Nope, the savings identity is a tautological (and praxeological!) concept, it has nothing to do with the actual quantities saved/invested at any particular time.
Nope. Everything I said in my last post was a continuation of what I said previously in this thread.
The very point is that economics and other social sciences cannot be treated in the same way as the physical sciences!!
And no quantitative constants exist in the social sciences.
That’s what I said in my first post in this thread. You realised that you are getting owned hard and are somehow trying to backtrack to make it look like you know what you’re talking about.
This must be an admission that so-called empirical evidence is of no use in forming economic theory. Welcome to praxeology.
Their opinions on the most popular flavours of lollipops has nothing to do with the nature of economics, and neither did your initial ‘point’ in the original post.
Whoops, edited my post. Constants and variables are separated only by semantics. Setting any of these quantities to specific constants just changes the application of the theory. The “this is when we have $1 of savings theory” sets savings constant to 1.
That means little. The parts of physics that are not derived from quantitative constants (which, like I’ve said, is a purely semantic arrangement) are not any less valid.
The “quantitative constants” that exist in other sciences, like the speed of light, are actually empirically derived.
That doesn’t follow. There’s a difference between proof and evidence.
edit:
The fact that you keep asserting physical science models are somehow different from economics, or don’t rely on empirically derived variables, seems to go against this.
Look, let me drop the multiquoting and sum it up in a paragraph:
Where do you think the physical constants in physics were derived? None of them were simply “derived”. They all had to be established empirically, often using (gasp) statistical models. The only purely deductive science is math, and math has no “physical constants” by your apparent definition.
Pretty much anything you’ve said about mainstream economics (which is what I mean when I say “economics”) can be said about other sciences.
I hate to break it to you but what you just said sure looks like praxeology to me.
Exactly, and they cannot be in economics due to the difference between stones and men.
So you didn’t agree with the point I was making about post hoc ergo propter hoc? And I thought you were making some progress!
How so? I never said that physics does not rely on empiricism, in fact my entire point was that physics does rely on empiricism and that because the nature of human action is different to that of the object of inquiry in the physical sciences, economics cannot employ an empirical method!
The fact that you think that I or any other Austrians believe that physics relies ultimately and solely on deduction shows that not only did you misunderstand what I was saying, but you also failed to read the links provided by other users and their explanations of them. Go back and read them properly.
As a related note, where do you draw the line between “bad” empiricism using social sciences and “good” empiricism using physical sciences? Is behavioral psychology invalid? Is evolutionary biology invalid?
The point is that we cannot trace the causes of all human preferences back beyond the existence of human action in order to predict how each and everyone will act in every situation. This is not the case in relation, for example, to the combination of various chemical elements.
Praxeology, which is employed both by Austrian and mainstream economists (not to mention by the original Keynesian, Lord Keynes!), can provide qualitative ceteris paribus predictions. The fact that all other conditions in the real world may not remain the same is the major reason why the empirical method cannot be employed in economics.
Behaviourism, yes. Evolutionary biology does not claim to be able to (or ever to be able to) predict all human action in a positivistic sense. Climate science has nothing to do with human action, I honestly have no idea why you brought it up.
Anyway, I never said psychology was invalid overall - merely that it is not the same as economics. In fact that’s what my very first sentence in this thread was about!!!
No one said it did. What about the economics papers about the marriage market or evolutionary psychology? What happens when there’s overlap in the anal retentive distinction between “biology” and “psychology”?
I also see you’ve wiped out an entire area of science offhand.
Because you said that sciences involving changing conditions should not use empirical evidence. If you accept climate science, you accept that “changing conditions” do not destroy empiricism.
Well if the analogy is exact, then yes - ‘studies’ that employ such a methodology must be rejected because they are simply a game of post hoc ergo propter hoc, with no definite ability to pin down causation. Theoretically, however, climate science is no different from the other physical sciences.
And it uses empirical models similar to those used in economics. You haven’t established that the nature of climate events is qualitatively different from the complexity of human interaction, or that it’s improper to apply neurology (for example) to economics.
Take this paper. Does the fact that it combines evolution and economics invalidate its empirical method?
I just rejected the idea that we can gain anything from the post hoc ergo propter hoc methodology when there is constant change. If that is what those climate models are, then sure they can be rejected along with the economic ones of that type.
Where it discusses means it may be complimentary to economics, where it discusses ends it is part of psychology. The point is that in the latter case neurology deals with different things to what economics does. In that case what you’re saying is akin to the statment ‘you haven’t established that it’s improper to apply metallurgy (for example) to economics’.
As for the article, it does not contradict economic theory at all, despite the beliefs of its authors. That women haven’t become more selective than men when there is a greater supply of men vs. women doesn’t mean that they haven’t become more selective or wouldn’t become more selective than they were when/if there was a lesser supply of men vs. women! But again, note that it is called evolutionary psychology.
Mises has a quote somewhere where he addresses this point, probably in HA. Anyway, he basically points out that the supposedly “evidence-based” economic models that apply mathematical equations to human behavior completely fail to take into account the actual evidence of human behavior which is immensely complex. Instead, they substitute something that does not resemble a human being at all (homo economicus) and build mathematical models describing the behavior of this mythical entity.
They also fail to provide any suitable form of abstraction (aka deductive model) by which to pass over the complexity and reason about the knowable facts of human behavior. Which is precisely what praxeology does.
Now, we can give some constants of human nature - the human body maintains a temperature around 98.6 degrees, a heart rate in the range of 60-90 bpm at rest, and so on. But these are really biological/medical facts, they are not facts about social behavior, which is really the subject of study of any social science. We can look at a slightly higher level at brain function and identify constants there. We can identify some correlations between certain behaviors and blood flow in the brain. But that really doesn’t tell us much, it’s like trying to model the behavior of a computer by pointing an infrared camera at the motherboard.
But the neurological approach - while at least truly scientific - is unnecessarily tedious and too microscopic for the task of studying human behavior. All you need in order to study human behavior is to admit: human beings have purposes (ends) at which they are aiming by acting, that is, applying available means to bring about these ends. I suspect that the revulsion of mainstream science at using this as a starting point for a science is that they fail to separate between object and subject - the fact that our object of study is value-laden does not mean that we (the subject) must study it in a value-laden way.
Well, what else are meteorlogists supposed to do? Deduce tomorrow’s weather from a set of fundamental axioms?
Climate science and meteorology rely on empiricism. You have to specify how, exactly, we can understand weather but not human behavior through observation. Mises doesn’t like to admit it, but the very fact that people act in their own interests and express preferences at all is ultimately an empirical observation.
No, that is a semantic assertion and it doesn’t follow. Metallurgy is entirely applicable to economics, especially engineering economics, unless you have your own definition of which scientists can study means and ends and which can’t.
Which has substantial overlap with economics. Accepting one’s empirical methods without the other’s is a funny position.
I’d just like to point out that Peter Schiff, Marc Faber, and Jim Rogers are just three investors (Schiff started a hedgefund, remember?) who model their behavior on the Austrian school. Production vs. paper and debt. The higher the dividend, the more likely is that the company has long term stability. It is not a distinctively “Austrian” investment strategy, but it is what they recommend. This whole thread was trollfest.
The same goes for weather modeling, biological system modeling, or any number of other complex systems in science. Why not reject those fields as well?
And there are utility models in mainstream economics as well. These “knowable facts of human behavior” have to ultimately rely on empiricism.
So are you saying that positivist economics is based on values? Not at all.
Good point. But it does seem that the market is not very good at selecting the most solid economic model. The past decade was well suited for a conservative or commidties based investment strategy. But we’ll see if Schiff is right about hyperinflation.
Aristippus is simply pointing out that post hoc ergo propter hoc is a fallacious line of reasoning and unsuitable for use in any science. Weather models are not post hoc ergo propter hoc. The meteorologist is not merely saying “after three thunderstorms in a row, there will always be a week of sunshine”. Rather, they are using physical principles (which, in turn, are derived from a combination of real-experiment and thought-experiment) which are applied to the data. For example, the physics of gases is what dictates that high pressure areas will flow into low pressure areas. The whole point of measuring pressure is that we understand the physics of pressure and how it must affect the behavior of weather patterns. So, the meteorologist can say “here is a high pressure area and here is a low-pressure area… the low-pressure area cannot flow into the high-pressure area because the laws of physics say so.” He’s not merely applying linear regression to barometric data and then curve-fitting.
It’s funny that you keep mentioning evolutionary biology and evolutionary psychology when both of these sciences are almost entirely deductive sciences! The central thesis of Darwinism - the common descent of all species - is a feat of deductive logic based on the principle that a trait originating in a common ancestor with two offspring is a priori more probable than that a trait arose independently in two separate species. The inevitable conclusion is that all living things have a common ancestor because we all share a significant set of traits: organic chemical composition, cell-structure, RNA, DNA, etc.
No, because meterologists don’t try to pretend that cyclones are actually Archimedean spirals or that the Earth is actually a geometrical sphere and then deduce facts about the random distribution of Archimedean spirals over a geometric sphere and then claim that they’re saying something about real weather.
The problem is not the complexity, the problem is ignoring the actual evidence.