Empirical Claims in Exchange Economics

Abstract

I will assume that microeconomic equlibrium theories are empirical theories -although consideration of parts of scientific activities in this area seem to yield evidence to the contrary. If microeconomics is empirical it has to produce empirical claims which can be tested. According to the most prominent point of view of methodology in economics -that of Popper- theories are classes of statements, and consequently empirical claims consist of just those statements. However, among the axioms of most theories we find statements of the form “for all…there exist…” or of even more complicated structure. Microeconomics here provides a good example.2) In infinite domains (which are the rule) sentences of this form can neither be falsified nor validated by means of mere investigation of “atomic”, “basic” or “observational” sentences. On Popper’s account such statements cannot be validated at all, they only can be falsified by means of basic sentences plus the machinery of deductive logic. But of course scientists are interested in “true” (valid, confirmed) theories, and up to now Popperians have not been successful in explicating what this could mean and why following their simple norm “Try to construct theories as bold as possible, and try to falsify them” should lead to true theories. One major reason for this is that Popper’s frame of statements and deduction is too simple-minded (and thus inadequate) in order to grasp the essential features of what is going on in real-life theories.