It's certainly impossible for Economics to be a science or a real profession. People who claim to be economists can have 100% clashing views on everything related to economics and they can both claim to be 100% correct. Paul Krugman, for example is supposedly a Nobel Prize winner and some kind of genius, but his ideas NEVER correlate to those of Milton Friedman or other similar economists. Karl Marx was an economist and he certainly thought all of his evil ideas were 100% correct. Keynes ideas are always bounced around as well as "Austrian" economics. And none of these people or theories solve any problems.
It would be like the medical profession saying that it's perfectly fine for some doctors to say that the cure for diabetes is aspirin and another say the cure is to be obese and another say the cure is to be thin.
All professions, in accounting, medicine, law, engineering, nursing, etc have principles that always work and if you deviate, you wind up with a bridge that falls down or a patient that dies or you get sued for malpractice, etc. There might be some experimentation on the side and a few bad decisions, but the science is quite hard and firm. Not with economics.
So why should we trust our entire planet and economy on the ideas of a few pinheads who think they have the right to control everyone's money? Especially when their theories are all bull shyt?
SDD
First of all, Paul Krugman is no longer an economist; he's a pundit (and a bit of an embarrassment to real economists). But that aside, I think you'll find that the majority of economists are quite aligned on a few core empirical observations -- one of which is that markets tend to be the most efficient way to allocate resources. This is not really a matter of great dispute. Where "experts" get in trouble is when they decide they want to engineer different results than those that occur when people are free to make individual, voluntary decisions. To take a painful recent example, the EFFICIENT allocation of resources would not result in two-thirds of the population owning their own home. But some Wise Men in Washington decided that they didn't like this result and that they could increase home ownership by subsidizing it in various ways (tax preferences, mortgage guarantees, etc.). Guess what happened. Quite predictably there was an asset "bubble" in real estate. Most economists could tell you that was inevitable, but, then, they're not the ones making "policy". being economically ignorant has never been a disqualification for holding office. In fact, understanding eocnomics is usually a hindrance in that you have to tell people truths like "there is no Free Lunch". That's not what voters want to here. They like "theories" that have lots of benefits and no costs.
Matt
You seem very disillusioned with Economics. I love this stuff so I'll try providing you with a satisfying answer.
Economics is a relatively young science. And the reason people can have such differing views on it is because of how complex it is. You're simplifying it by comparing it to professions like medicine and other "hard" sciences. Those subjects have been studied for MUCH longer than economics has been studied. Also, hard scientists (Biologist, Chemist, Physicist etc), can conduct controlled experiments and base their theories and laws on the results of these experiments. Economist cannot simply say, "today, let's inflate the nation's money supply by 5,000,000% and see what happens to the economy. The most likely outcome is that it would cause hyperinflation and destroy the economy but we know this based on history and observing other countries' mistakes, not based on experiments. One of the hardest parts of economics is that it is based on people's rational ideals. For instance, you wouldn't pay $ 1000 for a can of pepsi would you? of course not. However, people are unpredictable and there is a very large psychological component to economics. Makes sense since an economy is make up of people right? This makes economics unpredictable because the actions of a small group of people (say, Ben Bernanke or Wall Street traders) can wildly move markets. Even consumers even have this effect. If every consumer in the US refrained from buying anything for one day, there'd be worldwide panic and the world economy would probably fall into recession. Obviously this is a highly unlikely scenario but. to a lesser extent, this is what happens in the real world. It Happened with the oil embargo of the 1970s, the dot-com bust of the 90s and housing in the late 2000s. How would anyone know in advance that OPEC was going to reduce oil supply in the 70s thus driving up the price? Furthermore, how would they know how it affects the economy if it never really happened before to that extent? Remember friend, there are no controlled experiments to tell economists what will happen and how to react to it.
Generally, modern economic thought began with Adam Smith when he wrote the "Wealth of Nations." This was the basis for "laissez faire" economics. Today every country in the world has a mixed economy, that is, some free market aspects and some socialist aspects. So you might want to take back what you said about Marx being evil. Stick with facts, not opinion. I'm no socialist and I do have respect for the free market, but I personally believe that a pure capitalism leads to inequalities and market failure while pure socialism leads to inefficient allocation of resources. A mix of the two is best and has given us the highest standard of living.
AreJay
Economics is not a profession at all, like you said, it is an area of academic study. Of course things like market and policy analysts use economics to inform their decisions economics certainly isn't a professional area of study like nursing, medicine, or law.
However, as one other poster said there are a number of things that economists almost universally accept (like absent externalities the efficiency of free markets) while they still fight on other things. This has been seen in other sciences before the correct theories have been hammered out though long processes. How many people do you think agreed with Einstein before he gained significant evidence and how many people do you think just bought into quantum physics right away (essentially pushing Newtonian physics to the wayside)?
Also it is naive to think that economics have never solved any problems. Ricardo proved that specialization and trade among nations along comparative advantages can lead to higher wealth in both countries, the opening up of trade has lead to much of the growth of the modern age. Economists were the first to discover how capital is as much a factor of production as labor or land and capital accumulation is the reason were are not living in the conditions of the 16th century. People today are hardly just naturally better workers than previous generations they have more and better tools to work with. Economists, namely Adam Smith, demonstrated how by allowing people to act in their own self interest the common good was served through his "invisible hand" analogy demonstrating freedom as a good, not just a better evil than state control. Economists have also been the ones who have argued that what is important is the happiness and wellbeing of citizens not gold in gov't vaults or military power.
All in all you do, however, have a point; in the areas of economics that are not well understood and well based on the past, policy makers should be careful because the real world acts differently than economists' models very often. The parts of economics that is well understood however, such as the idea that markets are efficient were possible and people will maximize their own utility without interference, that externalities need to be taken into account, that free trade raises incomes for both sides, and other well developed and proven findings can be used to inform the people that make policy.
ronald.glass@sbcglobal.net
Extremely astute on your part- well analyzed and well written. It is because it is NOT AN EXACT SCIENCE BUT A SOCIAL SCIENCE. In addition, it is extremely complex even employing many mathematical models and econometric models to predict or explain with often times very convincing but totally inaccurate answers. It is still in it's infancy compared to exact sciences. Economies existed from beginning of time but formal study and understanding didn't start until about the time of Adam Smith.
probed
I think you have hit the nail on the head;Other hard sciences like Physics,Chemistry and Maths at least work in 90 % of the cases whilst economics is a fraudulent subject because look at the foundation of this vague science.It says ceteris paribus which translates itself into "other things being equal".So when there are a multitude of parameters and inputs it is really hard to predict the course of the economy or any direction in either macro economics or micro-economics.These can only be trends or possiblities that may happen;there is no rule that they will happen.
The blame lies with the American politicians and their nexus with Wall-street to make economics appear as if it was a super science and put economists on a high pedestal.This is obviously done to hoodwink the masses and make money for themselves in the process.
YES SIR I do agree that economics is a fraud and it is one thing to know the the fundas but to place too much reliance on these theories is tom foolery.
bvgopinath2001
The right definition of economics would have been "Study of nature, composition, properties, laws and classification of wealth". Economists must study wealth the way chemists study matter. Law of Conservation and Law of Equilibrium, the general laws of wealth are totally neglected. Economists state that wealth can be created but in double entry bookkeeping for every debit or credit there ought to be credit or debit of like amount and this means that wealth can neither be created nor can it be destroyed but can be changed from one form to another. Is loss wealth? If not, why is it expressed or measured in units of wealth? If loss is wealth, is it scarce and does it have value-in exchange, the properties economists state as prerequisites for wealth? Economics is closely related to chemistry and is a material science. Unfortunately they have chosen a wrong path. This is the reason why they were clueless about economic downturn or global recession.
Orignal From: Is Economics, in general, a fraudulent hoax?
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