29 Pages Posted: 1 Nov 2014 Last revised: 29 Apr 2015
Date Written: October 31, 2014
The characteristic capability of science – to turn whatever it might touch into knowledge – seems to have eluded economics. Currently, economists do not understand how the economy works. To get out of the cul-de-sac requires a paradigm shift. It consists in replacing behavioral axioms by structural axioms. The subject matter of theoretical economics is not human behavior but systemic behavior. From the structural analysis follows a new Law of Supply and Demand and a new Profit Law for the economy as a whole. The conventional supply-demand-equilibrium approach is refuted. This implies that the reliance on the spontaneous order metaphor is unfounded.
Keywords: new framework of concepts, structure-centric, axiom set, Profit Law, Law of Supply and Demand, self-adjustment
JEL Classification: B59, B49, D03, D40
Suggested Citation: Suggested Citation