Is Mainstream Economics a Science Bubble?

Forthcoming in Review of Political Economy

21 Pages Posted: 4 Oct 2017  

John B. Davis

Marquette University; University of Amsterdam; Tinbergen Institute

Date Written: October 3, 2017

Abstract

This paper uses George Soros’ theory of boom--bust cycles to argue that mainstream economics, as built on Samuelson’s Foundations, followed such a cyclical prototype. It underwent a reflexive, positive feedback pattern of development before 1980 followed by a reflexive, negative feedback pattern of development after 1980, and that this makes it a science bubble. The positive feedback pattern was associated with the “misconception” that when economics is framed as a natural science as per Samuelson, it improves its descriptive capacities as a science; the negative feedback pattern was associated with increasing recognition that this was a “misconception” and the emergence of mainstream economics’ performative ambition – the idea that economics aims to construct the world in its own image rather than describe it. The paper discusses how this latter aim is embodied in later game theory, ‘new’ behavioral economics, and mechanism-design theory. Yet the vision of economics as a performative science is inconsistent with Samuelson’s natural science model of economics. Thus, mainstream economics turns out to be a science bubble much like many other mistaken, superseded research programs in the history of science.

Keywords: reflexity, science bubble, Soros, Samuelson, recent economics

JEL Classification: B21, B41, G01

Suggested Citation

Davis, John B., Is Mainstream Economics a Science Bubble? (October 3, 2017). Forthcoming in Review of Political Economy. Available at SSRN: https://ssrn.com/abstract=3047426

John B. Davis (Contact Author)

Marquette University ( email )

P.O. Box 1881
Milwaukee, WI 53201-1881
United States

University of Amsterdam ( email )

Amsterdam
Netherlands

Tinbergen Institute ( email )

Burg. Oudlaan 50
Rotterdam, 3062 PA
Netherlands

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