Pragmatism in economic methodology: The Duhem-Quine thesis revisited

Abstract

Contemporary developments in economicmethodology have produced a vibrant agenda ofcompeting positions. These include, amongothers, constructivism, critical realism andrhetoric, with each contributing to the Realistvs. Pragmatism debate in the philosophies of thesocial sciences. A major development in theneo-pragmatist contribution to economicmethodology has been Quine's pragmatic assaulton the dogmas of empiricism, which are nowclearly acknowledged within contemporaryeconomic methodology. This assault isencapsulated in the celebrated Duhem-Quinethesis, which according to a number ofcontemporary leading philosophers of economics,poses a particularly serious methodologicalproblem for economics. This problem, asreflected in Hausman's analysis, consists ofthe inability of economics to learn fromexperience, thereby subverting the capacity totest economic theories. In this paper wedispute this position. Our argument is basedon a combination of Quine's holism with VanFraassen's constructive empiricism, especiallythe latter's analysis of empirical adequacy andhis pragmatic approach to explanation. Theresulting reorientation of economic methodologyrestores the capacity of economics to learnfrom experience and reinstates the imperativeof developing alternatives to orthodoxtheorizing in economics.