Measurement, Quantification, and Economic Analysis: Numeracy in Economics

By Ingrid H. Rima | Go to book overview
Save to active project

Chapter 15

Experimenting with neoclassical economics

A critical review of experimental economics

Shaun Hargreaves Heap and Yanis Varoufakis


INTRODUCTION

Experimental economics has a long history, but in the last decade there has been a proliferation of dedicated laboratories yielding a large body of experimental results (see Roth (1988) for a review of this history). This chapter assesses the contribution of the experimental approach to the neoclassical canon. We set the scene in the next section with a brief discussion of the methodological role of experiments in economics. The third section focuses on the experimental evidence with respect to one aspect of neoclassical economics: its theory of decision-making. These two sections feed directly into the final sections which is concerned with the implications of these results for both method and neoclassical economics.


THE PROMISE OF EXPERIMENTS

Neoclassical economics has empiricism to thank for a strong defense of its often puzzling assumptions and concepts. 1 By referring the critic to the “tribunal of the facts”, it blunts all deductive criticism, asking instead the simple question: “Does the theory predict well?” If to predict is also to explain, then any theory which is consistent with its own premises can be good and proper depending entirely on its predictive capacity.

Many a criticism has stumbled on this empiricist defense, and yet there has been an undeniable and growing discomfort with its use over the last forty years. For example, econometrics may have prospered as a result of the commitment to empiricism, but the doubts have been growing at the same time. Unlike statisticians working in natural scientific or biomedical fields, economists have failed to make their statistics equally respectable. Instead, there is more than a hint of fool’s gold and the whiff of alchemy as the regressions pile up (see Hendry 1980). Indeed, we may laugh at the suggestion of “lies, more lies and statistics”, but it is a slightly nervous laugh because few economists will not at one time or another have been frustrated by the failure of the econometric evidence to throw any real light on a major

-262-

Notes for this page

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
Loading One moment ...
Project items
Notes
Cite this page

Cited page

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

Cited page

Bookmark this page
Measurement, Quantification, and Economic Analysis: Numeracy in Economics
Table of contents

Table of contents

Settings

Settings

Typeface
Text size Smaller Larger
Search within

Search within this book

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

While we understand printed pages are helpful to our users, this limitation is necessary to help protect our publishers' copyrighted material and prevent its unlawful distribution. We are sorry for any inconvenience.
Full screen
/ 462

matching results for page

Cited passage

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

Cited passage

Welcome to the new Questia Reader

The Questia Reader has been updated to provide you with an even better online reading experience.  It is now 100% Responsive, which means you can read our books and articles on any sized device you wish.  All of your favorite tools like notes, highlights, and citations are still here, but the way you select text has been updated to be easier to use, especially on touchscreen devices.  Here's how:

1. Click or tap the first word you want to select.
2. Click or tap the last word you want to select.

OK, got it!

Thanks for trying Questia!

Please continue trying out our research tools, but please note, full functionality is available only to our active members.

Your work will be lost once you leave this Web page.

For full access in an ad-free environment, sign up now for a FREE, 1-day trial.

Already a member? Log in now.

Are you sure you want to delete this highlight?