Monday, March 7, 2016

Maria Alejandra Madi — The formal and the substantive meanings of ‘economics’

Conventional economics is formalistic and deal with homo economicus, whose sole reality is as a set of restrictive assumptions as the basis of a particular style of formal modeling.

Some heterodox economics, economic sociology, and economic anthropology are substantive and deal with homo socialis, whose reality is as a conceptual model based on empirics.When differences arise in conceptual models the appeal is not to intuition or definition, but rather to observation and data.

Real-World Economics Review Blog
The formal and the substantive meanings of ‘economics’
Maria Alejandra Madi

1 comment:

jrbarch said...

Hover a km. above a city. Where is the economy? Where indeed, is the city? What is the activity? Stay there and contemplate it awhile.

The ‘city’ is sensory input to the brain; electrochemical signals, data input dependent upon the attention and clarity of perception, updating the ‘real city’ our ‘model’ that is (according to neuroscientist Dr David Eagleman) stored in our brain. Its meaning and significance to us are both learnt and fabricated. It is the brain that creates the sounds, colours, smells, touch, and tastes; thoughts and emotions - that bring to life your model (a.k.a. your ‘reality’ - in David’s view). On this electrochemical stage the ‘I’ is exuded, and acts out its little role in the world.

No wonder we feel like we are swimming in a soup sometimes. Or maybe it was the wine and truffles?

So, why should your ‘city’ be the same as mine? Why should what you identify as the economy of your city be the same as what I identify as the economy of my city? Is all of that activity that goes on in the city all about our ‘economy’; or is it really about something else? When we get to rules and regulations to run this economy, differences in our models will diverge even further. What do you want from your city and economy – are you getting it? What do our ‘dear leaders’ in whose 1.3kg of grey matter and electrochemical static, exists the lila of countries and statesmanship - want? Obviously they are not getting it. The fight exists in their brains, in their internal models, and spills out into the external world. Perhaps they need medicating to calm the electrochemical waveforms? ‘Mandatory Valium for serene politicians’ – I’d vote for that.

As an aside, I identify the Law of Economy as a characteristic of matter; ruled by Force (energy in matter) which in turn is ruled by Energy (Consciousness or Life). For me, the human economy is a pursuit of atoms and experience that updates our ‘reality’. But reality exists neither in the mind or the brain. Cannot be created by the mind or the brain. Reality existed long before even the Universe(s) took shape and that same reality is our essence too. Therefore it is accessible to us. I think knowing that, experiencing that matters. This is a part of human history too.