From: Anders Ekeland (anders.ekeland@ONLINE.NO)
Date: Mon Apr 17 2006 - 10:28:12 EDT
Isn't it also a huge discussion precisely what kind of logic we are talking about, especially in economics? Where the mainstream neo-classical "logic" is static equilibrium, and everything else is regarded as "verbal" (ad hominem)? The same static logic of Sraffa and Bortkiewicz also has fundamental effects on what is regarded as logical, consistent, cf. the discussion about the transformation problem. If you then go to dynamic systems, cybernetics, chaos theory, this logic (these mathematical tools) is much less restrictive regarding what is regarded as "logical". Quite other "stories" can be told using this kind of "logic". My answer to Mike L. would be that is not a mere question of integrating some divine "logic" with "verbal persuasion". We need to discuss what kind of logic is at the basis of economics. No argument is convincing if it is not logical. Concretely what we need more than ever is to continue the fight against the static equilibrium logic in economics. IMHO no argument, no theoretical result, that builds on static equilibrium should be accepted unless stability is proven, i.e. what happens if we are not in equilibrium. This is a task that the Arrow-Debreu school still faces, their Achilles heel indeed, not "logic" on their chosen terrain. Because capitalism is never in static equilibrium, the same forces that drives towards equalization of profits also creates vastly different profit rates - endlessly. Just to mention one aspect of this faulty "logic". Before radical economist call "perfect competition" by its right name, that is "perfect stagnation" - this fight is not over. There is not an iota of competition in "perfect competition" - only utter stagnation. From a welfare maximizing point of view "perfect competition" is definitely not a place we want to be. To me dynamic systems - and computers that can solve complex equation systems numerically - makes it possible to formulate many "verbal" - "ad hominem" arguments in mathematical, i.e. "logical" terms. This makes it possible to express common sense economic reasoning - which is always dynamic, non-linear, having a lot of interaction (feed-back) among the various processes it describes. Most people - even some radical economists - do not realize how utterly static "perfect competition" is. They no not realize that there is no theory on how we get there and stay there, given the improbable case that we should happen have such perverse utility functions as to wanting to to be in such a dismal state. Regards Anders Ekeland At 21:26 16.04.2006, glevy@PRATT.EDU wrote: > > Back to my not-so-whimsical question--- do we need more > > abstract theory or more attempts at persuading and developing a new > > common sense these days? > >Hi Mike L, > >It shouldn't be an 'either - or' type of question. The question should >be how the two can best be integrated. Easily said, of course, .... > >In solidarity, Jerry > >PS: beware cherries that are picked from a poisoned field.
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