Economic modeling — nothing but obscurantist bullshit

5 August, 2016 at 16:31 | Posted in Economics | 1 Comment

65675509In the present article I consider the less frequently phenomenon of “hard obscurantism”, a species of the genus scholarly obscurantism. In academic debates, a more common term for obscurantism is “bullshit” … One may perhaps, distinguish between obscure writers and obscurantist writers. The former aim at truth, but do not respect the norms for arriving at truth, such as focusing on causality, acting as the Devil’s Advocate, and generating falsifiable hypotheses. The latter do not aim at truth, and often scorn the very idea that there is such a thing as the truth …

Although I believe that the cases I have selected for analysis are somewhat representative of mainstream economic theorizing, I cannot make strong claims about how typical they are. What I can assert with great confidence is that the authors I have singled out are far from marginal, and in fact are at the core of the profession. Their numerous awards testify to this fact.

These writings have in common a somewhat uncanny combination of mathematical sophistication on the one hand and conceptual naiveté and empirical sloppiness on the other. The mathematics, which could have been a tool, is little more than toy. The steam engine was invented by Hero of Alexandria in the first century A. D., but he considered it mainly as a toy, not as a tool that could be put to productive use. He did apparently use it, though, for opening temple doors, so his engine wasn’t completely idling. Hard obscurantist models, too, may have some value as tools, but mostly they are toys.

I have pointed to the following objectionable practices:

1. Citing empirical evidence in a cavalier way, in the form of anecdotes, “impressions”, and unsubstantiated historical claims …

2. Adopting huge simplifications that make the empirical relevance of the results essentially nil …

3. Assuming that the probabilities in a stochastic process are known to the agents … or even in some sense optimal …

5. Assuming that the unconscious has the capacity to carry out inter temporal tradeoffs …

7. Assuming that agents can choose optimal preferences …

11. Adhering to the instrumental Chicago-style philosophy of explanation, which emphasizes as-if rationality and denies that the realism of assumptions is a relevant issue.

Jon Elster  (Synthese 7/2016)

It’s hard not to agree with Elster’s critique of mainstream economics and its practice of letting models and procedures become ends in themselves, without considerations of their lack of explanatory value as regards real world phenomena. For more on modern mainstream economics and this kind of wilfully silly obscurantism, yours truly self-indulgently recommend reading this article on RBC or this article on mainstream axiomatics.


1 Comment

  1. Most models of our economics system are unsatisfactory because they do not cover all of the big picture, and their implied assumption that “everything else doesn’t change” is untrue. When the model does include the whole system there is a need to make it simpler and this is where the skill of improving the presentation for an understanding of our social system, comes into play. Because so many of the experts don’t have this skill, our modeling gets such a bad reputation, even when the model meets this criterion.

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