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> Economics is about explaining things after the fact, and incapable of prediction. > > Therefore, it's all ideology Can you give us an example of a macro or m

by lottin 4y ago

> Economics is about explaining things after the fact, and incapable of prediction. > > Therefore, it's all ideology Can you give us an example of a macro or microeconomic model that is incapable of prediction and it's (therefore?) all ideology? I can't think of none off the top of my head.

mistrial9 4y ago
unlike physics, and somewhat unlike chemistry, there is no direct causal relationship, instead it is systems of systems with new, unpredictable events entering into most of the them constantly. The time window for a prediction is also crucial, because the same set of decisions and rules in one era have different results in another era. Economists preside over this cacophony with a lot of measurements and news items. Occasionally something really worthy comes out, but the daily arguing and posturing is quite a turkey show, IMHO. Thomas Piketty got a prize recently.
JumpCrisscross 4y ago
> give us an example of a macro or microeconomic model that is incapable of prediction and it's (therefore?) all ideology? Generally, the more a theory talks about how the past actually happened the more it's ideology than falsifiable science. Take Marxism. It's largely a history of class struggles. There are testable bits, e.g. the labor theory of value (which is wrong). But most of it is unfalsifiable. Similar to the barter-then-money origin of money story, which offers zero predictive value while also being archaeologically unsupported.
- unmole 4y ago
  Neither Marxism nor the origin of money are of any interest to most economists. I don't understand the point you're trying to make.
  - JumpCrisscross 4y ago
    > Neither Marxism nor the origin of money are of any interest to most economists. I don't understand the point you're trying to make. That topics of no interest to modern economists occupy the bulk of popular discourse concerning it.
- sudosysgen 4y ago
  Theories of value are untestable, since value isn't price. The LTV can only really be argued to be wrong on philosophical and theoretical grounds, not on empirical grounds. This is because market prices are not necessarily the same as values. There are however plenty of arguments outside the empirical realm against it. If you want a testable theory from Marxism there really only are two - the aggregate rate of profit to capital will go down in the very long term, there will be endogenous economic crises due to lack of demand/too much supply in aggregate. The rest are unfalsifiable as far as I'm aware. The issue is that both of these predictions seem to be correct so far - P/E ratios are going up and we have now had plenty more evidence that crises due to mismatch between demand and supply are inherent to capitalism. However, it's still not a great tool at actually predicting the world, because the vast majority of predictions are unfalsifiable. But I agree with you that most of economics is moreso ideology.

by lottin 4y ago

mistrial9 4y ago

unlike physics, and somewhat unlike chemistry, there is no direct causal relationship, instead it is systems of systems with new, unpredictable events entering into most of the them constantly. The time window for a prediction is also crucial, because the same set of decisions and rules in one era have different results in another era. Economists preside over this cacophony with a lot of measurements and news items. Occasionally something really worthy comes out, but the daily arguing and posturing is quite a turkey show, IMHO. Thomas Piketty got a prize recently.

JumpCrisscross 4y ago

> give us an example of a macro or microeconomic model that is incapable of prediction and it's (therefore?) all ideology? Generally, the more a theory talks about how the past actually happened the more it's ideology than falsifiable science. Take Marxism. It's largely a history of class struggles. There are testable bits, e.g. the labor theory of value (which is wrong). But most of it is unfalsifiable. Similar to the barter-then-money origin of money story, which offers zero predictive value while also being archaeologically unsupported.

unmole 4y ago
Neither Marxism nor the origin of money are of any interest to most economists. I don't understand the point you're trying to make.
- JumpCrisscross 4y ago
  > Neither Marxism nor the origin of money are of any interest to most economists. I don't understand the point you're trying to make. That topics of no interest to modern economists occupy the bulk of popular discourse concerning it.
sudosysgen 4y ago
Theories of value are untestable, since value isn't price. The LTV can only really be argued to be wrong on philosophical and theoretical grounds, not on empirical grounds. This is because market prices are not necessarily the same as values. There are however plenty of arguments outside the empirical realm against it. If you want a testable theory from Marxism there really only are two - the aggregate rate of profit to capital will go down in the very long term, there will be endogenous economic crises due to lack of demand/too much supply in aggregate. The rest are unfalsifiable as far as I'm aware. The issue is that both of these predictions seem to be correct so far - P/E ratios are going up and we have now had plenty more evidence that crises due to mismatch between demand and supply are inherent to capitalism. However, it's still not a great tool at actually predicting the world, because the vast majority of predictions are unfalsifiable. But I agree with you that most of economics is moreso ideology.