Sunday, September 17, 2017

David Orrell — Economyths: The Five Stages of Economic Grief

Swiss psychiatrist Elisabeth Kübler-Ross, a pioneer in the field of grief counselling, identified the five stages of grief as denial, anger, bargaining, depression, and acceptance. This extract from Economyths draws on her model of grief as inspiration to chart the long, arduous, but ultimately healthy and healing (we hope, it’s not over yet) process as the economics profession slowly comes to terms with its role in the Great Financial Crisis....
Evonomics
Economyths: The Five Stages of Economic Grief
David Orrell, applied mathematician

3 comments:

Schofield said...

https://www.noexperiencenecessarybook.com/dGw6a/2-the-neurobiology-of-moral-sensitivity-evolution-epigenetics-and.html

AXEC / E.K-H said...

New Economic Thinking = old scientific garbage
Comment on David Orrell on ‘Economyths: The Five Stages of Economic Grief’

Myth, well told, is still the most convincing way to explain how the world and humankind came to be in their present form. To recall, Zeus was the god of sky and thunder. He oversaw the universe, assigned the various gods their roles, and was known for his erotic escapades. Zeus was emotional, spontaneous and had a lot of trouble with other gods, goddesses, and humans. To handle his problems, Zeus regularly fell back to chicanery, force, and violence.#1 Since antiquity, everybody “understands” Zeus and his actions.

Not much has changed since the ancient Greeks. Ninety-nine percent of human communication still consists of storytelling and psychologism. Storytelling and psychologism are scientifically worthless. The “explanation” consists of connecting phenomenological dots by simply imputing a plausible emotional motive (anger, greed, fear, jealousy, hubris, etcetera) to an assumed actor.

The characteristic of science is the rejection of storytelling and the insistence on material and formal consistency: “Research is in fact a continuous discussion of the consistency of theories: formal consistency insofar as the discussion relates to the logical cohesion of what is asserted in joint theories; material consistency insofar as the agreement of observations with theories is concerned.” (Klant)

The goal of science is the true theory. The true theory is the humanly best mental representation of reality. Economics is a failed science. The four main approaches ― Walrasianism, Keynesianism, Marxianism, Austrianism ― are mutually contradictory, axiomatically false, materially/formally inconsistent and all got the foundational economic concepts profit and income wrong. Neither orthodox nor heterodox economists can explain how the economy works and why crises happen.

The methodologically proper measure to overcome scientific failure is a paradigm shift. This, though, is NOT what David Orrell proposes. Instead, he reinterprets the manifest scientific mess as a psychological problem and advocates therapy: “I’m sure there are plenty of sociologists and psychologists (even grief counsellors probably) who can help.”

Needless to emphasize that David Orrell’s story of sickness and healing appeals very much to the ninety-nine percenters who can only understand what is presented in the accustomed sitcom format. Psychologism is the mode of explanation of morons for other morons. Psychology, to recall, is a so-called social science and the so-called social sciences have been debunked by Richard Feynman as cargo cult sciences.

Economics is a system science and the functioning of the economic system has to be explained without recourse to psychological concepts like utility or greed.#2

Economics is a failure ― NOT a psychological or communicative failure but a scientific failure ― and the ultimate cause is not some psychological defect but utter scientific incompetence. Both orthodox and heterodox economics has never been more than storytelling. There is neither material or formal consistency. The representative economist can until this very day not tell what profit is.#3 This is like medieval physics before the concept of energy was properly understood.

Economists have no psychological disorder, they are fake scientists.#4 This scourge cannot be overcome with therapy but only with the immediate expulsion of economists from the sciences.

Egmont Kakarot-Handtke

#1 Wikipedia, Zeus
http://en.wikipedia.org/wiki/Zeus

#2 First Lecture in New Economic Thinking
http://axecorg.blogspot.de/2017/05/first-lecture-in-new-economic-thinking.html

#3 Why economists don’t know what profit is
http://axecorg.blogspot.de/2017/09/why-economists-dont-know-what-profit-is.html

#4 CORE: more lipstick on the dead economics pig
https://axecorg.blogspot.de/2017/09/core-more-lipstick-on-dead-economics-pig.html

Kaivey said...

Good article, Schofield.