Lars P. Syll — What makes a good explanation in economics?

Philosophy of economics and social science, or do you know what you are doing? Economists especially attempt to emulate or even mimic physics, but the social sciences are inherently different from the natural sciences because the subject matter is inherently different. Therefore, explanation will be different in the social sciences, including economics, than it is in the natural sciences.

Lars puts forth a realist theory in opposition to positivist and subjectivist theories. These are the dominant theories at present, but they are not the only possible ones, such as semiotic, pragmatist and idealist. All of these views have something to contribute, and none of them has proved itself to be so compelling as to exclude the others. History shows that different approaches exchange dominance. This is as a result of changing context, and it also shapes context.

Lars asserts that only one approach is to be preferred as optimal, otherwise relativism results, and that approach is "realism." In the absence of an absolute criterion, I don't see "relativism" as a problem. Lars would say that "reality" is that criterion, but what "reality" may be is one of the perennial questions on which there is no universal agreement, and some (Ludwig Wittgenstein) hold that the question is not answerable at all in that this lies beyond the limits of language to capture.

Then there is the idealist view expressed by Max Plack based on his view of quantum mechanics as foundational:

I regard consciousness as fundamental. I regard matter as derivative from consciousness. We cannot get behind consciousness. Everything that we talk about, everything that we regard as existing, postulates consciousness. • As quoted in The Observer (25 January 1931)

"As a man who has devoted his whole life to the most clear headed science, to the study of matter, I can tell you as a result of my research about atoms this much: There is no matter as such. All matter originates and exists only by virtue of a force which brings the particle of an atom to vibration and holds this most minute solar system of the atom together. We must assume behind this force the existence of a conscious and intelligent mind. This mind is the matrix of all matter." • Das Wesen der Materie [The Nature of Matter], speech at Florence, Italy (1944) (from Archiv zur Geschichte der Max-Planck-Gesellschaft, Abt. Va, Rep. 11 Planck, Nr. 1797)

"Science cannot solve the ultimate mystery of nature. And that is because, in the last analysis, we ourselves are part of nature and therefore part of the mystery that we are trying to solve." • Where is Science Going? (1932)

From Wikiquote.

Lars P. Syll's Blog
What makes a good explanation in economics?

Lars P. Syll | Professor of Social Studies and Associate professor of Economic History at Malmö University