The Histonomic Approach to Economics: Beyond Pure Theory and Pure Experience

Abstract

This article starts off with the distinction between logico-deductive and empirico-deductive approaches to economic theory. The logicodeductive approach, for instance neoclassical economics, uses an axiomatic framework that has only little empirical substance. The empirico-deductive approach, for instance, Ricardian economics, attempts to state economic theory as a “typical” structure of reality. It appears that the latter approach touches reality more closely and is more sensitive to intellectual enrichment and to substantial empirical evidence. However, both approaches operate within the basic assumption applied in classical physics, that theory must represent an invariant structure of reality—highlighting in this case economic phenomena that do not change over time. In the following, the induction issue is given new life, suggesting its validity under the non-conventional assumptions ofvariancy and time-asymmetry. A “histonomic” approach stressing the importance of making theoretical (-nomic) statements about economic phenomena that are basically historical (histo-) in their non-classical properties of variancy and time-asymmetry is favored.