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Only the real science approach ever works. If your "science" is using any other approach, it is not a science, period. And there is a proper, scientific approa

by sklogic 11y ago

Only the real science approach ever works. If your "science" is using any other approach, it is not a science, period. And there is a proper, scientific approach in the economics: behavioural economics. Instead of hand waving about some "ideal", non-existant agents acting fully rationally upon a 100% correct and impossible information available, as the classic bullshit economics does, the proper, behavioural economics starts with studying the real individuals behaviour (which is very much doable, no matter what the others are saying), and only then drawing conclusions about the herd behaviour in a statistical scale.

JupiterMoon 11y ago
Isn't his point that there is a sort of uncertainty principle in economics? For example when you study people they behave differently and furthermore as soon as they think that you think that they will behave in a certain way they may well behave differently -- especially if there is financial gain at stake for changing their behaviour. As you say this all derives from the biggest problem with all the social sciences people are not rational actors and any mathematical model has to encapsulate real human behaviour.
- TuringTest 11y ago
  > For example when you study people they behave differently and furthermore as soon as they think that you think that they will behave in a certain way they may well behave differently That's not an inherent limitation for applying science. Signal theory has models that represent circuits with feedback loops, where the output ; similar models could be developed to study people who know are being studied. Also, if you use data collections that were compiled for other purposes, you can study the behavior of people who don't know are participating un such study. Big data is essentially that. > As you say this all derives from the biggest problem with all the social sciences people are not rational actors and any mathematical model has to encapsulate real human behaviour. There are theories that don't assume perfect rational agents, and can still predict behavior by studying the common human bias. See the work of behavioral economist Dan Ariely for an academic approach.
jevgeni 11y ago
I'm sorry, but I don't want to debate your personal definition of the word "science". Per convention economics is called a "social science" and that's a convention I will adhere to. In addition to what JupiterMoon says, I'd say that individual behaviour was never a real problem in economics. A lot of the theories are built on stupid assumptions about rational behaviour, but that's just it: you always can change the assumptions and see what happens. Behavioural economics is just that. The real problem of economics is scale and inability to cleanly experiment on that scale. To imply any kind of large scale "herd" behaviour from individual behaviour would still require a tonne of a priori, non-falsifiable assumptions. Even if the assumptions can be shown to be valid now, it would be impossible to prove that they are stable and valid for a long period of time.
icebraining 11y ago
Yet, the "spherical cow in a vacuum" expression came from a hard science. Einstein didn't exactly develop his relativity theories by making measurements and drawing statistical conclusions either. Pure theory has its place in science, as long as one is honest about its limitations.
- sklogic 11y ago
  Relativity theory fits well into this description. It (the special relativity) was derived from a formal attempt to unify classical mechanics and Maxwell electrodynamics, which was only possible if you ditch the Galilean relativity. Both classical mechanics and electrodynamics, in turn, came from a huge body of experimental data. General relativity is a different thing, it was a pure hypothesis, an extrapolation of the simplest possible generalisation of the special relativity [1]. And it held this hypothesis status up until it was sufficiently confirmed by the incoming experimental data. Before that, a multitude of alternative hypotheses existed which had the same numerical predictions covering the available experimental data (e.g., https://en.wikipedia.org/wiki/Anatoly_Logunov#Relativistic_theory_of_gravitation https://en.wikipedia.org/wiki/Anatoly_Logunov#Relativistic_t...). So, yes, it's important to distinguish theory from a hypothesis. [1] this "simplest possible generalisation" method works most of the time, but not always, so it's mostly valid to do so in the hard sciences, and should never be used as a justification for hand waving in the social sciences.

by sklogic 11y ago

JupiterMoon 11y ago

Isn't his point that there is a sort of uncertainty principle in economics? For example when you study people they behave differently and furthermore as soon as they think that you think that they will behave in a certain way they may well behave differently -- especially if there is financial gain at stake for changing their behaviour. As you say this all derives from the biggest problem with all the social sciences people are not rational actors and any mathematical model has to encapsulate real human behaviour.

TuringTest 11y ago
> For example when you study people they behave differently and furthermore as soon as they think that you think that they will behave in a certain way they may well behave differently That's not an inherent limitation for applying science. Signal theory has models that represent circuits with feedback loops, where the output ; similar models could be developed to study people who know are being studied. Also, if you use data collections that were compiled for other purposes, you can study the behavior of people who don't know are participating un such study. Big data is essentially that. > As you say this all derives from the biggest problem with all the social sciences people are not rational actors and any mathematical model has to encapsulate real human behaviour. There are theories that don't assume perfect rational agents, and can still predict behavior by studying the common human bias. See the work of behavioral economist Dan Ariely for an academic approach.

jevgeni 11y ago

I'm sorry, but I don't want to debate your personal definition of the word "science". Per convention economics is called a "social science" and that's a convention I will adhere to. In addition to what JupiterMoon says, I'd say that individual behaviour was never a real problem in economics. A lot of the theories are built on stupid assumptions about rational behaviour, but that's just it: you always can change the assumptions and see what happens. Behavioural economics is just that. The real problem of economics is scale and inability to cleanly experiment on that scale. To imply any kind of large scale "herd" behaviour from individual behaviour would still require a tonne of a priori, non-falsifiable assumptions. Even if the assumptions can be shown to be valid now, it would be impossible to prove that they are stable and valid for a long period of time.

icebraining 11y ago

Yet, the "spherical cow in a vacuum" expression came from a hard science. Einstein didn't exactly develop his relativity theories by making measurements and drawing statistical conclusions either. Pure theory has its place in science, as long as one is honest about its limitations.

sklogic 11y ago
Relativity theory fits well into this description. It (the special relativity) was derived from a formal attempt to unify classical mechanics and Maxwell electrodynamics, which was only possible if you ditch the Galilean relativity. Both classical mechanics and electrodynamics, in turn, came from a huge body of experimental data. General relativity is a different thing, it was a pure hypothesis, an extrapolation of the simplest possible generalisation of the special relativity [1]. And it held this hypothesis status up until it was sufficiently confirmed by the incoming experimental data. Before that, a multitude of alternative hypotheses existed which had the same numerical predictions covering the available experimental data (e.g., https://en.wikipedia.org/wiki/Anatoly_Logunov#Relativistic_theory_of_gravitation https://en.wikipedia.org/wiki/Anatoly_Logunov#Relativistic_t...). So, yes, it's important to distinguish theory from a hypothesis. [1] this "simplest possible generalisation" method works most of the time, but not always, so it's mostly valid to do so in the hard sciences, and should never be used as a justification for hand waving in the social sciences.