Economics is pseudo-science

book smarts · 08-12-2008 10:19PM

Flamed Diving wrote: »

Interesting. Could you give me an example of a scientific theory that has been proven?

Depends on your definition of proven, I guess. If you want to go down the road of philiosophical nitpicking you can say nothing is provable. But that is pointless so lets stay in the real world please and leave that to Socrates. Science is constantly refining itself.

book smarts · 08-12-2008 10:20PM

nesf wrote: »

*cough*

String Theory

*cough*

Oh Jesus.

nesf · 08-12-2008 10:23PM

book smarts wrote: »

Oh Jesus.

Well it's an example of near religious devotion to an unsupported proposition in what many would consider to be the most rigorous and precise of the sciences.

book smarts wrote: »

Depends on your definition of proven, I guess. If you want to go down the road of philiosophical nitpicking you can say nothing is provable. But that is pointless so lets stay in the real world please and leave that to Socrates. Science is constantly refining itself.

But science and our pursuit of it is intrinsically about what we consider to be "proven". Dismissing it as a purely philosophical matter misses the point. Actually, in a thread about what is and what is not a psudo-science I would think it's extremely relevant to the discussion. One of the most difficult things for me was going from Physics to Economics, the nature of the latter doesn't allow the careful repetition of experiments that gives the former its precision and accuracy in predictions.

Flamed Diving · 08-12-2008 10:38PM

book smarts wrote: »

Depends on your definition of proven, I guess. If you want to go down the road of philiosophical nitpicking you can say nothing is provable. But that is pointless so lets stay in the real world please and leave that to Socrates. Science is constantly refining itself.

So no scientific theory has been proven then. Good.

08-12-2008 10:48PM

http://www.tcd.ie/Economics/SER/pasti.php?author=&title=&section=Econometrics%3A+Theory+and+Practice&search=Search

You can find essays of students on this exact topic in the above link. Most should be accesbile to non practioners of economics.

You can also see examples of econometrics being used to 'prove' theories.

babytooth · 08-12-2008 11:41PM

asdasd wrote: »

Im pretty ace at maths. The simple equations of economics are hardly even hard sums.

Yet economics is still bollocks. It lacks predictive power. We may as well ask an astrologer to predict the next recession.

LOL....

if its not hard, try building an econometric model to predict the future!!!....

economics is about common sense. Try and model the evoloution of dna strands in real time....can't be done, don't be a silly man

Flamed Diving · 08-12-2008 11:49PM

babytooth wrote: »

LOL....

if its not hard, try building an econometric model to predict the future!!!....

economics is about common sense. Try and model the evoloution of dna strands in real time....can't be done, don't be a silly man

Don't feed the pwned.

SkepticOne · 09-12-2008 12:02AM

The question of the predictive power of economics is very important in the current times, I think most will agree.

A comparison was made earlier between economics and physics but I think the way they should be compared is the degree to which they succeed in the applications to which they are put. So, for example in the case of physics, is it possible to know in advance how a plane will fly based on our current understanding of aerodynamics? The answer is for the most part, yes. In the case of economics, a typical question might be "will Gordon Brown's proposed stimulus package work?" We are not looking for perfection in either case but rather a "good enough" answer for our purposes, so a much higher degree of uncertainty would be acceptable in the case of economics as compared to aerodynamics.

Although I have a lay interest in economics one of the things I think that suggests that economics lacks predictive power is that whenever something major is going to happen, only a minority of economists that make predictions in that area seem to have predicted it. Why is this? Can we have any confidence in the predictions of an individual economist? Does economics only give the illusion of understanding something in the real world?

Akrasia · 09-12-2008 10:23AM

Économiste Monétaire wrote: »

Sure. Assuming you have some knowledge of a basic input output model, and transposing it to 'Marxian values', I'll skip an example.

Marx wrote the rate of profit as S/(C+V); with S being surplus (what the capitalist receives after paying workers V), V being the variable capital used in production, and C being the constant capital used. Dividing everything by V we get: (S/V)/[(C/V)+(V/V)] = (S/V)/[(C/V) + 1]

The organic composition of capital is the ratio between C and V, C/V. He argued that this would increase over time, and that if the rate of exploitation being S/V would remain constant, the rate of profit must fall. He projected that there would be downward pressure on wages and that because the rate of profit would fall over time, eventually the capitalist system would collapse because the marginal returns for the capitalists would be lower than the cost. They would stop investing in the economy and the ability for the capitalist economy to have another 'revolution' would cease.

But, if C/V were to rise, it means that productivity must rise, leading to an increase in the standard of living which is against his idea that the standard of living would fall. For capitalists to keep the same rate of profit they would need to increase exploitation (S/V) to match the increasing capital deepening, which he was wary of. There's a fairly large amount of literature about whether he was right or wrong in his assertions; I follow the view that he was wrong, but I'm no expert on Marxian economics.

There is more worker exploitation in todays economy than there ever was, the difference is that its more global than ever, the domestic workers may have seen their conditions improve slightly (through hard fought battles for labour rights) but the exploitation has merely moved overseas where slave labour conditions are still widespread.

For two reasons, it shows Marx in some form of praise for capitalism, and it's a beautifully constructed piece of literature.[/QUOTE]

Flamed Diving · 09-12-2008 10:25AM

Akrasia wrote: »

There is more worker exploitation in todays economy than there ever was, the difference is that its more global than ever, the domestic workers may have seen their conditions improve slightly (through hard fought battles for labour rights) but the exploitation has merely moved overseas where slave labour conditions are still widespread.

For two reasons, it shows Marx in some form of praise for capitalism, and it's a beautifully constructed piece of literature.

Slightly?

I think the word you are looking for, is massively.

Massively.

asdasd · 09-12-2008 11:15AM

Don't feed the pwned.

Um. Claiming "pwnage" is not the same as actually being owned. I claimed that proper science had been proven except for known unknowns ( like the unified theory).

You claimed that that meant that no science was a proper science. The best I can explain there is that you didnt really read what I said, or you dont understand exceptions.

Then you put Pwned in big letters, and a different colour font.

Much of the other arguments on this thread are in fact similar to arguments for intelligent design. We can't really know stuff. Nothing has really been proven. There are holes in your stinking newtonian mathematics too ( or evolutionary theory). So no scientific theory has been proven then, good?

I could not be assed.

I will say that newtonian physics can tell me what happens when a ball is shot from a cannon. Economics cant tell me when the big old Depression is coming. intelligent designers are not very good at explaining why God is playing silly buggers with fossils, or who created god himself.

But sure nothing is really known is it?

Can we all agree that economics is not really as exact a science as physics? Let me put that out there and retreat from the thread.

Économiste Monétaire · 09-12-2008 12:37PM

Akrasia wrote: »

There is more worker exploitation in todays economy than there ever was, the difference is that its more global than ever, the domestic workers may have seen their conditions improve slightly (through hard fought battles for labour rights) but the exploitation has merely moved overseas where slave labour conditions are still widespread.

You're replying to a point I never made. I'm talking about Marxian values, Marxian idea of what exploitation is, and in countries that Marx used as his guinea pigs (the U.K.). Also, as Flamed Diving already stated, saying that standards of living for workers has only increased slightly, since the 1860s/70s, is an incredible understatement. I was not discussing your perception (or mine) of what exploitation is, or isn't, in the wider world.

DJDC · 09-12-2008 01:34PM

As someone with an engineering background now doing a finance postgrad, I have been surprised to find that advanced economics is certainly not mathemathically trivial e.g CAPM....both in terms of actual knowledge required and also in terms of visualisation. Whether the theories and models actually hold any real predictive power is another arguement and something which most economists would agree with.

In a more light-hearted mood...

Economist poem
If you do some acrobatics
with a little mathematics
it will take you far along.
If your idea's not defensible
don't make it comprehensible
or folks will find you out,
and your work will draw attention
if you only fail to mention
what the whole thing is about.

Your must talk of GNP
and of elasticity
of rates of substitution
and undeterminate solution
and oligonopopsony.

Kenneth E. BOULDING

Q. What do economists and computers have in common ??
A. You need to punch information into both of them.

Why does Treasury only have 10 minutes for morning tea ??
A. If they had any longer, they would need to re-train all the economists.

Two economists were walking down the street when they noticed two women yelling across the street at each other from their apartment windows.
Of course they will never come to agreement, stated the first economist.

And why is that, inquired his companion,

Why, of course, because they are arguing from different premises.

Here's couple of more general jokes.
A civil engineer, a chemist and an economist are traveling in the countryside. Weary, they stop at a small country inn. "I only have two rooms, so one of you will have to sleep in the barn," the innkeeper says. The civil engineer volunteers to sleep in the barn, goes outside, and the others go to bed. In a short time they're awakened by a knock. It's the engineer, who says, "There's a cow in that barn. I'm a Hindu, and it would offend my beliefs to sleep next to a sacred animal." The chemist says that, OK, he'll sleep in the barn. The others go back to bed, but soon are awakened by another knock. It's the chemist who says, "There's a pig in that barn. I'm Jewish, and cannot sleep next to an unclean animal." So the economist is sent to the barn. It's getting late, the others are very tired and soon fall asleep. But they're awakened by an even louder knocking. They open the door and are surprised by what they see: It's the cow and the pig!

Three economists and three mathematicians were going for a trip by train. Before the journey, the mathematicians bought 3 tickets but economists only bought one. The mathematicians were glad their stupid colleagues were going to pay a fine. However, when the conductor was approaching their compartment, all three economists went to the nearest toilet. The conductor, noticing that somebody was in the toilet, knocked on the door. In reply he saw a hand with one ticket. He checked it and the economists saved 2/3 of the ticket price.
The next day, the mathematicians decided to use the same strategy- they bought only one ticket, but economists did not buy tickets at all! When the mathematicians saw the conductor, they hid in the toilet, and when they heard knocking they handed in the ticket. They did not get it back.
Why? The economists took it and went to the other toilet.

A party of economists was climbing in the Alps . After several hours they became hopelessly lost. One of them studied the map for some time, turning it up and down, sighting on distant landmarks, consulting his compass, and finally the sun.
Finally he said, ' OK see that big mountain over there?'
'Yes', answered the others eagerly.
'Well, according to the map, we're standing on top of it.'

nesf · 09-12-2008 03:40PM

asdasd wrote: »

I will say that newtonian physics can tell me what happens when a ball is shot from a cannon. Economics cant tell me when the big old Depression is coming.

If you think that those two problems are similarly difficult to solve then you understand very little about Newtonian physics and even less about Economics.

babytooth · 09-12-2008 03:46PM

From a philosopical sense, nothing is correct.

The only valid statement anyone can made about a theory, or a scientific fact or so on, is that, in so far as we know, we haven't been able to prove it wrong.

Something is as accurate as its attempts to disprove it suggest.

And thats about the sum of it, nothing more, nothing less.....

Economics is pseudo-science

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