The Economic Crisis and its Implications for The Science of Economics

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Fidel

They're just trying to be helpful, Pete. They're not nit-picking jackasses all of the time.

Cueball Cueball's picture

Not really. I really like the fact that Peter is not one of those posters who nitpicks about his posts, and furiously bangs them out at high speed without checking for errors. Given the speed at which these typos suggest he is writing at, his thought are pretty clear, his grammar excelent. Full marks. Bang it off and be done. So what if you have to wade through some mistyping? And as in the case of the "Middle English" above, its sometimes even charming.

Mots peopel haev no prolbmes redaing throuhg wodr jumbels becasue tehy idenfity the wrod as whole, and stopped redaing wodrs phoneticly sylable by sylabel when they were chidlren, maikng sense of the words in context as well. People react to typos mostly because it contravenes a certain officious sense of propriety.

Keep banging away Peter and fuck the spell check. Fast and furious. Its a post on a message board, not a university thesis.

Spectrum Spectrum's picture

Cueball,  what kind of advice is that?

After that "stream of consciousness writing" has unfolded and you feel okay with it,  what's it take to run a spell checker afterword?

Best,

Cueball Cueball's picture

Who cares, I can read it. So can you. So what. He's obviously flying along at insane keyboard speeds. No need to make an issue of it because most people stopped reading sylable by sylable long ago, capturing the meaning of words instantly as icons, and making sense of sentences by context and content.

Peter is a good writer, and you can see that his hand connect almost instantly with his thoughts, and they just spill out in clear and meaningful manner, hence the first comment on that typo-filled passage was: "Thank you for those Plain and Elegant words."

docjmd

Well I just got booted offline b/4 i could finish my message

As the poster who used the phrase "Thank you for those Plain and Elegant words" I was simply trying to say that English grammar and syntax are not my primary determinants of a person's intelligence, common sense or Value as a contributor.

The Ivy Covered Buildings of Academia are full of "Educated Assholes" who have the common sense of an earthworm and the manners of a constipated sow.

This thread is degenerating from it's original noble purpose. SAD.

 

peterjcassidy peterjcassidy's picture

Sorry for my bad presentation - I needed to be brought up on that. Embarassed Let the thread flow back to its purpose, which  I understand to be  discussing to what extent economics can be considered a science, particularly given its inadequacies in predicting and describing the economic crisis. Part of that discussion could involve the difference between "hard" science (physics, mathematics, engineering?) that deals with certain forces that can be accurately charted and the "soft" sciences (history, sociology, economics) that deal with complex unpredictable humans

docjmd

Peter, I don't have all the answers either. But your suggestion re comparing the "hard" and "soft" sciences is a really good  STARTING POINT!

You would hardly believe the number of people I know that had to go through econometric hoops, even though it had nothing to do with the objective of the Ph.D Dissertation. 

Let me know if U WOULD LIKE TO PURSUE THIS FURTHER

 

SINCERELY,

JEFFREY 

Fidel

I think the poor around the world are beginning to realize that things just dont improve for them with capitalist globalization. On the news the other night, getto dwellers of Dharavi, India's largest slum, are refusing to be moved from their slum in making way for real estate developers. One man and his family began making pottery and rose a bit above the average situation of grinding poverty there. He realizes that if he has to move out of his slum dwelling, he wont be able to make pottery in any kind of volume in an apartment building. The squatters of Dharavi have the new liberal capitalism pegged for what it really is.

peterjcassidy peterjcassidy's picture

docjmd wrote:

Peter, I don't have all the answers either. But your suggestion re comparing the "hard" and "soft" sciences is a really good  STARTING POINT!

You would hardly believe the number of people I know that had to go through econometric hoops, even though it had nothing to do with the objective of the Ph.D Dissertation. 

Let me know if U WOULD LIKE TO PURSUE THIS FURTHER

 

SINCERELY,

JEFFREY 

Some discussion on this site would be good. I assume you are into scenario planning-somewhere around Club of Rone  and the Rise and Fall of Great  Powers?

George Victor

Forget the crisis, fells.  Wall Street has just solved it.

 

The New York Times reports this morning:

 

"After the mortgage business imploded last year, Wall Street investment banks began searching for another big idea to make money. They think they may have found one.

The bankers plan to buy "life settlements," life insurance policies that ill and elderly people sell for cash - $400,000 for a $1 million policy, say, depending on the life expectancy of the insured person. Then they plan to "securitize" these policies, in Wall Street jargon, by packaging hundreds or thousands together into bonds. They will then resell those bonds to investors, like big pension funds, who will receive the payouts when people with the insurance die.

The earlier the policyholder dies, the bigger the return - though if people live longer than expected, investors could get poor returns or even lose money.

Either way, Wall Street would profit by pocketing sizable fees for creating the bonds, reselling them and subsequently trading them. But some who have studied life settlements warn that insurers might have to raise premiums in the short term if they end up having to pay out more death claims than they had anticipated.

The idea is still in the planning stages. But already "our phones have been ringing off the hook with inquiries," says Kathleen Tillwitz, a senior vice president at DBRS, which gives risk ratings to investments and is reviewing nine proposals for life-insurance securitizations from private investors and financial firms, including Credit Suisse.

"We're hoping to get a herd stampeding after the first offering," said one investment banker not authorized to speak to the news media.

In the aftermath of the financial meltdown, exotic investments dreamed up by Wall Street got much of the blame. It was not just subprime mortgage securities but an array of products - credit-default swaps, structured investment vehicles, collateralized debt obligations - that proved far riskier than anticipated.

The debacle gave financial wizardry a bad name generally, but not on Wall Street. Even as Washington debates increased financial regulation, bankers are scurrying to concoct new products.

In addition to securitizing life settlements, for example, some banks are repackaging their money-losing securities into higher-rated ones, called re-remics (re-securitization of real estate mortgage investment conduits). Morgan Stanley says at least $30 billion in residential re-remics have been done this year."

And so it goes. (Vonnegut)

neil_smith neil_smith's picture

I remember listening to Nobel prize winning economist Robert Mundell on CBC Morningside a number of years ago. His horrific acceptance of the inevitability of at least 10% of people living in poverty for all time, prompted me to respond:-

"How appropriate to have Robert Mundell on your Haloween show. He ended goulishly with the statement "..there will always be poor people..." 10% was his declared norm. I could picture him sitting in your studio wearing his grim reaper outfit condemning billions of people for centuries hence to miserable lives of abject poverty. He described the thrill he gets from fitting mathematical models to economic activity, yet has failed to grasp the simple model of global injustice. His example of Bill Gates obscene accumulation of wealth explains clearly why there are poor people today. It does not explain why there always needs to be poverty.

Awarding Robert Mundell a nobel prize has put the credibility of nobel awards in doubt. Although the credibility of most economists is in serious doubt at the best of times."

It is time we woke up from this permanent halloween nightmare of accepting that 1 in 10 people are poor and that we can do nothing about it.   

 

I have seen little, in the intervening period, from most economists, to improve my opinion of their economic models. Models that have more to do with alchemy, perpetual motion machines or the Ponzi scheme economic equivalents.

Spectrum Spectrum's picture

Fortunately, I'm not an economist.:) Tried looking for the article. Any idea under what heading?

 

While one can know about Newton's "other interests" he still sought to live his life according to science in his "other forms of research?"

M. Spector M. Spector's picture

neil_smith wrote:

I remember listening to Nobel prize winning economist Robert Mundell on CBC Morningside a number of years ago. His horrific acceptance of the inevitability of at least 10% of people living in poverty for all time, prompted me to respond:-

"How appropriate to have Robert Mundell on your Haloween show. He ended goulishly with the statement "..there will always be poor people..." 10% was his declared norm. I could picture him sitting in your studio wearing his grim reaper outfit condemning billions of people for centuries hence to miserable lives of abject poverty. He described the thrill he gets from fitting mathematical models to economic activity, yet has failed to grasp the simple model of global injustice. His example of Bill Gates obscene accumulation of wealth explains clearly why there are poor people today. It does not explain why there always needs to be poverty.

Awarding Robert Mundell a nobel prize has put the credibility of nobel awards in doubt. Although the credibility of most economists is in serious doubt at the best of times."

It is time we woke up from this permanent halloween nightmare of accepting that 1 in 10 people are poor and that we can do nothing about it.

I have seen little, in the intervening period, from most economists, to improve my opinion of their economic models. Models that have more to do with alchemy, perpetual motion machines or the Ponzi scheme economic equivalents.

There is intelligent life in this thread after all!

Fidel

neil_smith wrote:
I have seen little, in the intervening period, from most economists, to improve my opinion of their economic models. Models that have more to do with alchemy, perpetual motion machines or the Ponzi scheme economic equivalents

I think youre more disappointed in the politicos in North America's two-four old line parties running things into the ground for the last 30 years and more with neoliberal capitalism. Wall Street and bay Streeters don't buy economists so much as they buy whole stoogeocracies every four years.

 

To suggest that "this", what we have here in Canada and the US,  is the way it is around the world in general is false and misleading.  

 

Canadian William Krehm quotes Frances Hutchinson describing the [url=http://www.comer.org/2004/2004b/Bus.htm]"Stalinization" of economic theory[/url] in 1990's USA and Canada with history of economic thought particularly targeted.

docjmd

You are right on point.

 

Jeffrey

Spectrum Spectrum's picture

Quote:
As I see it, the economics profession went astray because economists, as a group, mistook beauty, clad in impressive-looking mathematics, for truth. Until the Great Depression, most economists clung to a vision of capitalism as a perfect or nearly perfect system. That vision wasn’t sustainable in the face of mass unemployment, but as memories of the Depression faded, economists fell back in love with the old, idealized vision of an economy in which rational individuals interact in perfect markets, this time gussied up with fancy equations. The renewed romance with the idealized market was, to be sure, partly a response to shifting political winds, partly a response to financial incentives. But while sabbaticals at the Hoover Institution and job opportunities on Wall Street are nothing to sneeze at, the central cause of the profession’s failure was the desire for an all-encompassing, intellectually elegant approach that also gave economists a chance to show off their mathematical prowess.See:How Did Economists Get It So Wrong?

 

Spectrum Spectrum's picture

Glad Peter took it in stride. I do recognize the "creative intent" writers like to induce.:)

 

siamdave

Everyone's in a box. Out of the box, we see this. First, Krugman and Keynes might be 'liberals', but that is a labelling trick you need to be careful of, and don't go running to them or quoting them when the big bad laissez-faire gang come marauding (laissez-faire basically means the big guys do as they like, and you shut up or we'll lay a beating on you), as they won't help with anything really useful beyond some kind of soma to lessen the pain. They are both also capitalists, benefitting from the capitalist system (one might even say flunkies) - capitalists light, perhaps, but still capitalists. Think of 'good cop bad cop' - you might have a carrot in your hand from the good cop, but you're still going to jail. And with capitalists light running things, as they did for a few years after the last huge meltdown the serious capitalists caused in '29, your masters might treat you a little better as they get you back under control when you're showing some small signs of 'this is freaking enough, you guys!!!', but you will still be powerless peasants in the capitalist system, which, basically by definition, requires a few wealthy capitalist-masters controlling the serious 'capital' and a great herd of powerless workers manning their factories and businesses producing that capital.

(Out of the box, as an aside, you need to get a bit better grip on what 'capital' actually is - it is not just money or property, although it can be either and is somewhat fluid, able to transfer from one to the other - but serious 'capital' is essentially the 'excess wealth' produced by workers beyond their daily subsistence - in a (true) 'socialist' system, we somehow arrange for that excess wealth to be stored in some kind of communal storehouse for 'our' use in the future - in a 'capitalist' system, the 'owners of production' claim that excess production for themselves, and the peasants just keep going to work, day after day after day - like a milkcow or something - never realising any benefit from their labour beyond some kind of bare subsistence - it's a too-long story for a short comment, but that's the basic situation.)

Modern 'economists' are either complete fools or complete traitors, it's hard to go anywhere else when you understand what is happening in our world, and the economic basis of pretty much everything nowadays (they can be well-meaning fools, but still supporting the system that enslaves us all). We can leave the fools as unworthy of much attention, but for the traitors, the big thing is the central lie they all propagate, primarily by omission, and by confusing the situation with a cornucopia of complicated but meaningless 'equations' - the single most important factor of modern political economics (and, as the man said, make no mistake about it, modern 'economics' is 100% about politics, which is the main reason they disconnected the words a hundred or so years ago, to conceal this) - the single most important fact is (drum roll!! -) money!!

You need to think about this a bit, or maybe a lot - it is all about money - but where does that money come from? The one central fact of our modern world, which is, it is no secret, controlled by money, is that that money is created almost entirely by private banks, for private profit, with essentially no serious government regulation. The bills and coins in your wallet that you use for day-to-day stuff is created by the government - and is about ~5% of our 'money supply' - the rest is various forms of electronic money, which is created entirely by the banks as loans, and which they demand and get 'interest' on - every year. Endless interest on our money supply. And when you grok that fully, pretty much everything else becomes clear. In a society based on money, he who controls the money, controls everything else. And they are not exercising that control for 'your/our' benefit. And this is the one thing our 'economists' refuse (or are too indoctrinated - the 'fool' segment) to deal with.

The second major (and very much related) problem with modern 'ecomomists' is their insistence on living in some fantastical wonderland where everyone is some kind of honest robot, dealing in mathematically countable ways as they do their daily business - but the most salient fact of life in capitalistland is not the fact that most of us are honest citizens and workers and consumers, but that we are being run by a bunch of crooks, scamming us every way they can think of through their control of the money we all use for our daily transactions - and if 'economists' will not even acknowledge this in their theories, let alone try to devise some explanations about how this central dishonesty works through our economies, then the chance of any useful analysis of what is happening is zero.

I won't take up more time or space getting into details here - I've written a longer piece that gets into the first part of it all, the private money creation bit, a bit more here - Global Financial Meltdown: Forces beyond our control, or the greatest scam ever?
http://www.rudemacedon.ca/greatest-sting-ever.html - but if anyone has any comments etc (beyond the simplistic name-calling any talk of monetary reform usually elicits from apologists for their capitalist masters), I'll try to answer them.

 

Fidel

I think that economic Liberals have been very laissez-faire, even since the 1930's and 40's. William Beveridge only found the political will to implement his ideas for welfare state among British Labour. In 1930's Canada, the depression raged on through Tory and Liberal rule with no end to economic and social decay and rot in sight. The Mackenzie King Liberals only nationalised the Bank of Canada after being pressured to by the CCF, and after decades of playing follow the leader with second-hand ideology emanating from the US even then.

And today, political Liberals are lost as to who to look to for advice and which country of economic Darwinism to emulate. Their entitlement mind set, like Tories,  tells them to continue hitching Canada's economic wagon to the USA's fortunes as their eyes light up at thoughts of tidy commissions for pawning off what's left of the country for peanuts. But the path ther recent predecessors have put the country on isnt all that appealing to Canadian voters today. Not when they are forced into the corner theyve been in since being swept from power in 2006. Liberals will wait and see what happens in the US, like they did in the 1930's. Meanwhile, not enough Canadians, at least not in the numbers that would amount to a phony majority, are all that impressed with the Liberals, once again. 

Spectrum Spectrum's picture

You should be careful Dave of who you are suggesting are capitalistic pawns and voices demonstrating for and against "the value of the monetary system" when it might of  needed a revisionist assigned to the process:) Basically, what every you call "them," they are really "good people" that have just lost sight of an ideal toward a "Just society" and that what has to be done,  is to find the roots of, and discover where one might of gone wrong?

Is it in excess? How do you rise above"this fervour?"

Studying alternative views from a science perspective does provide for some understanding of the inherent nature disguised in the mathematical structure.  But to some, it is a "dissociative ill" with the social norms of living honestly and with integrity. Some might not know how ever to respond socially from the abstract to the social norm, yet science again can provide focus from "different angles" with which to approach this problem.

George Victor

The degree to which the critics of "economics" on this thread have managed to avoid reference to the real world, is a measure of their fealty to the abstract. Rejection of the preoccupation with mathematical models was the late J.K.Galbraith's strength. He refused to believe that it could be made to represent realilty. And, of course, events of the past year have proved him right.

This thread starts out in thrall to the idea of a "super" dependency on mathematical models, a "scientific" approach to economics that will solve the world's problems, apparently.  A meeting was to take place at the holy of holies, the Perimeter Institute.

Did anyone note what took place at the PI, May 1-4 ?   Was it upstaged by Hawking's  announcement that he was interested in new revelations about his black-hole theory?  Did the economics forum disappear into that hole?

What's the prattle about science?  A couple of people here have properly labelled it a "mug's game" (Keynes).

Spectrum Spectrum's picture

George Victor wrote:
a "scientific" approach to economics that will solve the world's problems, apparently.  A meeting was to take place at the holy of holies, the Perimeter Institute.

Come on George, is this really necessary? I posted the article in March for May.

First Principles by Howard Burton

You might enjoy a read by Howard Burton called, " First Principles" that might also help some to recognize what an opportunity has been presented here  as Canada's research institution which brings us to the front of research and development. Not only in terms of development but "sensitive to the creative freedoms" in a highly structure science society.

That conference is a blip in time yet significant from the perspective of a future that might address "the ills within an ole economic structure" that has gone on beating for some decades now. Some of those ideas were listed.

Of course science is being done there, and whether this is one conference that was sensitive to the times, it's intentions was nothing more then to gather thought and education in one spot too, "talk about the issues"( the urgency was spelt out in relation). In a manner,  that was presentable from different venues, as they do in perspective research into theoretics of physics and such.

There are quite a few more names being attached to PI and that should draw interest as well, but Susskind or Hooft are not the issue, as Stephen Hawkings isn't.

Maybe there is another problem here? A distrust? The beginning of this institution?

Quote:
"Gravity cannot be held responsible for people falling in love. Albert Einstein"

Fidel

I never cease to be amazed with the writing of one Canadian who has written about Canadian finance and the state of banking for a number of years. William Krehm has been advocating that money creation and banking in Canada be transformed to a public utility for years. Although perhaps not to quite the same extent as Willem Buiter has recently.

 

[url=http://www.foreignpolicy.com/story/cms.php?story_id=4856&page=1]Thoroughly Modern Marx[/url] Leo Panitch

 

Quote:

Ironically, one of the most radical proposals making the rounds today has come from an economist at the London School of Economics, Willem Buiter, a former member of the Bank of England's Monetary Policy Committee and certainly no Marxist. Buiter has proposed that the whole financial sector be turned into a public utility. Because banks in the contemporary world cannot exist without public deposit insurance and public central banks that act as lenders of last resort, there is no case, he argues, for their continuing existence as privately owned, profit-seeking institutions. Instead they should be publicly owned and run as public services. This proposal echoes the demand for "centralization of credit in the banks of the state" that Marx himself made in the Manifesto. To him, a financial-system overhaul would reinforce the importance of the working classes' winning "the battle of democracy" to radically change the state from an organ imposed upon society to one that responds to it.

The debt based monetary system isnt working and should be scrapped.

Spectrum Spectrum's picture

Quote:
Yet the work of building new institutions and movements for change must begin at home. Although he made the call “Workers of the world, unite!” Marx still insisted that workers in each country “first of all settle things with their own bourgeoisie.” The measures required to transform existing economic, political, and legal institutions would “of course be different in different countries.” But in every case, Marx would insist that the way to bring about radical change is first to get people to think ambitiously again.See:Thoroughly Modern Marx By Leo Panitch

Debt, is a economic form of slavery. The Green back was a lesson of a "fiat currency" circulated?  Is it a distinction then between "real gold" and paper fabrications?

George Victor

"You might enjoy a read by Howard Burton called, " First Principles" that might also help some to recognize what an opportunity has been presented here  as Canada's research institution which brings us to the front of research and development. Not only in terms of development but "sensitive to the creative freedoms" in a highly structure science society."

 

Howard Burton was "let go". Unfortunately, because in the early days, he worked to bring the Perimeter's work to the Great Unread.

 

The Canadian government, unfortunately, failed to respond to the appeals of the Perimeter Institute's founder and benefactor, the creator of the Blackberry and RIM, Mike Lazaridis. He thought that keeping Nortel's scientific findings in the country, rather than selling them abroad, made a lot of sense for this country. But THE ECONOMIST PM, Steve, is a made in America, born again free market economist, who would not dream of interfering with the workings of the holy of holies. The market and our maker will yet save us all. (The science of Christianity).

Have you ever tried to figure out how such a mind works with such contradictory evidence, Fidel?

Spectrum Spectrum's picture

George Victor wrote:
Howard Burton was "let go". Unfortunately, because in the early days, he worked to bring the Perimeter's work to the Great Unread.

I take it the Great Unread is society?

Yes, I heard about the Nortel issues as well. As Lazardis felt I too feel that there is something on the Horizon in terms of change coming in technologies and am quite excited about it. Yet, could I place my finger on it. No not really. Contributing to the ground bed of "creative opportunities" is a good way of "giving back" what one may have profited by, and I see nothing wrong with these intentions.

Having access to the library of lectures at PI and other institutions is one way of contributing back to society what happens in the halls of education. I think this is a good thing, for those hobbyists like myself who try and stay in tune with the thinking of our leaders in science this is one way of opening the doors to access of information(libraries, Google or wiki). Disseminating information, creates for a much broader possibility for new things to emerge, you see?

To contribute on the start up of a "whole institution" is indeed a grander thought when taking in the possibility some of the people you and I have mentioned, are working to perfect their dreams in science. Imagine Hooft, Susskind, and and Hawking,  lead by the institutions new leader Turok. If you have ever read Steinhardt you will understand Turok's influence brought to bear.

Quote:
No reader of Plato can fail to recognize the important role which mathematics plays in his writing, as would indeed be expected for an author about whom the ancient tradition maintains that he had hung over the entry to his school the words "Let No One Un-versed in Geometry Enter". Presumably it was the level of ability to work with abstract concepts that Plato was interested in primarily, but if the student really had never studied Greek geometric materials there would be many passages in the lectures which would be scarcely intelligible to him. Modern readers, versed in a much higher level of mathematical abstraction which our society can offer, have sometimes felt that Plato's famous "mathematical examples'" were illustrations rather than central to his arguments, and some of Plato's mathematical excursuses have remained obscure to the present time. See:PLATO-Mathematician or Mystic ?

Plato's influence is posted on the entrance to the north and south doors of PI. Some might never understand what that means knowing that abstractness can underlay real events, and that it is a matter of bringing abstractness back to reality for examination.

"Let no one destitute of geometry enter my doors."

Let no one destitute of geometry enter my doors."

Quote:
There were a few other, unique touches I had some fun with. Legend has it that glowering over the entrance to Plato's Academy was the phrase, "Let none ignorant of geometry enter here." Tipping our metaphorical hat to rigour of the Ancient Greeks while simultaneously invoking our outreach mandate, I contacted a classicist so that I could eventually inscribe a Greek translation of"Let no one uninterested in Geometry enter here" over both the the north and south doors of the building. It's possible that some wilful geometrical ignoramuses could penetrate the facility through another entrance, of course, but they'd have to go to a fair amount of trouble to do so.First Principles by Howard Burton, page 244, para 2 and page 245

George Victor

Plato was perhaps only trying to keep away the riffraff?

Spectrum Spectrum's picture

No George, it is a lesson I am giving about what is detached in our thinking,  that has many feeling mistrustful of the direction of society when talking about science and how these can mingle with societies understanding of these issues of economics

This is a historical relation that moves forward in time,  to where today, we are uncertain of the same things that have historically played out before from perspective. So while we talk about economics here, it a much broader issue in relation to what science can contribute to the issues of the day.

Spectrum Spectrum's picture

Lee Smolin - Symmetries in Economic Models and their Consequences

Quote:
These notes discuss several topics in neoclassical economics and alternatives, with an aim of reviewing fundamental issues in modeling economic markets. I start with a brief, non-rigorous summary of the basic Arrow-Debreu model of general equilibrium, as well as its extensions to include time and contingency. I then argue that symmetries due to similarly endowed individuals and similar products are generically broken by the constraints of scarcity, leading to the existence of multiple equilibria. This is followed by an evaluation of the strengths and weaknesses of the model generally. Several of the weaknesses are concerned with the treatments of time and contingency. To address these we discuss a class of agent based models. Another set of issues has to do with the fundamental meaning of prices and the related question of what the observables of a non-equilibrium, dynamic model of an economic market should be. We argue that these issues are addressed by formulating economics in the language of a gauge theory, as proposed originally by Malaney and Weinstein. We review some of their work and provide a sketch of how gauge invariance can be incorporated into the formulation of agent based models.

See Also:Security and Prosperity For What it Appears?

DrConway

Lee Smolin's article on arXiv.

Having read it, I find it amusing that the language of economics can be recast in the language of physics. That said a lot of it is hard going, mathematically, though the language he uses is familiar to me, having seen things like conserved currents in quantum electrodynamics.

I think caution should be taken in placing too much emphasis on the math. The ultimate goal of economics is to describe the monetary interactions of humans and how phenomena rooted in the exchange of goods, services, assets and money have broader repercussions (simple example: What happens if everybody saves money? You induce an economic recession, explained by the paradox of thrift.)

Spectrum Spectrum's picture

This Nobel Prize award was of interest to me.

The Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel 2007

"for having laid the foundations of mechanism design theory"

Leonid Hurwicz

Eric S.Maskin

Roger B. Myerson

I first started to come to the conclusion in regards to the "social construct" and the relationship it had to the mathematical environmental when I saw the movie, "The Beautiful Mind." It was based on the story of John Nash.

A Theory is Born

PBS: Game Theory Explained

Quote:
This science is unusual in the breadth of its potential applications. Unlike physics or chemistry, which have a clearly defined and narrow scope, the precepts of game theory are useful in a whole range of activities, from everyday social interactions and sports to business and economics, politics, law, diplomacy and war. Biologists have recognized that the Darwinian struggle for survival involves strategic interactions, and modern evolutionary theory has close links with game theory.

Game theory got its start with the work of John von Neumann in the 1920s, which culminated in his book with Oskar Morgenstern. They studied "zero-sum" games where the interests of two players were strictly opposed. John Nash treated the more general and realistic case of a mixture of common interests and rivalry and any number of players. Other theorists, most notably Reinhard Selten and John Harsanyi who shared the 1994 Nobel Memorial Prize with Nash, studied even more complex games with sequences of moves, and games where one player has more information than others.

I wanted to saved a little time, for I would be sure that this highlight in bold would draw attention? So, I thought to preempt it.

You have to understand where symmetry "begins and is possible" to understand that such a place, can exist in the minds of those who go there and become part of the process. This does not define those with agendas,  but also recognizes that if we partake as watchers of this process, we can be assured that citizens are given their full rights and respect while capitalism seeks to have it's mandate.

Spectrum Spectrum's picture

 

DrConway wrote:
Lee Smolin's article on arXiv.

Having read it, I find it amusing that the language of economics can be recast in the language of physics. That said a lot of it is hard going, mathematically, though the language he uses is familiar to me, having seen things like conserved currents in quantum electrodynamics.

I think caution should be taken in placing too much emphasis on the math. The ultimate goal of economics is to describe the monetary interactions of humans and how phenomena rooted in the exchange of goods, services, assets and money have broader repercussions (simple example: What happens if everybody saves money? You induce an economic recession, explained by the paradox of thrift.)

Hi Dr Conway

In bold isn't this what eventually happens when the economy undergoes a correction and we see the events that we do, to realize, that people are now nervous about how they are going to be able to care of themselves? So priorities change, your dollars in your pocket become "more accountable."

Quote:

BEYOND REDUCTIONISM: REINVENTING THE SACRED

Quote:
Stuart Alan Kauffman (28 September 1939) is an US American theoretical biologist and complex systems researcher concerning the origin of life on Earth. He is best known for arguing that the complexity of biological systems and organisms might result as much from self-organization and far-from-equilibrium dynamics as from Darwinian natural selection, as well as for proposing the first models of Boolean networks.

Kauffman presently holds a joint appointment at the University of Calgary in Biological Sciences and in Physics and Astronomy, and is an Adjunct Professor in the Department of Philosophy. He is also an iCORE (Informatics Research Circle of Excellence) [1] chair and the director of the Institute for Biocomplexity and Informatics.

BEYOND REDUCTIONISM

See:Reinventing the Sacred: A New View of Science, Reason, and Religion (Hardcover)

Quote:
Self-organization is a process of attraction and repulsion in which the internal organization of a system, normally an open system, increases in complexity without being guided or managed by an outside source. Self-organizing systems typically (though not always) display emergent properties.

Stuart Kauffman - The Evolution of Economic Wealth and Innovation

I think this is indeed the effort that translation occur from new proposals, to what finally happens to the individuals who partakes of this economic endeavor. I find "specialization can give perspective"  that would not normally be granted the person on the street, but that it is equally important to understand how these economic factors mathematically can play a part in our everyday lives.

The idea of economic correction itself?


(click on Image for larger viewing)

Fidel once offer the perspective of Kurzweil and the singularity . Now, how would this mean anything if there was not some comparison in phenomenological relation that we might push perspective forward?

At what times do we find such a thing taking place that all kinds of new things are introduced to send the system too,  already in chaos and find this is an opportunistic time to advance mathematical proposals into the system to see entropic valuation materialize to the person on the street?

A location perhaps, housing the possibilities of the "neurological synapse" considered to be the "white board of creative possibilities?"

Best,

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