Methodology in Economics: Some Implications of Pessimism and Some Suggested Alternatives

Abstract

In the last decade we have seen two parallel developments in economics. First, we have seen economic research striking out into many new direc tions and returning to many old ones with new and sophisticated techniques. Second, we have witnessed a most disquieting and quite violent disagreement over basic methodological issues and over the scientific status of economics. This immediately raises a rather important question: Can the foundations be shaken without having severe consequences upon the outcome, interpretation, and even the continuation of the economic research ? It is for this reason that the author would like to expose what seem to be some of the dangers of some of the present arguments, and to suggest ways for economists to move in order to reach greater agreement on these methodological issues. Without such agreement the results of the current research boom will be subject to increasing doubt, and perhaps could turn out to be an empty bubble that might break without leaving us any wiser.