On the proper use of mathematics in economics

21 October, 2016 at 10:01 | Posted in Economics | 1 Comment

19266522One must, of course, beware of expecting from this method more than it can give. Out of the crucible of calculation comes not an atom more truth than was put in. The assumptions being hypothetical, the results obviously cannot claim more than a vey limited validity. The mathematical expression ought to facilitate the argument, clarify the results, and so guard against possible faults of reasoning — that is all.

It is, by the way, evident that the economic aspects must be the determining ones everywhere: economic truth must never be sacrificed to the desire for mathematical elegance.

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  1. Before mathematics is applied to any problem it is necessary that the problem be defined first. This is not so simple in the case of economics, because it requires a number of statements defining the words being use, providing axioms and assumptions and then defining the variables. These variables can then be given algebraic symbols and this allows them to be related in the mathematical way that is a short-hand for the longer sentences of older theory.


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