Economics is stuck, dangling between two sides of a chasm. Its left, quantitative, arm reaches for the side of ‘true’ science, while the right limply hangs onto its social origins. However, many economists want to forego their ‘social stigmatisation’ and push their way into the group of physicists, chemists and the like. They have made moves towards the mathematisation of theory and advanced statistical analysis, even creating a fake Nobel Prize for themselves. But does this mean that economics is really becoming a science? Or will economists be left hanging around, discontent, with the sociologists and politicians, longing to be valued as a fully-fledged science?
The main criticism leading some to say that economics could never be considered a true science is its lack of exactitude. When physicists model the physical world that confronts them, their laws and theories can determine facts with high precision, such as when the next comet will be seen passing Earth and where its closest approach will be. Economists openly admit that the subject lacks this ability, and it would be foolish to think otherwise. There is no such thing as a controlled experiment in macroeconomics and it is extremely difficult to find in microeconomics too. There are just too many degrees of freedom, too many factors at play.
Despite this, it would be wise to remember that similar arguments could be made against physics. The age of quantum phenomena, having dawned upon physicists, has plagued their fundamental laws of Newtonian mechanics with probability and statistics – who would have thought that a cat could be considered both alive and dead? Nonetheless, mathematicians and physicists are designing new techniques to deal with this uncertainty, making good use of statistics for support.
Yet these difficulties are underlying in economics: decision-making in the face of uncertainty and hypothesis-testing both form part of the basis for economic theory, but still economists are mocked for their lack of rigour. The same tools developed for dealing with seemingly random actions, in a supposedly physically deterministic world, are being implemented in economics. The analytics of chaos could push the boundaries of both physics and economics. Thus far, it has made a lot of progress and it is set for more to come.
However, even if these arguments persuade you, many of the sceptics' words are well-founded. As a study of humans done by humans, economics is inherently susceptible to bias and experimental error. As the Nobel Prize winning Daniel Kahneman suggests: “We’re generally overconfident in our opinions and our impressions and judgements” and “we’re blind to our blindness”. Economists would do well to remember that a lot of progress at first sight may actually be wrong. But even if the process is two steps forward, one step back, that is still one step towards the truth.
Physics, chemistry, astronomy and the like, were all at one stage considered as lacking rigour and searching for false answers - chemistry originated from alchemy. However, now they have moved to the frontier of rigorous scientific analysis. There may still be some economic pundits who are wrapped up in the business of making the most audacious theoretical suggestions, but likewise there are those physicists who still search for the most elegant theories - such as when dealing with the possibility of multiple universes - and not necessarily correct ones. Even though economics may still have a long way to go from its current state of infancy - first having to rid itself of overconfidence in plausible, but false, theories - some solid advances are being made with the use of statistics. A revamped, more critical, evidence-based approach is also being implemented with good effect. Therefore, many economists are making efforts to separate themselves from those who seek their 5 minutes of fame rather than truth. If they succeed, armed with statistical tools, this subject may yet be able to call itself a science.
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