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description= 15 posts published by Lars Syll during December 2020;
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e economic system and divide it into its separate parts analyse these parts one at a time and then after analysing the parts separately you put the pieces together the analytical approach is typically used in economic modelling where you start with a simple model with few isolated and idealized variables by successive approximations you then add more and more variables and finally get a true model of the whole this may sound like a convincing and good scientific approach but there is a snag the procedure only really works when you have a machine like whole system economy where the parts appear in fixed and stable configurations and if there is anything we know about reality it is that it is not a machine the world we live in is not a closed system on the contrary it is an essentially open system things are uncertain relational interdependent complex and ever changing without assuming that the underlying structure of the economy that you try to analyze remains stable invariant constant there is no chance the equations of the model remain constant that s the very rationale why economists use often only implicitly the assumption of ceteris paribus but nota bene this can only be a hypothesis you have to argue the case if you cannot supply any sustainable justifications or warrants for the adequacy of making that assumption then the whole analytical economic project becomes pointless non informative nonsense not only have we to assume that we can shield off variables from each other analytically external closure we also have to assume that each and every variable themselves are amenable to be understood as stable and regularity producing machines internal closure which of course we know is as a rule not possible some things relations and structures are not analytically graspable trying to analyse parenthood marriage employment etc piece by piece doesn t make sense to be a chieftain a capital owner or a slave is not an individual property of an individual it can come about only when individuals are integral parts of certain social structures and positions social relations and contexts cannot be reduced to individual phenomena a cheque presupposes a banking system and being a tribe member presupposes a tribe not taking account of this in their analytical approach economic analysis becomes uninformative nonsense using logical and analytical methods in social sciences means that economists succumb to the fallacy of composition the belief that the whole is nothing but the sum of its parts in society and in the economy this is arguably not the case an adequate analysis of society and economy a fortiori cannot proceed by just adding up the acts and decisions of individuals the whole is more than a sum of parts mainstream economics is built on using the analytical method the models built with this method presuppose that social reality is closed since social reality is known to be fundamentally open it is difficult to see how models of that kind can explain anything about what happens in such a universe postulating closed conditions to make models operational and then impute these closed conditions to society s real structure is an unwarranted procedure that does not take necessary ontological considerations seriously in face of the kind of methodological individualism and rational choice theory that dominate mainstream economics we have to admit that even if knowing the aspirations and intentions of individuals are necessary prerequisites for giving explanations of social events they are far from sufficient even the most elementary rational actions in society presuppose the existence of social forms that it is not possible to reduce to the intentions of individuals here the analytical method fails again the overarching flaw with the analytical economic approach using methodological individualism and rational choice theory is basically that they reduce social explanations to purportedly individual characteristics but many of the characteristics and actions of the individual originate in and are made possible only through society and its relations society is not a wittgensteinian tractatus world characterized by atomistic states of affairs society is not reducible to individuals since the social characteristics forces and actions of the individual are determined by pre existing social structures and positions even though society is not a volitional individual and the individual is not an entity given outside of society the individual actor and the society structure have to be kept analytically distinct they are tied together through the individual s reproduction and transformation of already given social structures since at least the marginal revolution in economics in the 1870s it has been an essential feature of economics to analytically treat individuals as essentially independent and separate entities of action and decision but really in such a complex organic and evolutionary system as an economy that kind of independence is a deeply unrealistic assumption to make to simply assume that there is strict independence between the variables we try to analyze doesn t help us the least if that hypothesis turns out to be unwarranted to be able to apply the analytical approach economists have to basically assume that the universe consists of atoms that exercise their own separate and invariable effects in such a way that the whole consist of nothing but an addition of these separate atoms and their changes these simplistic assumptions of isolation atomicity and additivity are however at odds with reality in real world settings we know that the ever changing contexts make it futile to search for knowledge by making such reductionist assumptions real world individuals are not reducible to contentless atoms and so not susceptible to atomistic analysis the world is not reducible to a set of atomistic individuals and states how variable x works and influence real world economies in situation a cannot simply be assumed to be understood or explained by looking at how x works in situation b knowledge of x probably does not tell us much if we do not take into consideration how it depends on y and z it can never be legitimate just to assume that the world is atomistic assuming real world additivity cannot be the right thing to do if the things we have around us rather than being atoms are organic entities if we want to develop new and better economics we have to give up on the single minded insistence on using a deductivist straitjacket methodology and the analytical method to focus scientific endeavours on proving things in models is a gross misapprehension of the purpose of economic theory deductivist models and analytical methods disconnected from reality are not relevant to predict explain or understand real world economies to have consistent models and valid evidence is not enough what economics needs are real world relevant models and sound evidence aiming only for consistency and validity is setting the economics aspirations level too low for developing a realist and relevant science economics is not mathematics or logic it s about society the real world models may help us think through problems but we should never forget that the formalism we use in our models is not self evidently transportable to a largely unknown and uncertain reality the tragedy with mainstream economic theory is that it thinks that the logic and mathematics used are sufficient for dealing with our real world problems they are not model deductions based on questionable assumptions can never be anything but pure exercises in hypothetical reasoning the world in which we live is inherently uncertain and quantifiable probabilities are the exception rather than the rule to every statement about it is attached a weight of argument that makes it impossible to reduce our beliefs and expectations to a one dimensional stochastic probability distribution if god does not play dice as einstein maintained i would add nor do people the world as we know it has limited scope for certainty and perfect knowledge its intrinsic and almost unlimited complexity and the interrelatedness of its organic parts prevent the possibility of treating it as constituted by legal atoms with discretely distinct separable and stable causal relations our knowledge accordingly has to be of a rather fallible kind if the real world is fuzzy vague and indeterminate then why should our models build upon a desire to describe it as precise and predictable even if there always has to be a trade off between theory internal validity and external validity we have to ask ourselves if our models are relevant human logic has to supplant the classical formal logic of deductivism if we want to have anything of interest to say of the real world we inhabit logic is a marvellous tool in mathematics and axiomatic deductivist systems but a poor guide for action in real world systems in which concepts and entities are without clear boundaries and continually interact and overlap in this world i would say we are better served with a methodology that takes into account that the more we know the more we know we do not know mathematics and logic cannot establish the truth value of facts never has never will share on facebook opens in new window facebook share on x opens in new window x share on bluesky opens in new window bluesky postmodern thinking 28 dec 2020 at 18 27 posted in theory of science methodology comments off on postmodern thinking the compulsive types there correspond to the paranoids here the wistful opposition to factual research the legitimate consciousness that scientism forgets what is best exacerbates through its naïvété the split from which it suffers instead of comprehending the facts behind which others are barricaded it hurriedly throws together whatever it can grab from them rushing off to play so uncritically with apochryphal cognitions with a couple isolated and hypostatized categories and with itself that it is easily disposed of by referring to the unyielding facts it is precisely the critical element which is lost in the apparently independent thought the insistence on the secret of the world hidden beneath the shell which dares not explain how it relates to the shell only reconfirms through such abstemiousness the thought that there must be good reasons for that shell which one ought to accept without question between the pleasure of emptiness and the lie of plenitude the ruling condition of the spirit geistes mind permits no third option long before postmodernism became fashionable among a certain kind of intellectuals adorno wrote searching critiques of this kind of thinking when listening to or reading the postmodern mumbo jumbo that surrounds us today in social sciences and humanities i often find myself wishing for that special annie hall moment of truth share on facebook opens in new window facebook share on x opens in new window x share on bluesky opens in new window bluesky we read to know we are not alone 27 dec 2020 at 15 46 posted in varia comments off on we read to know we are not alone share on facebook opens in new window facebook share on x opens in new window x share on bluesky opens in new window bluesky how scientists manipulate research 27 dec 2020 at 13 22 posted in statistics econometrics 1 comment all science entails human judgment and using statistical models doesn t relieve us of that necessity working with misspecified models the scientific value of significance testing is actually zero even though you re making valid statistical inferences statistical models and concomitant significance tests are no substitutes for doing real science in its standard form a significance test is not the kind of severe test that we are looking for in our search for being able to confirm or disconfirm empirical scientific hypotheses this is problematic for many reasons one being that there is a strong tendency to accept the null hypothesis since they can t be rejected at the standard 5 significance level in their standard form significance tests bias against new hypotheses by making it hard to disconfirm the null hypothesis and as shown over and over again when it is applied people have a tendency to read not disconfirmed as probably confirmed standard scientific methodology tells us that when there is only say a 10 probability that pure sampling error could account for the observed difference between the data and the null hypothesis it would be more reasonable to conclude that we have a case of disconfirmation especially if we perform many independent tests of our hypothesis and they all give the same 10 result as our reported one i guess most researchers would count the hypothesis as even more disconfirmed statistics is no substitute for thinking we should never forget that the underlying parameters we use when performing significance tests are model constructions our p values mean next to nothing if the model is wrong statistical significance tests do not validate models in many social sciences p values and null hypothesis significance testing nhst is often used to draw far reaching scientific conclusions despite the fact that they are as a rule poorly understood and that there exist alternatives that are easier to understand and more informative not the least using confidence intervals cis and effect sizes are to be preferred to the neyman pearson fisher mishmash approach that is so often practiced by applied researchers running a monte carlo simulation with 100 replications of a fictitious sample having n 20 confidence intervals of 95 a normally distributed population with a mean 10 and a standard deviation of 20 taking two tailed p values on a zero null hypothesis we get varying cis since they are based on varying sample standard deviations but with a minimum of 3 2 and a maximum of 26 1 we still get a clear picture of what would happen in an infinite limit sequence on the other hand p values even though from a purely mathematical statistical sense more or less equivalent to cis vary strongly from sample to sample and jumping around between a minimum of 0 007 and a maximum of 0 999 doesn t give you a clue of what will happen in an infinite limit sequence share on facebook opens in new window facebook share on x opens in new window x share on bluesky opens in new window bluesky förnöjsamhet 27 dec 2020 at 10 01 posted in varia comments off on förnöjsamhet zufriedenheit contentedness contentment contentezza en alldeles för underskattad karaktärsegenskap share on facebook opens in new window facebook share on x opens in new window x share on bluesky opens in new window bluesky o nuit viens apporter à la terre le calme enchantement de ton mystère 25 dec 2020 at 10 58 posted in varia comments off on o nuit viens apporter à la terre le calme enchantement de ton mystère share on facebook opens in new window facebook share on x opens in new window x share on 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