Dat inequality

[a500lbgorilla]

Hey wuf,

I see where you're coming from. I prefer to think of it myself as understanding the build and where it works and where it doesn't work.

[wufwugy]

Hey wuf,

I see where you're coming from. I prefer to think of it myself as understanding the build and where it works and where it doesn't work.

Think of it like evolution. Natural selection exists because individuals mutate and choose breeding partners, and this all happens within large populations. The market mechanism is the same. Individuals acting freely and with self-interest within a population of others doing the same creates an evolving competitive market

[a500lbgorilla]

Think of it like evolution. Natural selection exists because individuals mutate and choose breeding partners, and this all happens within large populations. The market mechanism is the same. Individuals acting freely and with self-interest within a population of others doing the same creates an evolving competitive market

Any system will evolve given rules and time. The reason we can speak about evolution so robustly is because we can apply the scientific method to it. Economics is not the same and it cant be studied the same way.

So it's an evolving system, sure, but you can't think of it like evolution.

[wufwugy]

Any system will evolve given rules and time. The reason we can speak about evolution so robustly is because we can apply the scientific method to it. Economics is not the same and it cant be studied the same way.

So it's an evolving system, sure, but you can't think of it like evolution.

I don't mean that the system evolves, but that the system functions similarly to biological evolution. The dynamic of natural selection isn't much different characteristically than what we could call consumer selection or product selection or whatever. Simplifying evolution, we have two factors: environment and mutation. These factors interact and the most able to succeed do while the others die. This doesn't create perfect specimens. Instead it creates all sorts of whack specimens. But our attempts to engineer something better with similar complexity has come as close to success as a doberman is to inventing wormhole travel.

Markets are the same. Two factors: production and consumption. They interact for a spell then the companies and consumer behavior that is most able to succeed, does. If we're sticking to this analogy, government is sorta like eugenics. Wherever it regulates, it chooses the winners and losers, not based on their own merits, but based on arbitrary concerns of the government and effects (predicted or unpredicted) of the regulations.

[a500lbgorilla]

I don't mean that the system evolves, but that the system functions similarly to biological evolution. The dynamic of natural selection isn't much different characteristically than what we could call consumer selection or product selection or whatever. Simplifying evolution, we have two factors: environment and mutation. These factors interact and the most able to succeed do while the others die. This doesn't create perfect specimens. Instead it creates all sorts of whack specimens. But our attempts to engineer something better with similar complexity has come as close to success as a doberman is to inventing wormhole travel.

Markets are the same. Two factors: production and consumption. They interact for a spell then the companies and consumer behavior that is most able to succeed, does. If we're sticking to this analogy, government is sorta like eugenics. Wherever it regulates, it chooses the winners and losers, not based on their own merits, but based on arbitrary concerns of the government and effects (predicted or unpredicted) of the regulations.

You're missing a rather subtle point. There is a reason why our understanding of evolution is robust and predictive in ways that our understanding of economics isn't.

We have a mechanism to calibrate our modeled understanding of evolution. It's the mechanism that allows us to discover and describe genetics. We can guess and check via the scientific method. Which is not something you can do with economics. Because you can't experiment with an economy like you can with living organisms. Economies are hard to observe, hard to isolate, hard to play with.

Science has a way to discover the mechanism of heredity/mutation/speciation - DNA. Economics does not yet have a way to discover the mechanism of the invisible hand/benefitial competition/whatever we're doing.


From VS Ramachandrans explanation of Crick and Watson's discovery of DNA


"It is well known that Crick and Watson unraveled the double helical structure of the DNA molecule: two twisting complementary strands of nucleotides. Less well known is the chain of events culminating in this discovery.


First, Mendel's laws dictated that genes are particulate (a first approximation still held to be accurate). Then Thomas Morgan showed that fruit flies zapped with x-rays became mutants with punctate changes in their chromosomes, yielding the clear conclusion that the chromosomes are where the action is. Chromosomes are composed of histones and DNA; as early as 1928, the British bacteriologist Fred Griffith showed that a harmless species of bacterium, upon incubation with a heat-killed virulent species, actually changes into the virulent species! This was almost as startling as a pig walking into a room with a sheep and two sheep emerging. Later, Oswald Avery showed that DNA was the transformative principle here. In biology, knowledge of structure often leads to knowledge of function—one need look no further than the whole of medical history. Inspired by Griffith and Avery, Crick and Watson realized that the answer to the problem of heredity lay in the structure of DNA. Localization was critical.


Crick and Watson didn't just describe DNA's structure, they explained its significance. They saw the analogy between the complementarity of molecular strands and the complementarity of parent and offspring—why pigs beget pigs and not sheep. At that moment modern biology was born."


Ain't nothing like this in any of the economic literature I've ever seen. And if there is, I desparately want to read it.

I hesitate to make this point because it becomes a very harried discussion from here on out that calls back to the philosophy of science that no one in their right mind would want to get in to, but this is the core of my difficulty with economics. I know why I can trust the theoretical explanations underlying the behavior of planes, but not why I should trust similar explanations for the behavior of unregulated free markets.

[wufwugy]

You're missing a rather subtle point. There is a reason why our understanding of evolution is robust and predictive in ways that our understanding of economics isn't.

We have a mechanism to calibrate our modeled understanding of evolution. It's the mechanism that allows us to discover and describe genetics. We can guess and check via the scientific method. Which is not something you can do with economics. Because you can't experiment with an economy like you can with living organisms. Economies are hard to observe, hard to isolate, hard to play with.

Science has a way to discover the mechanism of heredity/mutation/speciation - DNA. Economics does not yet have a way to discover the mechanism of the invisible hand/benefitial competition/whatever we're doing.


From VS Ramachandrans explanation of Crick and Watson's discovery of DNA


"It is well known that Crick and Watson unraveled the double helical structure of the DNA molecule: two twisting complementary strands of nucleotides. Less well known is the chain of events culminating in this discovery.


First, Mendel's laws dictated that genes are particulate (a first approximation still held to be accurate). Then Thomas Morgan showed that fruit flies zapped with x-rays became mutants with punctate changes in their chromosomes, yielding the clear conclusion that the chromosomes are where the action is. Chromosomes are composed of histones and DNA; as early as 1928, the British bacteriologist Fred Griffith showed that a harmless species of bacterium, upon incubation with a heat-killed virulent species, actually changes into the virulent species! This was almost as startling as a pig walking into a room with a sheep and two sheep emerging. Later, Oswald Avery showed that DNA was the transformative principle here. In biology, knowledge of structure often leads to knowledge of function—one need look no further than the whole of medical history. Inspired by Griffith and Avery, Crick and Watson realized that the answer to the problem of heredity lay in the structure of DNA. Localization was critical.


Crick and Watson didn't just describe DNA's structure, they explained its significance. They saw the analogy between the complementarity of molecular strands and the complementarity of parent and offspring—why pigs beget pigs and not sheep. At that moment modern biology was born."


Ain't nothing like this in any of the economic literature I've ever seen. And if there is, I desparately want to read it.

I hesitate to make this point because it becomes a very harried discussion from here on out that calls back to the philosophy of science that no one in their right mind would want to get in to, but this is the core of my difficulty with economics. I know why I can trust the theoretical explanations underlying the behavior of planes, but not why I should trust similar explanations for the behavior of unregulated free markets.

I think economics is more robust than you think, but you are correct that social sciences are the least of the experimental. Any step less experimental and it looks like humanities and art

However, there is a load of data and theory in economics. There's still a lot of algebra and consensus views. As far as I can tell, the technical stuff is almost never discussed by any who are not themselves hardcore economics academics. A big part of the reason why people think economics is lacking in any level of robustness is two things: (1) most trained in economics are in micro, not macro, and macro is very different than micro. (2) It's political. Even trained academics let their politics override way too often

Regardless, I think the public vastly overestimates the disagreement between PhDs. There's a lot of consensus, but few people listen