A Structuralist Theory of Economics
eBook - ePub

A Structuralist Theory of Economics

  1. 222 pages
  2. English
  3. ePUB (mobile friendly)
  4. Available on iOS & Android
eBook - ePub

A Structuralist Theory of Economics

About this book

Economists have long grappled with the problem of how economic theories relate to empirical evidence: how can abstract mathematized theories be used to produce empirical claims? How are such theories applied to economic phenomena? What does it mean to "test" economic theories? This book introduces, explains, and develops a structural philosophy of economics which addresses these questions and provides a unifying philosophical/logical basis for a general methodology of economics.

The book begins by introducing a rigorous view of the logical foundations and structure of scientific theories based upon the work of Alfred Tarski, Patrick Suppes, Karl Marx, and others. Using and combining their methods, the book then goes on to reconstruct important economic theories – including utility theory, game theory, Marxian economics, Sraffian economic theory, and econometrics – proving all the main theorems and discussing the key claims and the empirical applicability of each theory. Through these discussions, this book presents, in a systematic fashion, a general philosophy of economics grounded in the structural view.

Offering rigorous formulations of important economic theories, A Structuralist Theory of Economics will be invaluable to all readers interested in the logic, philosophy, and methodology of economics. It will also appeal particularly to those interested in economic theory.

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Information

Publisher
Routledge
Year
2019
Print ISBN
9781138295643
eBook ISBN
9781351586597

1
Introduction

The project of this book is to provide structuralist rational reconstructions of some economic theories in order to show their logical structure and address their methodological issues. By ‘structuralism’ I understand here a family of meta-theories of the sciences originated in what Muller (2011) has described as the model revolution at Stanford. Muller attributes the paternity of this revolution to Patrick Suppes, but there were prophets that anticipated it.
Actually, just after World War II, the theoretical activity of several economists and logicians at Stanford departed from the standard positivist conception of theories as sets of sentences (typically conceived as sentences of a formalized theory in first-order logic), a conception that can be conveniently labeled the ‘-View’. The motive of the departure was not of an abstract philosophical character, but rather the urgency of formulating with precision mathematized theories relevant to the demands of military intelligence. As Mirowski (2002) reports, Kenneth Joseph Arrow, Samuel Karlin, and Charles Chenoweth (“Chen”) McKinsey, just to mention some of the best-known names, were associated with the work of the Rand Corporation in Santa Monica, California. As a matter of fact, Stanford’s relationship with Rand was so tight that when the latter tried to part with the Douglas Aircraft Company, in 1948, Stanford’s Department of Economics made a bid to absorb Rand (Collins and Kusch 1998: 294 n.; quoted by Mirowski 2002: 299, n. 74). Actually, Mirowski (2002: 299) refers to the Stanford of that epoch as the “major West Coast outpost of military-academic research”.1 What is of utmost importance for this story is that the standard logical methodology of the Stanfordite theoreticians working in military projects was Alfred Tarski’s, as almost all of them were his disciples.
To begin with, Arrow took a course on the calculus of relations with Tarski during the year in which the great Polish logician taught at the City College in New York (1940). Olaf Helmer, who came later to be in charge of recruiting formal logicians in order to do operations research at Rand, translated Tarski’s textbook, while Arrow was in charge of reading the proofs of the translation. There is no doubt (by his class notes) that his way of approaching the preference relation comes from there (cf. Mirowski 2002: 297).
In the autumn of 1950, the young Patrick (“Pat”) Suppes, who had just finished a PhD in philosophy at Columbia University, began to teach at Stanford. Shortly thereafter he met Chen McKinsey, who became his postdoctoral tutor. McKinsey taught Suppes the set-theoretical methods that would eventually make him justly famous but, reports Suppes:
It was not, however, just set-theoretical methods as such that McKinsey taught me but also a passion for clarity that was unparalleled and had no precedent in my own prior education.
(Suppes 1979: 8)
McKinsey told Suppes (with some exaggeration) that “he had learned everything he knew from Tarski”, and encouraged him to attend the seminar that Tarski was giving at Berkeley. Suppes described Tarski as a “ruthless taskmaster” but, above all,
as one of the great examples of the Polish school of logic, […] unwilling to go forward on a single point unless everything covered thus far was completely clear – in particular, unless it was apparent to him that the set-theoretical framework within which the discourse was operating could be made totally explicit. It was from McKinsey and Tarski that I learned about the axiomatic method and what it means to give a set-theoretical analysis of a subject.
(Ibid.)
It was with McKinsey and A. C. Sugar that he wrote his classical paper “Axiomatic Foundations of Classical Particle Mechanics”, which was presented in a rather patronizing way by Clifford Truesdell – a distinguished physicist, above all by his great modesty – who had no qualms in referring to Newton’s crowning achievement ...

Table of contents

  1. Cover
  2. Half Title
  3. Series Page
  4. Title
  5. Copyright
  6. Dedication
  7. Contents
  8. Preface
  9. Acknowledgments
  10. 1 Introduction
  11. 2 Models and structures
  12. 3 The structuralist view of theories
  13. 4 Idealization and concretization
  14. 5 Measurement
  15. 6 A general concept of an economy
  16. 7 Preference and utility
  17. 8 The logical structure of game theory
  18. 9 Abstract labor and labor-value
  19. 10 Classical economics
  20. 11 The logical structure of Sraffian economic theory
  21. 12 The logical structure of econometrics
  22. References
  23. Author Index
  24. Subject Index

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