>I'm actually not a Kuhnian on these issues, but I am trying to see how far
>Kuhn's theory goes in accurately describing economic research. Is it
>really true that there aren't reigning paradigms in meteorology?

That is not what I meant. Of course there is. Its thermodynamics. However, to an 
outsider it looks to impose about as much structure on weather modeling as the notion 
of general equilibrium imposes on macro-modeling - - that is that the devil is in the 
details, big models can be less informative than the careful eye of a specialist in 
local phenomena, and simple models which are consistent with, but not based explicitly 
on physical theory, do almost as well as very big very complex models with a very 
tight relation to the theory. Also, I doubt there has been anything that looks like a 
paradigm shift in meteorology though I suspect there have been changes in "fashion" 
with respect to how weather is predicted.

> I should
>note that experimental econ seems to be developing in a very Kuhnian

In what sense. I would say its inverted. In Kuhn new ideas come into a profession 
because young people feel free to work with them while the dinosaurs continue doing 
what they do. With behavioral economics young people are only now starting to do it 
after a bunch of people with tenure fought like heck for 20 years to get the ideas 

>> the hallmark of modern physics. Sure there are physical problems where
>> chaos and complexity cause the same sorts of problems that economists
>> have dealing with the economy, but they aren't at the core of the
>> discipline the way they are in economics. Thus I think that a lot of
>Some core parts of physics deal with complexity -  how about statistical
>mechanics? Is there a macro counterpart to statistical mechanics?

Not sure what you mean by this, but I suspect that is exactly what the stochastic 
mechanics of the typical general equilibrium model is about. But you miss my point. 
I'm arguing that the phenomena physicists study at the core of the discipline are 
amenable to sufficiently exact theory and exact measurement that you can have decisive 
paradigm shifts driven by anomalous research results. Economic theory is not as 
precise so measurement can't provide the sort of strong evidence that one sees in core 
physics. Of course Kuhn's point is that research results aren't decisive in physics 
either. That anomalous results can always be reinterpreted to fit with the old 
paradigm and that therefore paradigm shift is a social phenomena rather than a purely 
logical phenomena. However, what I'm suggesting is that sharp divisions between 
"paradigms," and paradigm shifts aren't a good way of thinking about how we progress 
in economics. One could say that economics has never had a paradigm shift. !
We went from pre-science to science with the marginalist revolution and have been 
doing normal science ever since. I would argue that pre-1970s macro was fully within 
this tradition within economics though the connections to price theory were verbal 
rather than rigorously theoretical and allowed verbal theorizing about behavior that 
was less than perfectly rational. The changes that took place with respect to 
micro-foundations in the 70s and 80s may look like a paradigm shift but I would argue 
that they are not. The changes preserved the fundamental notion that the economy 
should be thought of as a general equilibrium system with markets moving between 
equilibriums as shocks impact the system. What changed was the specifics of how the 
equations of the general equilibrium model were derived, estimated and rationalized. 
While this didn't represent a sea change in the scientific view of the economy, it did 
represent a sea change in methodology and a sea change in the relative pow!
er of the two main ideological camps in economics. For a while the
models where tight ties to basic price theory ensured welfare results that were 
anathema to interventionist liberals. Since about 1985-1990 things have been swinging 
back the other way with more and more accommodation of rigidities into mainstream 
(academic) models (largely driven by the inability of models without such rigidities 
to fit the data). However, it is my distinct impression that there is still a large 
gulf between practitioners of the different schools. In this sense I think that macro 
is still quite fragmented. Talking about paradigms and paradigm shifts obscures what I 
think is the real dynamic. In the 70s and early 80s a confluence of forces including 
the difficulty Keynesians had with stagflation, but more importantly the internal 
drive of the profession to insist on tight connections between rational actor models 
and empirical research, led academic economists to abandon the old tradition of 
approximating the macro economy with linear equations meant to captur!
e the behavior of different markets without explicit micro foundations. Starting in 
some sense with the failure of rational expectations theory to explain the profound 
real consequences of the contraction of the money supply in the early 80s, the 
continuing inability of rational-expectation/RBC models to account for a wide range of 
empirical phenomena has led to the  incorporation of various institutional and 
behavioral rigidities into models. If I were in a provocative mood I would say that 
modern macro has almost recovered the lost wisdom that it threw away in a misguided 
fools errand that began in the 1970s. Of course it will be nice if we finally secure 
micro foundations for macro economics even if we just end up back where we started. 
However, I will still mourn all the wasted energy and the progress that could have 
been made if we hadn't taken this 25 year side track. 

>Is the difference between monetarists and post-Keynesians smaller than
>between post-Keynseians and Austrians? Austrians don't even accept
>equilibira theory as a starting point of economic analysis.

Post-Keynesians are different from neo-Keynesians. Post-Keynesians are non-mainstream 
leftists with no coherent view of the economy. They are united only in their 
opposition to mainstream economic theory. They play no roll in mainstream economic 
discussions. Its hard to talk about differences between Austrians and post-Keynesians 
since post-Keynesians (at least) have no well enunciated coherent view of economics. 
If you mean neo or new-Keynesians then the differences between them and new-classicals 
(the heirs to 60s monetarism) is minor compared to their differences with Austrians or 
post-Keynesians. But so what? Post Keynesians and modern Austrians play absolutely no 
roll in mainstream economics either in the development of ideas at major universities, 
and in major journals, or in the practice of economics in either important commercial 
forecasting companies or government agencies. They are completely ignored by the core 
of the profession.  - - Bill Dickens

William T. Dickens
The Brookings Institution
1775 Massachusetts Avenue, NW
Washington, DC 20036
Phone: (202) 797-6113
FAX:     (202) 797-6181
AOL IM: wtdickens

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