ARE ECONOMIC SYSTEMS CONTROLLABLE?

Abstract

I propose that national economies and economic systems are not controllable. I will argue that the illusion of controllability originates from confusion in the conceptual area. There is a confusion between the controllability of certain natural processes and the controllability of economic processes, and between control and government intervention with the intent to control. Deeper down at a theoretical level controllability assumes that societies or national economies “make” “rational choices”. I will argue that societies do not choose, there is no such thing as “social choice”. Societies drift under various endogeneous and exogeneous pressures. There are social values, norms and priorities emerging from the “murky waters” of drifting national economies “muddling through” their history in real space and real time and there are individual choices which are neither completely determined by the ruling social economic values or norms nor completely independent from them. There are limited choices between various ways and methods to intervene into an economy which will or will not be successful, depending on the future circumstances which are neither known nor predictable exactly.