Science and Economics: The Case of Uncertainty & Disequilibrium

Economic thinking is still very largely related to traditional Cartesian (and Newtonian) concepts of science. The notion of equilibrium is not really a concept or an explanation, but rather a tautology, which has been given the value or status of an axiom. Understanding this notion of equilibrium, where supply is equal to demand, is essential because it explains why economic theory has from the beginning always tended to be one-sided...Once we enter real time, uncertainty and disequilibrium become the reference criteria of reality. Introducing the notion of real time into the economics of supply and demand (in modern terms, service based production and consumption) is a radical alternative to the view of the economic process as being based on timeless (instant) equilibrium.

Author - Orio Giarini, Director, The Risk Institute

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Comments

I do agree that Science and

by jamesR - 10/24/2011 - 15:45

I do agree that Science and Economy are interrelated due to the fact that economy is considered also as a branch of science. Being a branch of science, it is expected that economy will work and can be studied and understood through scientific studies. The latest report shows a deepening negativity from the American public regarding its financial system and it suggests that over three-fourths of Americans distrust financial system. This just imply that more than three in four Americans interviewed said they do not trust the nation's economic system. Experts say that regulators can work to repair that trust but consumers also carry some of the responsibility and that's what we should work on. We must also do our part to make the economy better considering that a country will never work out even the leaders would try their best without the support of its countrymen doing their part.

Economy evolves around the

by Khali - 07/10/2011 - 13:29

 

Economy evolves around the social science and economics. Economy has a wide horizon. Every production and distribution affects the economy of the nation. Such as business, occupation, economic agents and economic activities that contribute to the economy. Consumption, savings and investment are fundamental variables of the economy and determine market equilibrium. There are three economic sectors: primary, secondary and tertiary.