As made manifest by Clower's comments on their “science fiction” nature, general equilibrium theories present such peculiar and puzzling features that the methodologist must perforce seek some specific methodological accommodation for this part of economic theory. The role played by such theories in contemporary economics is so fundamental that the impossibility of appraising them by means of any version of falsificationism, and their patent lack of empirical content if approached with the conceptual devices of the methodology of scientific research programs, (...) have prompted several scholars interested in the methodology of economics to search for a reasonable way out. (shrink)

Douglas W. Hands's “What Economics Is Not: An Economist's Response to Rosenberg“ is an unsympathetic criticism of the explanatory hypotheses of “If Economics Isn't Science, What Is It?”. Before replying to his objection, I summarize the claims of that paper.

Discussions of Karl Popper's falsificationist philosophy of science appear regularly in the recent literature on economic methodology. In this literature, there seem to be two fundamental points of agreement about Popper. First, most economists take Popper's falsificationist method of bold conjecture and severe test to be the correct characterization of scientific conduct in the physical sciences. Second, most economists admit that economic theory fails miserably when judged by these same falsificationist standards. As Latsis states, “the development of economic analysis would (...) look a dismal affair through falsificationist spectacles.”. (shrink)