The Empiricist Problem in Economics (TEST POST 1)

The normative idea around economics is divorced from non-empirical factors it pretends it’s irrelevant; it’s a “science” in the same manner as sociology, to the dismay of economists who never understood the limits of empiricism.

To even engage with empiricism is to have stuff whose variables can be replicated & controlled. Any environment has a set of dimensions that’s nested into “x” amount of variables. The context it’s used in determines the “x” amount.

Low-count dimensions are what empiricism measures: this is where GDP, HDI, per-capita studies & whatnot are assessed.

High-count dimensions (sociology, psychology, societal sentiments, etc) are clusterfucks in that regard; folks can’t shoehorn empiricist methods there due to how primitive computing is. We can only model first/second-order factors of an environment & hand-wave nth-order downstreams.

This ties back to the point of economics being similar to sociology; it being an intersection of high-count dimensions (psychology, beliefs, class, etc) would mean higher upstreams (GDP, HDI, etc) cannot be divorced from it.

Economists are incentivized to ignore the high-count areas; they get abstracted away into data points that empiricism then converts into low-count dimensions. This isn’t intentional but it’s an emergent of the state-model + downstream effects of the Neoliberal School of Economics; an unintentional solution that fixed the simplicity of Keynesianism but fell short when it tried to aggregate high-count dimensions.

The demands of the financial sector + banks filled into it, birthing hyperfinancialism.

Policies are then built to cater to low-count dimensions; think tanks record the “success” of neoliberal results for future policymakers to replicate. The limits of empiricism never get understood & economists persist to feed into this cycle.