Economists customarily talk about the ‘realism’ of economic models and of their assumptions and make descriptive and prescriptive judgements about them: this model has more realism in it than that, the realism of assumptions does not matter, and so on. This is not the way philosophers mostly use the term ‘realism’ thus there is a major terminological discontinuity between the two disciplines. The following remarks organise and critically elaborate some of the philosophical usages of the term and show some of (...) the ways in which they relate to economists’ concerns. In the philosophy of science, scientific realism is the mainstream position – or rather a heterogeneous collection of positions - that includes ideas about the nature of scientific theories and how they are related to the real world and about the goals and achievements of scientific inquiry. However, most of what philosophers have contributed around these ideas is not designed to deal with the peculiarities of economics, thus some important adjustments are needed to make scientific realism an interesting position for economists. (shrink)

The paper seeks to offer [1] an explication of a concept of economics imperialism, focusing on its epistemic aspects; and [2] criteria for its normative assessment. In regard to [1], the defining notion is that of explanatory unification across disciplinary boundaries. As to [2], three kinds of constraints are proposed. An ontological constraint requires an increased degree of ontological unification in contrast to mere derivational unification. An axiological constraint derives from variation in the perceived relative significance of the facts explained. (...) An epistemological constraint requires strong fallibilism acknowledging a particularly severe epistemic uncertainty and proscribing against over-confident arrogance. (shrink)

If models can be true, where is their truth located? Giere (Explaining science, University of Chicago Press, Chicago, 1998) has suggested an account of theoretical models on which models themselves are not truth-valued. The paper suggests modifying Giere’s account without going all the way to purely pragmatic conceptions of truth—while giving pragmatics a prominent role in modeling and truth-acquisition. The strategy of the paper is to ask: if I want to relocate truth inside models, how do I get it, what (...) else do I need to accept and reject? In particular, what ideas about model and truth do I need? The case used as an illustration is the world’s first economic model, that of von Thünen (1826/1842) on agricultural land use in the highly idealized Isolated State. (shrink)

There is an increasingly widespread belief, both within and outside the discipline, that modern economics is irrelevant to the understanding of the real world. Economics and Reality traces this irrelevance to the failure of economists to match their methods with their subject, showing that formal, mathematical models are unsuitable to the social realities economists purport to address. Tony Lawson examines the various ways in which mainstream economics is rooted in positivist philosophy and examines the problems this causes. It focuses on (...) human agency, social structure and their interaction and explores how the understanding of this social phenomena can be used to transform the nature of economic practice. Economics and Reality concludes by showing how this newly transformed economics might set about shaping economic policy. (shrink)

Ever since David Hume, empiricists have barred powers and capacities from nature. In this book Cartwright argues that capacities are essential in our scientific world, and, contrary to empiricist orthodoxy, that they can meet sufficiently strict demands for testability. Econometrics is one discipline where probabilities are used to measure causal capacities, and the technology of modern physics provides several examples of testing capacities (such as lasers). Cartwright concludes by applying the lessons of the book about capacities and probabilities to the (...) explanation of the role of causality in quantum mechanics. (shrink)

In this sequence of philosophical essays about natural science, the author argues that fundamental explanatory laws, the deepest and most admired successes of modern physics, do not in fact describe regularities that exist in nature. Cartwright draws from many real-life examples to propound a novel distinction: that theoretical entities, and the complex and localized laws that describe them, can be interpreted realistically, but the simple unifying laws of basic theory cannot.

Since its original publication in 1979, The Possibility of Naturalism has been one of the most influential works in contemporary philosophy of science and social science. It is a cornerstone of the critical realist position, which is now widely seen as offering a viable alternative to move positivism and postmodernism. This revised edition includes a new foreword.

This book offers a comprehensive overview of the structure, strategy and methods of assessment of orthodox theoretical economics. In Part I Professor Hausman explains how economists theorise, emphasising the essential underlying commitment of economists to a vision of economics as a separate science. In Part II he defends the view that the basic axioms of economics are 'inexact' since they deal only with the 'major' causes; unlike most writers on economic methodology, the author argues that it is the rules that (...) economists espouse rather than their practice that is at fault. Part III links the conception of economics as a separate science to the fact that economic theories offer reasons and justifications for human actions, not just their causes. With its lengthy appendix introducing relevant issues in philosophy of science, this book is a major addition to philosophy of economics and of social science. (shrink)

Making sense of economists and their world in a persuasive and entertaining style, Arjo Klamer, the author of a number of influential books including _Conversation with Economists_ and _The Consequences of Economic Rhetoric_, shows that economics is as much about how people interact as it is about the models, the mathematics, the econometrics, the theories and the ideas that come from the enormous aggregate of economics literature. Knowing and understanding economics requires both bookwork and mingling with other economists. Viewing the (...) subject as a collection of conversations, Klamer examines fundamental disagreements over the nature and purpose of the discipline, addressing how it is that a discipline that so permeates daily life is at once ‘soft’ and scientific, powerful and ignored, noble and disdained and in a reader-friendly style – without eschewing academic methodology demonstrates economics to be a living, breathing discipline rooted in the real world. Whether you are a student, academician, journalist, practising economist or interested outsider, _Speaking of Economics_ will get you interested in a conversation about economics. (shrink)

Many participants in the debate over the current state and recent developments of economics make claims that are unrefined, simplistic, often exaggerated. This is understandable: the stakes are high, the issues trigger emotional responses, and few participants are motivated or equipped to seek more nuanced analyses. To assert, or to deny, that economics as a scientific discipline or a particular part of it (such as a model) is about reality – or refers to reality, represents it, is true about it, (...) or is truthlike about it – is to make a very complex and highly ambiguous claim. 1 The disputants often make claims that have parallels in the philosophical controversy between scientific realists and their opponents, or at any rate those claims can be partly analyzed in terms of some of the arguments presented in this philosophical controversy. The question addressed here is whether realism about economics is a viable position. The argument proceeds by way of refuting a number of arguments against realism about economics. I suggest a genuine controversy over the factuality of any particular strand or piece of economics requires realism as a general interpretation of economics – or at any rate requires debunking the anti-realist arguments discussed below. “The issue of realism” as most economists would recognize it, is not exactly the issue of realism as philosophers recognize it. “The issue of realism” in economics is about realisticness as a property of theories , while (part of) the issue of realism in philosophy is about realism as a theory of theories . But some parts of the issue of realisticness (such as those related to reference and truth) in economics can be translated into aspects of the issue of realism as a theory of theories. Thus there is also an issue of realism (with no quotation marks) in economics. It is this issue of realism that has to be settled as a prerequisite for critical assessments of important forms of realisticness of economic theories. (shrink)

Economics today cannot predict the likely outcome of specific events any better than it could in the time of Adam Smith. This is Alexander Rosenberg's controversial challenge to the scientific status of economics. Rosenberg explains that the defining characteristic of any science is predictive improvability--the capacity to create more precise forecasts by evaluating the success of earlier predictions--and he forcefully argues that because economics has not been able to increase its predictive power for over two centuries, it is not a (...) science. (shrink)

A few aspects of the issue of realism are addressed in the context of a social science. The paper looks for adjustments needed in our conceptions of scientiflc realism to accommodate some peculiarities of economics. Ontologically speaking, economics appears to be closely linked to commonsense conceptions of the world, thus the problem of theoretical concepts does not emerge in the same form it is often taken to exist in physics. Theory formation is largely a matter of idealization and isolation among (...) observables rather than postulation of unobservables. Given that isolative theories violate the truth in many ways, truth is more of a problem than existence in a realism pertaining to economics. The idea of significant truth -which is able to tolerare varieties of untruths in theories- is suggested to be based on the notion of the way the world works; this is a matter of the causal structure and functioning of the world. None of this is undermined by the acknowledgement that economist’s attittudes and decisions are shapped by rhetorical persuasion. (shrink)

The experimental approach in economics is a driving force behind some of the most exciting developments in the field. The 'experimental revolution' was based on a series of bold philosophical premises which have remained until now mostly unexplored. This book provides the first comprehensive analysis and critical discussion of the methodology of experimental economics, written by a philosopher of science with expertise in the field. It outlines the fundamental principles of experimental inference in order to investigate their power, scope and (...) limitations. The author demonstrates that experimental economists have a lot to gain by discussing openly the philosophical principles that guide their work, and that philosophers of science have a lot to learn from their ingenious techniques devised by experimenters in order to tackle difficult scientific problems. (shrink)

Rosenberg applies current thinking in philosophy of science to neoclassical economics in order to assess its claims to scientific standing. Although philosophers have used history and psychology as paradigms for the examination of social science, there is good reason to believe that economics is a more appropriate subject for analysis: it is the most systematized and quantified of the social sciences; its practitioners have reached a measure of consensus on important aspects of their subject; and it encompasses a large number (...) of apparently law-like propositions. (shrink)

Explanatory unification—the urge to “explain much by little”—serves as an ideal of theorizing not only in natural sciences but also in the social sciences, most notably in economics. The ideal is occasionally challenged by appealing to the complexity and diversity of social systems and processes in space and time. This article proposes to accommodate such doubts by making a distinction between two kinds of unification and suggesting that while such doubts may be justified in regard to mere derivational unification (which (...) serves as a formal constraint on theories), it is less justified in the case of ontological unification (which is a result of factual discovery of the actual degree of underlying unity in the world). (shrink)

Is economics a science? Deidre McCloskey says 'Yes, but'. Yes, economics measures and predicts, but - like other sciences - it uses literary methods too. Economists use stories as geologists do, and metaphors as physicists do. The result is that the sciences, economics among them, must be read as 'rhetoric', in the sense of writing with intent. McCloskey's books, The Rhetoric of Economics and If You're So Smart, have been widely discussed. In Knowledge and Persuasion in Economics he converses with (...) his critics, suggesting that they too can gain from knowing their rhetoric. The humanistic and mathematical approaches to economics, says McCloskey, fit together in a new 'interpretive' economics. Along the way he places economics within the sciences, examines the role of mathematics in the field, replies to critics from the left, right and centre, and shows how economics can again take a leading place in the conversation of humankind. (shrink)

Challenges the widely held view that good models must necessarily be simplifications and hence cannot be true. This is done by distinguishing between whole truth (complete description) and truth (essential description, attained by the method of isolation).

All economic models involve abstractions and idealisations. Economic theory itself does not tell which idealizations are truly fatal or harmful for the result and which are not. This is why much of what is seen as theoretical contribution in economics is constituted by deriving familiar results from different modelling assumptions. If a modelling result is robust with respect to particular modelling assumptions, the empirical falsity of these particular assumptions does not provide grounds for criticizing the result. In this paper we (...) demonstrate how derivational robustness analysis does carry epistemic weight and answer criticism concerning its non-empirical nature and the problematic form of the required independence of the ways of derivation. The epistemic rationale and importance of robustness analysis also challenge some common conceptions of the role of theory in economics. (shrink)

The cultural and epistemic status of science is under attack. Social and cultural studies of science are widely perceived to offer evidence and arguments in support of an anti-science campaign. They portray science as a mundane social endeavour, akin to religion and politics, with no privileged access to truthful information about the real world. Science is under threat and needs defence. Old philosophical legitimations have lost their bite. Alarm bells ring, new troops have to be mobilised. Call economics, the good (...) old friend of the status quo depicting it as a generally beneficial social order while accommodating a rather mundane picture of human behaviour. In contrast to constructivist and relativist sociology of scientific knowledge, economic accounts of science seek to provide a rigorous defence of the cultural and epistemic legitimacy of science by accommodating plausible elements in the sociological accounts and by embedding them in invisible-hand arguments about the functioning of some market-like structure within science. Viewed through economic spectacles, science re-emerges from the ashes as stronger and more beautiful than ever. A spectator raises an innocent question: is economics itself strong and beautiful enough to offer such alleviating services? In order to examine the emerging issue of disciplinary credibility, we need to look at economics itself more closely, and we need to address traditional issues in the philosophy of science as well as less traditional issues of reflexivity. We will see that the above caricature concerning the role of economics in the science wars calls for heavy qualifications if not wholesale rejection. (shrink)

In order to examine the fit between realism and science, one needs to address two issues: the unit of science question (realism about which parts of science?) and the contents of realism question (which realism about science?). Answering these questions is a matter of conceptual and empirical inquiry by way local case studies. Instead of the more ordinary abstract and global scientific realism, what we get is a doubly local scientific realism based on a bottom-up strategy. Representative formulations of the (...) former kind are in terms of the truth and reality of the posits of current science, in terms of warranted belief, in terms of mind-independent unobservable entities. Using illustrations mainly from the social sciences, doubly local scientific realism denies the global applicability of such formulations and seeks to make adjustments in their elements in response to information about local units of science: It is sufficient for a realist to give the existence of an entity (and the truth of a theory) a chance, while in some areas we may be in s position to make justified claims about actual existence (and truth). Logical inquiry-independent existence is sufficient for the social and human sciences, while mind-independence will be fine for many other domains. It should not be insisted that the theoretical posits of realist science be strict unobservables in all areas: most theoretical posits of the social sciences are idealized commonsensibles, such as elements in folk psychology. Unsurprisingly, this sort of local strategy will create space for realism that is able to accommodate larger areas of science without sacrificing traditional realist intuitions. (shrink)