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Artículos

Vol. 5 No. 2 (2014): Otoño

Unrealistic Assumptions in Economics: an Analysis under the Logic of Socioeconomic Processes

DOI
https://doi.org/10.5281/zenodo.12908
Submitted
July 22, 2014
Published
2014-11-30

Abstract

The realism of assumptions is an ongoing debate within the philosophy of economics. One of the most referenced papers in this matter belongs to Milton Friedman. He defends the use of unrealistic assumptions, not only because of a pragmatic issue, but also the intrinsic difficulties of determining the extent of realism. On the other hand, realists have criticized (and still do today) the use of unrealistic assumptions - such as the assumption of rational choice, perfect information, homogeneous goods, etc. However, they did not accompany their statements with a proper epistemological argument that supports their positions. In this work it is expected to show that the realism of (a particular sort of) assumptions is clearly relevant when examining economic models, since the system under study (the real economies) is not compatible with logic of invariance and of mechanisms, but with the logic of possibility trees. Because of this, models will not function as tools for predicting outcomes, but as representations of alternative scenarios, whose similarity to the real world will be examined in terms of the verisimilitude of a class of model assumptions