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Philip Pilkington: Abstraction, Language and Modelling in Economics

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By Philip Pilkington, a writer and research assistant at Kingston University in London. You can follow him on Twitter @pilkingtonphil. Cross posted from Fixing the Economists

Alciphron is the title of the book by the philosopher George Berkeley that was most popular in his own time and is probably his least popular in ours. The reason for this is because the book deals with atheism and religion and many would suppose that this has little bearing on questions unrelated.

Most of the book is rather enjoyable on its own terms. It is written in dialogue form in a prose style that is easily among the best that you will encounter among Anglo-Saxon philosophers. The Alciphron of the title is the representative of what at the time was called ‘free-thinking’ but what Berkeley renames ‘minute philosophy’ — basically, skeptical atheism, hyper-rationalism, distrust of authority in general and what would later develop into Jacobinism through the political ideas of the likes of Rousseau.

What makes the bulk of the dialogue so entertaining is the vacuity of Alciphron who is apt to use empty phrases and tautologies in place of religious ideas. In his desperation to tear himself away from the morality of the day Alciphron tries to articulate his own moral principles. But given that these are cast in a framework of skepticism he finds it increasingly difficult when pressed on it to give them grounding. Any time this point is driven home Alciphron tends to hide behind empty words like Virtue and Honour which he reflects upon in a sort of poetic and mysterious way — the typical posture of what would later become the sentimentalism of the Romantics.

All of this is interesting in its own way, but personally I have never been much taken by moral philosophy. It is in the Seventh Dialogue, however, that Berkeley sketches out some very interesting ideas on human language — something that he recognised as being an absolutely central philosophical question.

He begins with a discussion of how words stand in place of ideas like chips stand in for money-values in a card game — this is the standard conception of the day and, to a large extent, remains so today. He then goes on to show that once we have agreed upon a definition of a word it need not call to mind that definition immediately for us to communicate the idea lying behind it. Just in the same way as once we agree upon a money-value for a chip in a card game we need not call to mind the actual coins that stand behind it every time we use it. He then writes,

From hence it seems to follow that words may not be insignificant, although they should not, every time they are used, excite the ideas they signify in our minds, it being sufficient, that we have it in our power to substitute things or ideas for their signs when there is occasion. It seems also to follow, that there may be another use of words, besides that of marking and suggesting distinct ideas, to wit, the influencing our conduct and actions; which may be done either by forming rules for us to act by, or by raising certain passions, dispositions, and emotions in our minds. A discourse, therefore, that directs how to act or excites to the doing or forbearance of an action may, it seems, be useful and significant, although the words whereof it is composed should not bring each a distinct idea into our minds. (p222)

Berkeley starts from a rather nuanced conception of language. Words not only stand for ideas, they also exert influence on our behaviors and form rules by which we act. Words can also be used rhetorically to exert emotional affects.

What’s more words need not, Berkeley maintains, stand for distinct ideas. He gives the example of consciousness or the ‘I’. In truth I have no conception, no distinct idea of myself as an ‘I’ and yet the word is required to explain all sorts of things. Another example is that of the word ‘number’ as a general abstract idea — i.e. not signifying a particular number (1, 2, 3, 4, etc.).

Do but try now whether you can frame an idea of number in abstract, exclusive of all signs, words, and things numbered. I profess for my own part I cannot. (p223)

These words are abstractions. They are not representative of clear ideas but they are functional and necessary nevertheless.

Berkeley then goes on to show how numbers, for example, allow us greater ease in performing certain operations dues to their clearness of notation.

But here lies the difference: the one, who understands the notation of numbers, by means thereof is able to express briefly and distinctly all the variety and degrees of number, and to perform with ease and despatch several arithmetical operations, by the help of general rules. Of all which operations as the use in human life is very evident, so it is no less evident, that the performing them depends on the aptness of the notation… Hence the old notation by letters was more useful than words written at length: and the modern notation by figures, expressing the progression or analogy of the names by their simple places, is much preferable to that for ease and expedition, as the invention of algebraical symbols is to this, for extensive and general use. (pp304-305)

This is one of the main reasons why we use abstract language. It is not the only reason, of course, but it is a very important one. This leads people to the use of analogy and metaphor — even to the anaological or metaphorical use of models and diagrams.

We substitute things imaginable, for things intelligible, sensible things for imaginable, smaller things for those that are too great to be comprehended easily, and greater things for such as are too small to be discerned distinctly, present things for absent, permanent for perishing, and visible for invisible. Hence the use of models and diagrams. (pp232-233)

But it is all too easy, if we get too bogged down within these abstractions and forget how they are connected with the practical realities that we are actually dealing with, to begin talking nonsense and trying to solve pseudo-problems with no real meaning.

Be the science or subject what it will, whensoever men quit particulars for generalities, things concrete for abstractions, when they forsake practical views, and the useful purposes of knowledge, for barren speculation, considering means and instruments as ultimate ends, and labouring to obtain precise ideas, which they suppose indiscriminately annexed to all terms, they will be sure to embarrass themselves with difficulties and disputes. (p308)

This is where economics has erred since at least the turn of the 19th century. The early marginalists occupied two groups. One were the Walrasians who, following Leon Walras, were perfectly content to confine themselves to barren speculation of unrealistic nonsense provided it was done in a nice, formal mathematical manner. The other group were the Marshallians who tried to bring such abstract speculation down to earth. Consider the following quote from Alfred Marshall from a letter he wrote in 1906,

[I had] a growing feeling in the later years of my work at the subject that a good mathematical theorem dealing with economic hypotheses was very unlikely to be good economics: and I went more and more on the rules — (1) Use mathematics as a shorthand language, rather than an engine of inquiry. (2) Keep to them till you have done. (3) Translate into English. (4) Then illustrate by examples that are important in real life. (5) Burn the mathematics. (6) If you can’t succeed in (4), burn (3). This last I did often.

Clearly Marshall was becoming ever more concerned about the use of formal modelling in economics. He could see that it was apt to get out of hand. Marshall’s followers in this sense were, of course, Keynes and the early Post-Keynesians. But they lost the battle. By the 1950s Walrasianism was in the ascent. Even Neo-Keynesians like Solow and Samuelson displayed a penchant for abstractionism that was apt to get carried away with itself and only produce irrelevant dross.

Today the situation has become entirely absurd and nonsensical. Economists that should be trying to articulate a new way forward are, like Don Quixote battling his windmills, spending most of their time and effort trying to refute DSGE models and insisting that New Classical economics is irrelevant. This rather mundane and largely useless behavior is what is currently passing for the avante-garde of economic discourse.

This is not so much the fault of these economists as it is that they have been educated in a discipline in which, to a very large extent, this is the only discourse going. Frankly, I wouldn’t want them coming up with any ‘positive’ approaches because it is all too likely that they would end up resembling the Walrasian muck, with its groundless abstractions and useless rubbish.

Economics can only change when its object of inquiry has changed. But this cannot happen with the present practitioners because those who currently make up the bulk of the discipline are more comfortable with engineering and physics than they are with history. They are not people who can articulate themselves in a manner suited to the material that they are dealing with. And those that are suited to the material are generally driven away from economics courses because of the ridiculous formal demands placed on them by insulated and irrelevant lecturers who teach nothing but second-rate mathematics.

In this regard it is difficult to see how the discipline can change its spots. My reckoning is that the change will have to come from outside of academia. It seems to me that academic economics is only producing students whose modus operandi is in picking holes in the status quo, unable to articulate an alternative. That, to me, indicates a profession rotting from the inside out. Those who really care about how economics should be done will likely look elsewhere to learn their trade. They will be able to ironically navigate the economics classroom meanwhile learning how to really do economics elsewhere.

Addendum — Modelling as an ‘I’: I mentioned above that probably the most primitive of our abstract general ideas is that of the ‘I’. While I have no clear idea of myself as an ‘I’, I nevertheless maintain that it exists based on the fact that I have consciousness. This ‘I’ then comes to encompass my will, my experience, my opinions and so forth.

Now, it is quite obvious to anyone working in economics that economists are very testy about their models. Often one feels that when you attack a model the builder of a model will react as if you are attacking his or her person. I think that this is actually explainable if we come to understand that for many economists their model becomes a sort of stand-in or representation of their knowledge of the economy. Thus, a model becomes a sort of representation of the economist as an economist. To attack the model then becomes to attack the adequacy of the economist.

I think that this simple observation explains a lot about the weirdness you often encounter in economists when you discuss their models — or the models of their leaders that they adhere to. Because this model represents them as an economist — the ‘I-economist’, as it were — they often feel that in attacking their model you are attacking their person. This, I think, explains a great deal of anxiety you encounter among economists when you raise the issue that models might be largely useless.

Responses such as the typical “But what is YOUR alternative model” and so forth should be read in this way — i.e. as an attempt to avoid the truth-content of the statement that models might be useless and channel the discussion into a battle between models, between ‘I’s. In this way the economist seeks to neutralise the statement that might undermine them as an ‘I-economist’ and instead tries to re-frame the debate in such a way that the ‘I-economist’ is maintained and the conversation becomes simply a fight between such ‘I-economists’.

This also goes a long way to explaining why, as some feminist economists have noted, modelling tends to be a male practice. Males in contemporary society have a far greater need to assert themselves as static ‘Is’ than females. An attack on models can easily be taken as an attack on one’s masculinity while, more radical still, an attack on modelling in general can be taken as an attack on contemporary representations of masculinity. While I am not generally inclined to explain intellectual constructions in such a manner I believe that this is indeed of relevance here.

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  1. allcoppedout

    Interesting use of Berkeley. A more modern approach might be through Dan Sperber and ‘argumentative theory’. I don’t see much of a gender issue and think the problem is more about our very limited understanding of argument, taking up those easy to ‘win’ with easily accessible ‘evidence’. There is a tendency to use terms like ‘growth’ whilst burying such as most growth being differentiated with a complex of stages. Economics has a peculiar way of taking everything else as stable outside the variables in models. Apparently sophisticated stochastic models are often simplistic abstractions assuming, say (and often), Brownian motion is like the economic situation. The subject is essentially positivist in taking a false lay conception of science. I’d go as far as to say the “gender issue” arises because many equally powerful (or useless) economic arguments can be made, leaving only rhetorical tricks to win out (the Greeks knew this). Women are as good at this as men.

    Economic argument is often presented to political buffoons. This should be in our models. Not enough money to gamble away in London? Replace your crofters (after paying politicians and lawyers to steal their land) with more economic sheep. This can be modelled by leaving out the murders, corruption (other than as bribe costs) and hardships of others. Simples! Ignore private debt because it zeroes out in double entry book-keeping. Simples! Leave out of such models that you have the brain of a meercat.

    I tend to think gender and other terms of political correctness like “institutional racism” are blinds for incompetence. Sperber has it we fail to make the best arguments a lot of the time. Look at the simplistic, biased tripe of pundits like Stephanie Flanders (now bag-lady for JPM), Robert Peston (cast of dozens) passed-off as economics, but also paradigmatic factionalism and vanity publishing in the academy. The aim is surely to prevent inclusive argumentative situations. Add 2 minutes of Steve Keen for “balance”. Last night, Newsnight “explained” that inflation is not the same for everyone, failing to note none of the rich is going under-nourished or without a roof over their heads. Good grief!

    Sperber has some suggestions on how we might make the best arguments and spot when we are just using easy ones and rhetoric (confusing evidence with what goes as taken for granted by audience segments). I’ve found people very resistant to these ideas. Could this be because we are too proud to recognise our incompetence in making the best arguments?

    Anyone interested in the start of Philip’s piece could start here on more modern work:

    Polemic disguised behind the “objective voice” is common in all genders and many situations we pretend are rational (courtrooms and scientific write-ups are obvious examples). We might try honesty to break through the restrictions of mannered society (Norbert Elias).

  2. Hugh

    I do not see it so much as a problem of language but more a lack of recognition of philosophical foundations. All economics tends to view itself as primarily descriptive. Even MMT does this. But the description, the models, occur within a philosophical context, a series of suppositions about who we are, what we want, and how we act, not just as individuals but as societies. The charlatanism of modern economics stems from the equation of what we want as a society with the summation of our individual wants and acts. Modern economics, in other words, has unlearned something the Greeks knew about more than two thousand years ago. Aristotle called it πολιτκη. We do not act simply as individuals but also as members of society. Modern economists fail or refuse to take into account this social component. This is a fatal flaw in their theories. Leaving out the social purposes of the economy allows for any level of inequality and concentration of wealth. You can decide for yourselves whether this omission is deliberate or not.

    Neoclassical economics goes further by treating us as rational, autonomous, interchangeable individuals/agents who actually know what we want. We are, of course, none of these things, or them only incompletely, most of the time. So any model based on such conceptions is not going to simplify reality but grossly distort it beyond all recognition.

    1. Banger

      Except in very narrow settings Economics as a field of study is interesting garbage. This is not because practitioners are stupid but because, as you rightly say, they ignore society, morality, and, above all, politics. Economic situations are the result of political decisions not “economic” decisions. The political structure sets up the game with rules, consequences and rewards and within those confines what economists talk about may make some sense–but once the rules (these are not written rules but realpolitik structures) change then the whole edifice breaks down and, because politics is usually fluid, the rules change all the time.

      1. j gibbs

        All you have to do to return economics to reality is recognize the genius of Veblen. All books apart from his should be burned. Keynes too, although I would miss his flair for language. On the other hand, don’t burn the Treatise on Probability. I forget the exact name.

    2. Calgacus

      Modern economists fail or refuse to take into account this social component. This is a fatal flaw in their theories. Leaving out the social purposes of the economy allows for any level of inequality and concentration of wealth.

      Basically all work in any field aims at being primarily descriptive – always “fails” – but what is closer to success than failure? Good economists, MMT don’t “leave out social purpose”. (Base) money is an accounting of (social) debt toward a member of society, awarded for advancement of social purpose. Same for private monies (“credit”) and private purpose. This in mind, we can see that we are not merely “allow[ing] ..for any level of inequality and concentration of wealth.” Inequality and concentration of wealth are our primary social purpose. High time for that to change, methinks, and noticing this really existing, really active social purpose is a most important step.

      1. mansoor h. khan

        Calgacus said:

        “Same for private monies (“credit”) and private purpose”

        The lure of interest income from usury is so powerful that the elite love our money system. It places money and the power that it confers at the center of life and turns this tool called “money” into a a god.

        I agree with F. Beard. Our money system concentrates wealth far more than it would be if money was government issued rather than privately issued.

        Mansoor H. Khan

  3. craazyman

    boy this should be a thread for thoughts as deep as the bottom of the sea.

    but no intellectual shipwrecks please! Haven’t we had enough of those by now? We’re not scuba divers & we don’t want to have the get out the dredging crane, or whatever they use to haul up shipwrecks. We’re philosophers, dammit and we lay around and think. Other people do the sweating and the heavy lifting!

    I have lots of deep thoughts but sadly have to work, since I’m not getting rich quick in the market. What use is economics if the models can’t get you rich (unless you spout them working for a too-big-to-fail beta leveraging enterprise)? That is not my situation, so it’s back to the desk for me.

    1. craazyman

      It just occurred to me the sea isn’t the only thing that’s deep, it occurred to me the universe is too deep to be modeled. It already occurred to me that the models don’t describe the reality, since the reality is too deep to be described, but they create reality, since human affairs organize themselves to take advantage of the structures of thought the models present to the world. And then it occurred to me the poet Wallace Stevens said the same thing in the first two stanzas of Man with a Blue Guitar

      The man bent over his guitar,
      A shearsman of sorts. The day was green.

      They said, “You have a blue guitar,
      You do not play things as they are.”

      The man replied, “Things as they are
      Are changed upon the blue guitar.”

      And they said then, “But play, you must,
      A tune beyond us, yet ourselves,

      A tune upon the blue guitar
      Of things exactly as they are.”


      I cannot bring a world quite round,
      Although I patch it as I can.

      I sing a hero’s head, large eye
      And bearded bronze, but not a man,

      Although I patch him as I can
      And reach through him almost to man.

      If to serenade almost to man
      Is to miss, by that, things as they are,

      Say it is the serenade
      Of a man that plays a blue guitar.

      * * *
      However he was much higher-minded than economics models, since you can look at a man and look at your model and see the differences and similarities and then you think. You don’t just say “OK I’m done.”

      Faaak these are deep thoughts. You need an air tank and flippers just to examine them.
      You can even see fish! ahhahahah

  4. Knut

    Nice essay. Good to see Bishop Berkeley here for a change. As to the matter at hand, I think it is unlikely that we will see a change in academiceconomics in any of our lifetimes. It is like scholastic philosophy, which stayed on life support at the Sorbonne almost to the Revolution. There are a lot of reasons for this which you lay out in the essay and don’t need repeating. But there is also the institutional fact that young academics must publish or perish. This demand from university administrators and their peers has given rise to a proliferation of specialized journals and ‘invisible colleges’ filled with self-referential members. Economics is synthetic more than it is analytic. Any real situation that we want to understand is going to have a lot of causes, and although as Marshall pointed out, it helps to isolate the causes one by one, in the end you have to put them back together. The institutional pressure to publish or perish works against this. A young person is more likely to keep his or her job by staying inside the self-referential circle. Hardly anyone on tenure committees nowaday actually reads and assesses the work of their young colleague; they look to the opinions of that colleagues’ invisible college.

    The point I am trying to make is that there is no intellectual centre in economics anymore. The whole operation is just a machine for getting promoted. I make a huge exception for Thomas Piketty abd Edward Saez, who seem successfully to have bucked the tide.

  5. Bruce Johnson

    Thank you for posting a philosophical explanation of why attempt to tilt at the windmills of any interdisciplinary field are construed as attacks on the persons holding these oversimplifications as absolutes.
    Our bounded rationality in modeling any non-stationary random process, from the origins of the universe to economics to the fluid mechanics of wave and weather predictions and resulting ship motions (my discipline) all suffer from these oversimplifications. It is most apparent in hand or computer drawn cartoon graphics (supply-demand curves, for example) and in using probabilities based on the stationary random process and independent trials assumptions. It also shows up in international banking and maritime regulations written by the politically savy technical community who are interested is what will achieve a majority vote rather than seriously modeling how the world behaves. Perhaps the latter is nearly impossible because of our bounded rationality.

  6. Banger

    Interesting essay–not sure I understand it that well but I’d like to comment, since this was mentioned on the word “I” or what we call the self. First, many of the problems we have in our society not just in the social/political structures we live in but in our ability to comprehend the world around us is that we are obsessed with specialization. To me, it is obvious that Economics, as a field, is a part of politics–all economic situations are a result of political situation. If you ignore the political situation you cannot understand economics at all.

    I was talking to a psychotherapist and mentioned some interesting connection between some new ideas about evolutionary biology and the increase of autism. He was going to take some notes on what I was talking about but realized that he didn’t have time to either continue the conversation or take the time to look into that field because he is continually pressured to take specialized training to keep up his credentials (the state here requires all kinds of expensive training) and deal with his paperwork and all kinds of things that have nothing to do with healing his clients–and he’s unusual because he’s actually interested in a broad spectrum of ideas. Most specialists just keep their nose to the grindstone and stifle their imaginations because even if they pursued interests outside their fields they will end up being penalized or ostracized.

    So the self or “I” needs to be looked at as a philosophical and practical level and that needs to be connected with our personal life, our community life, culture in general and so on. Mysticism is one thing that is part of the whole–in my view, we ignore to our peril. We cannot separate mysticism from philosophy, religion, sociology, physics, psychology, politics and on and on. It’s all one subject. The essence of mysticism is the problem of the self vs the Self. According to all the teachings I know they all come down to the fact that we are all the same Self as in the idea in the Vedic/Yogic tradition that the larger Self is the same as Brahman (the creator God). This is true in the OT where Moses asks God what he can be called and he is answered “I am that i am.” In practice all meditative practices are based on that idea. The self, as an existential reality, is the point of consciousness wherein we observe not just the world around us but the thoughts that cross our minds. The “I” we usually think about is a series of “I”s that are the sum total of all our conditioning from parental to societal interactions–when you strip that away then you have the witness and the witness, according to the accounts of many meditators and mystics (including myself) is a very deep and spacious place. That deeper “I” is, to me, the most precious part of our lives. We reach that when we can approach what Maslow called “peak experiences” and the role of society is to encourage just that and the role of politics and economics is to create social structures that create a convivial society to give “room” for people to have these peak experiences which is all about being centered into the Self or the divine part of us.

    1. mansoor h. khan

      banger said:

      “Self or the divine part of us”

      I will say the same thing that banger said in a dumb down politically incorrect language:

      We need to become more god serving and not just self serving

      Mansoor H. Khan

  7. Andrea

    Economics should be part of Social Anthropology (with a good dose of Semiotics.) ..but who am I?

    Economics on the whole is beleaguered with founding principles (take your pick), calculations, models, conjecture presented as constants, BS rules, and so on.

    It has nothing much to do with abstract / concrete, that is a red herring. Language, or the ‘mental concept’ tagged, covers pretty much all human signifying, be it descriptive, speculative, theoretical – it is always ‘abstract’, built on human cognition and categorization of the world and the concepts, built up over time, current in X society.

    (E.g. ‘apple’ is concrete but ‘fruit’ is abstract; ‘hard’ is concrete but ‘atom’ is abstract…heh what?)

    So-called ‘Economic Science’ attempts to reify some particular view(s) of human transactions, society and more (too often neglecting the ‘real, concrete’, material world such as the growth of apples, peak oil, winds..) and so resembles prescriptive, top-down, authority – religion, ideologies, political propaganda, philosophy, aka meta-physics, with the attendant decrees by the Queen, declarations and ‘rules’ from the Big Banker, Laws signed by the PTB, etc. legitimized by Economist’s dogma.

    Descriptions or ‘theory’ are fanciful, tortuous, are in the main produced to favor, encourage, rubber-stamp, etc. xyz actions. Making economists the no. 1. stooges and performing clowns, handsomely paid in the main, for those in power at some time, place.

  8. keynesian

    I have been reading Philip Pilkington’s blog articles on Berkeley and he stimulated my interest in Berkeley so I have been re-reading Frederick Copleston’s seventeen volume “A History of Philosophy” on Berkeley, Hume, Locke, Hobbes, Rousseau, and this week Kant. It’s amazing how much Libertarians hack up Locke and Rousseau. They borrow from Rousseau’s anti-government views, social contract theory, self-love ethics, but leave out his polemic against private property as the corrupter of the human spirit and his graduated tax policy for the wealthy. They interpret Rousseau as a kind of Libertarian car dealer. Anyway, thanks to Pilkington for getting me out of my “dogmatic slumber. “

  9. Bruce Wilder

    The prevalence of solipsistic skepticism in economics might be related to the I-economist modeling practice.

  10. Jim

    Philip you write: “While I have no clear idea of myself as I. I nevertheless maintain that it exists based on the fact that I have consciousness. This “I” then comes to encompass my will, my experience, my opinions and so forth.”

    What you seem to be doing here is normatively embracing the concept of self and are therefore able to stipulatively, descriptively define it.

    This fits nicely into a perspective which argues that we need to postulate an irreducibly normative dimension in even our most determinedly descriptive statements.

  11. allcoppedout

    Encouraging article and comments. Most undergraduates are surprised to learn equally powerful arguments can be made on almost anything even though this is summarised as long ago as Sextus Empiricus. Part of this surprise is that people can think and argue so differently, making one wonder what our schools teach. My own specialist subject (organisational studies) can be taught on several root materials from American pop-psychology (mainstream) to deconstructive philosophy, critical psychology and critical theory. A classic text doing an encyclopaedic job on this was Burrell & Morgan’s ‘Sociological Paradigms and Organisational Analysis’ (1979). I mention this only to reinforce what Knut says above. We have been influencing almost no one and hidden any light under the bushel of wordy prose useless in job interviews. It’s a bit like teaching real history to people whose job options are restricted to being royal footmen.

    Even older philosophy recognises criticism can be analytic or immanent. In the first we might, say, apply marxist epistemology to work practices, challenging from different theoretical rules. In the latter we use the system’s own theoretical assumptions to find, say, logical inconsistencies. Sadly, if you are marxist it’s easy to trash capitalism, if capitalist to trash marxism. This is almost the ground of Israeli-Palestinian dialogues of the deaf.

    In practice I don’t think our thought experiments are daring enough. We do stuff like who would you throw out of the balloon first, but should be thinking about what would happen if we killed the 100,000 most rich people and redistributed wealth beyond global gdp. Compare this with killing 100,000 surgeons. Given a forced choice, which would you choose? The point, of course, is to establish what we think the effects of such would be, not to kill anyone. What, for instance, would a political system be that allowed us to sequestrate the rich? Do we have an actual world that allows them to sequestrate the rest of us? What instruments of torture prevent us asking such questions? Remember you could once face a tour of such instruments for suggesting the earth travels round the sun.

    I suspect much philosophy and apparent academic minority reports are actually a form of quiescence. I can’t even vote for the right to die with dignity when the time comes. Seeing my town centre more or less derelict, I’m asked what I love about it by a PR firm hired by the Council. I have such perks as being able to go for a lap dance and late drink in a run down bar, gamble, eat 57 varieties of bad fat-food and be mugged if I stray 20 yards from the taxi that gets me to this paradise, but no option to work in a cooperative with minimal hierarchy and pay differentials unless I start my own.

  12. Fiver

    If you dump on, as oppose to critique, the work of a female ‘marginal’ economist, or for that matter, any male or female with any real engagement in their work, whatever that work might be, you are not going to be appreciated. Repetition has its own perils.

    I liked Berkeley too, though my professors did not. I like that he took solipsism seriously, seriously enough to make it the void with which he proves God’s existence, and our existence in God. Not bad.

    The question is, supposing the economists using their mainstream economics were honest, decent human beings, and all wanted full employment and a whole range of other societal goods including education, broad citizen and human rights, working legal system, pensions – all those things a liberal may want. Can they not make their gizmos work well enough to get there, if they want to? Honest men and women, they are. They couldn’t save half the budget by downsizing the military down to the size needed, nor more than 10% of what it’s got, this an other things. Is it impossible for them to do good if they try? Would they follow orders if someone said “spend more”? What would their best case look like in the US, assuming all involved wanted to do what you yourself would want done that is best for the US and its people. And start on a level playing field, not in this mammoth hole created by —- was it the economics they had wrong since the ’60′s, or was it the incredibly low bar with respect to the calibre/integrity/values of the entire ruling class that had by then already chosen a course of Empire and endless war?

  13. JohnB

    This debate over models confuses me – what is your opinion of Steve Keen’s attempt to apply macroeconomic accounting models, using his Minsky program?

    I agree that a model can never fully accurately describe the real world, much like a weather modelling system can’t, but it can be used to provide limited descriptions of what is happening, and very short-term limited predictions – within a certain degree of probability.

    Also: Doesn’t macroeconomic accounting, and the very fact that your Assets – Liabilities must sum to 0 – doesn’t that mandatorily imply, that you need to model at least this much to have any accurate description of the macroeconomy? (i.e. doesn’t that fact, actually itself impose a minimum amount of modelling that you need to adhere to – regardless of whether you want to avoid modelling or not?)

    I would be interested in a future post, giving a succinct explanation of the issues with modelling, and seeing if that posts critiques apply particularly to what Steve Keen is doing – his work gives me the impression that there’s a lot of potential benefit from modelling, and I’d also be pretty interested in his response to such a critique.

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