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Front Page  Titles (by Subject) Economic Laws - Literature of Liberty, July/September 1978, vol. 1, No. 3
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Economic Laws - Leonard P. Liggio, Literature of Liberty, July/September 1978, vol. 1, No. 3 [1978]Edition used:Literature of Liberty: A Review of Contemporary Liberal Thought was published first by the Cato Institute (1978-1979) and later by the Institute for Humane Studies (1980-1982) under the editorial direction of Leonard P. Liggio.
Part of: Literature of Liberty: A Review of Contemporary Liberal Thought, 20 vols. 19781-982
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Economic Laws
Chapter 8, “Conclusions and Applications.” Microeconomic Laws: A Philosophical Analysis. Pittsburgh, Pa., University of Pittsburgh Press, 1976: 181–215. Microeconomic statements share features common to nomological or lawlike general statements in the natural sciences. Microeconomic statements can thus explain and predict economic events provided that certain antecedent conditions are satisfied. It follows that microeconomic principles qualify as laws in much the same way as do their counterparts in the natural sciences. For a proposition to be a law it must be (a) a lawlike statement, and (b) true. Methodological problems faced by microeconomics resemble those in the natural sciences. Predictive failure does not brand a theory as false or useless. Natural sciences, in fact, betray similar problems without shame. Examples such as Newton's first law (“In the absence of forces acting upon it, a body remains at rest or in uniform rectilinear motion”) exhibit antecedent conditions (the absence of forces) that cannot be realized in the real world; still, no law could serve more usefully. What about the relation between macro and micro economics? The aggregation problem is not unique to economics, since it appears also in the natural sciences. The development of adequate correspondence rules linking micro and macro economics would solve the problem. Until Blotmann, physics could not relate thermodynamics and mechanics. We should not prematurely reject microeconomics for lack of its correspondence with macroeconomics. The motives of the developers of microeconomics need not affect the truth of those laws. Thus, accusations that microeconomics is simply the academic expression of capitalist vested interests, even if true, need not affect the conceptual status of that discipline. Braybrooke's similar accusations to the manner in which motives might corrupt methodology apply equally well to the natural sciences. |
