Economics as a Science - A Discussion

Economics is what Physics would be if you couldn't "exactly" measure all the quantities involved or if particles could hide their true velocity or position from you. Economics suffers from a critical measurement problem that limits its ability to be highly accurate.

But Science isn't about accuracy of predictions as much as it is about gleaning accurate information on how systems in nature work, and in the latter there have been excellent advances made in Economics over the past 50 years on human behaviour in markets of all shapes and sizes.

Deleted User wrote: »

I know what it is, I've published on it.
I'm just wondering what exactly you meant by that.

Care to flesh it out? Honest question - you've been quite vocal before on this topic. I'm interested to hear your thoughts.

Mean by what?

Vocal on what?

You must be more specific, but if you mean economics it appears by the comments of senior posters on here that it is OK for some of the best known practitioners of the art (Dan MacLoughlin for one) to dissimulate, to encourage fools and reward cynics, if that is so, then Economics cannot aspire even to be a belief system never mind a science it is instead a collection of jargon like art criticism.

redarmyblues wrote: »

I do not to belittle all the contributions on this forum far from it I frequently drop in to read commentary and discussion on financial conventions and there are some contributors on here who are very good indeed (you know who they are), but even those posters have refrained from using the available scientific method to prove the hypothesis and thus undermine the claims of Economics to Science.

It depends on what you mean by science. If science for you means hard empirical facts that can be reproduced at will anywhere in the world then you're going to just about manage to get to Biology before you definition wears out (and even then some areas of biology will stump it because of measurement issues).


The core issue is this, in some fields you can't directly and independently take measurements. By measuring or taking observations you can change the results and it's not possible to see this "mechanism" that changes things. In physics we can hook up a voltmeter to a battery and read its voltage off of it and can reproduce this phenomenon anywhere. In Economics, Metereology, Psychology, Medicine, some areas of Biology and so on, you can't always run experiments like this. For doctors trying to predict the chance of a flu pandemic (to take a topical example) they have to use historical data (imperfectly gathered not for the present use) and try to extrapolate what would happen if X strain gets more virulent. They can't do this with any serious degree of accuracy, see Bird Flu and Swine Flu for details, all we can say with any certainty is that at some point there will be another pandemic but we can't tell you where and when it will start other than we've an inkling that it might gestate in South East Asia (i.e. not were Swine Flu started!).

The scientific method is a lovely philosophical tool and in situations where it can be applied to its fullest extent an extremely powerful one but when what you're studying can't be "replayed" exactly in another location then it we're in a much murkier world. I'm not arguing that Economics is as, or more, "scientific" than medicine, it isn't but if you look at Psychiatry then you'll start to see where parts of Medicine become more and more like the kind of murkiness that we'd normally associate with psychology or economics.


There is also a crucial distinction to be made here, some areas of economics are a lot more "scientific" than others. Some of it is purely empirically based, other parts of it are almost completely theoretical and axiomatic. You can't really discuss whether Economics is a Science because it's such a broad church. I'd find it extremely tough to not call what "Experimental Economists" do not science, because what they do is construct and experiments and run them (using people and so on, google it if you're curious about what they do). I'd conversely find it extremely difficult to call some of the more axiomatic theoretical branches of the discipline scientific because they don't involve any empirical study (and I don't think you can do any science without some empirical grounding for it) e.g. some of the neo-classical work done during the 70s and so on with the efficient market hypothesis and other nonsense.


Edit:

I probably should make some actual point on the question of whether Economics is a Science or not. Basically, it doesn't really matter all that much. Science is a broad church and can include or not include many different fields depending on how tight you make your definitions and cut-off points. Personally I think it's a waste of time really to argue about this to any length: you can conjure one set of definitions to make Economics a science and another set to make it not one. This can be done for almost all the social sciences and most of us draw the line at different points. At the end of the day where you draw this line shouldn't affect your view on the individual pieces of research that make up the subject, each of these should be critically evaluated on their own depending on the empirical and theoretical underpinnings of each of them.

Fascinating discussion.

Before reading it, I would have been of the opinion that Economics is not a science due to the difficulty with repeating conditions for experiments and the hindrance this will cause to the scientific method. However, the comparisons with the accepted sciences of meteorology and aspects of biology put that assertion on shaky ground ...

Perhaps a different but related question is relevant: a necessary component of science is advancement - all sciences strive to develop and improve theories, abandoning those theories that have been disproven and replacing them with new theories not yet disproven (but disprovable).

Advancements in physics put a man on the moon. Advancements in biology gave us vaccination. Have there been comparable advancements in Ecomomics? Has Economics abandoned "old" theories that have been shown to be proved wrong?

No references, I'm afraid - just my thoughts.

nesf wrote: »

It depends on what you mean by science. If science for you means hard empirical facts that can be reproduced at will anywhere in the world then you're going to just about manage to get to Biology before you definition wears out (and even then some areas of biology will stump it because of measurement issues).


The core issue is this, in some fields you can't directly and independently take measurements. By measuring or taking observations you can change the results and it's not possible to see this "mechanism" that changes things. In physics we can hook up a voltmeter to a battery and read its voltage off of it and can reproduce this phenomenon anywhere. In Economics, Metereology, Psychology, Medicine, some areas of Biology and so on, you can't always run experiments like this. For doctors trying to predict the chance of a flu pandemic (to take a topical example) they have to use historical data (imperfectly gathered not for the present use) and try to extrapolate what would happen if X strain gets more virulent. They can't do this with any serious degree of accuracy, see Bird Flu and Swine Flu for details, all we can say with any certainty is that at some point there will be another pandemic but we can't tell you where and when it will start other than we've an inkling that it might gestate in South East Asia (i.e. not were Swine Flu started!).

The scientific method is a lovely philosophical tool and in situations where it can be applied to its fullest extent an extremely powerful one but when what you're studying can't be "replayed" exactly in another location then it we're in a much murkier world. I'm not arguing that Economics is as, or more, "scientific" than medicine, it isn't but if you look at Psychiatry then you'll start to see where parts of Medicine become more and more like the kind of murkiness that we'd normally associate with psychology or economics.


There is also a crucial distinction to be made here, some areas of economics are a lot more "scientific" than others. Some of it is purely empirically based, other parts of it are almost completely theoretical and axiomatic. You can't really discuss whether Economics is a Science because it's such a broad church. I'd find it extremely tough to not call what "Experimental Economists" do not science, because what they do is construct and experiments and run them (using people and so on, google it if you're curious about what they do). I'd conversely find it extremely difficult to call some of the more axiomatic theoretical branches of the discipline scientific because they don't involve any empirical study (and I don't think you can do any science without some empirical grounding for it) e.g. some of the neo-classical work done during the 70s and so on with the efficient market hypothesis and other nonsense.


Edit:

I probably should make some actual point on the question of whether Economics is a Science or not. Basically, it doesn't really matter all that much. Science is a broad church and can include or not include many different fields depending on how tight you make your definitions and cut-off points. Personally I think it's a waste of time really to argue about this to any length: you can conjure one set of definitions to make Economics a science and another set to make it not one. This can be done for almost all the social sciences and most of us draw the line at different points. At the end of the day where you draw this line shouldn't affect your view on the individual pieces of research that make up the subject, each of these should be critically evaluated on their own depending on the empirical and theoretical underpinnings of each of them.

The distinction is ,does the discipline result in a tangible improvement. Adavances in Biology, Physics, Chemistry make possible, organ tranpslants, nuclear power, drug synthesis. if there has being any breakthroughs in Economics they have have not altered the age old boom and bust cycle in human affairs, in fact Biology has more to say about economics than Economics as it avoids the ideological bias of the latter as it prefers to measure populations rather than control them.

Sorry I had not read robertMcGrath (above) when I posted, who anticipated what I had to say so excuse the duplication.

Joe1919 wrote: »

One difference and difficulty (imo) that economics ( and social science) faces compared to say biology is that the economy and its structures, (which also consists of people as producers and consumers) keeps evolving and changing.
A theory that worked in the past may no longer work due to these changes.

This perhaps accounts for the difficulties that economists face compared to say biologists.

Correct. Indeed it need not change over time - there is considerably variety across nations at any given time. The complexity involved in trying to formulate 'universal' theories doesn't, imho, make the discipline any less scientific. It just makes it more difficult.

redarmyblues wrote: »

The apparent stagnantion before 1800 is illusory, if you look more closely at it you would find lots of fractal booms and busts.

Again, I disagree. And so does the profession.

Events since 1800 are a boomier boom to be followed by a bustier bust.

I have to disagree. A boom/bust cycle would look something like a sine wave. That looks like an exponential curve to me.

What is studied by economicists the figures, stats, etc are the consequences of biological events that have F**k all git to do with free will or rational choices.

That's a hell of a claim to make. Are you suggesting that the changes in the exchange rate between $ and € are consequences of biological events, or by human interaction?

Sure, you can argue that it's driven by psychological urges (and I'd agree) and that is at least partly driven by biology. No argument there. However your argument seems to suggest something along the lines of changes in testosterone levels of traders determine exchange rates. That's true, to a very small extent, but it's primarily free actors making decisions that they think are the best for themselves. Supply and demand is not a biological concept.

Ecomonics exists only to give the illusion of control over what are for all intents and purposes random events.

That's nonsense. Economists openly admit that a lot of life is random and unpredictable. That doesn't mean that the price of coffee is completely randomly determined, or that causal policy evaluation is useless, or anything at all really.

When I referred to populations I intended the term to include populations of debt, train carraiges, dollars, priests etc.

I have no idea what this means.

I see you've added more.

redarmyblues wrote: »

On the subject of idealogical bias I notice that you mistook my Skepticism for I suppose Dialectical Materialism. While I may subscribe to a Hegelian view of history it would be of a decidedly Darwinian bent. Your obvious bristling at my post does I am afraid expose your partiality to Neoliberalism or whatever you wish to call it.

Me, a neoliberal? Lol. You need more rigorous skills of inference, young padawan.

I have always contended that Popes, Grand Ayatollahs, Grand Moderaters, the leaders of religions were all in their heart of hearts arrantly atheistic and alligned themselves with their respective belief systems in order of importance for...(a)Power. (b) A source of easy living (c) As an intellectual plaything.

Economists must suffer with silver and bronze in Ireland anyway. While I do not deny the partiallity of the Pope or Ian Paisley to their chosen faith, I deny their disinterest.

Again: cool story, bro.

By all means preach your creed but woe betide you practice it, for then we are in ropes and ropes of trouble.

This is truly nonsense. There is no creed in economics. It's an academic discipline. Papers looking at the causal effects of mandatory health insurance of health outcomes is not a political plot. Papers trying to understand exchange rates is not a neoliberal endeavour. Mathematical models of distortion-minimising taxes are not conspiracies. Economics is a discipline trying to understand topics about a subset of human behaviour. I'm not sure how your rants about social Darwinism or Ian Paisley are relevant to that.

I'm lost , pre the IR a significant driver of "the economy" would have been climate. During the IR the growth graph is obvious to see, unless we are going back to oxen and plough there can only ever be very small retracements in terms of output. However there are still investment cycles or a business cycle that throws up recessions every decade or so. Had anyone in the US in 1930 been asked about the "Great Depression" they would be talking about the 1870's. Are ye just arguing over time frames and degree?