand private property, except as lies, backed by some system of public violence. It is impossible to scientifically understand economics other than operating within the police and military systems that back it up, because economics is fundamentally a system of social robbery, such as the current debt slavery system embodied in the basic monetary and taxation legislation. Surely, economics IS a science, the same as militarism surely IS a science. However, those are supremely paradoxical sciences, because their social success depends upon getting away with frauds and deceits, backed by force and destruction. One could say that real economics is the deeper science of lying through presenting more superficial economics. The mathematical aspects merely attempt to perfect that overall predicament.
Theoretical: Economics, the Science - "Finding the best way to distribute finite resources to satisfy unlimited wants and needs" or something like that.
Reality: Who watches the watchmen? Who chooses which economists to hire / promote? Economics, the Propaganda -
"You are too rich. We must correct this imbalance."
"I am rich. Supply and Demand Bitchez!!!! "
"Now Berkrugyellanke, rewrite that so I don't sound too enthusiastic."
Yes, it's a Science, but it's a social one. Directly linked to Politics. Both coming from Philosophy.
It isn't AN EXACT NOR LOGICAL nor PHYSICAL SCIENCE.