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Critique of conventional economics: The well-nigh complete list

Logical inconsistency:

... Keynes was simply arguing that microeconomic theory is false! Presumably, it is false  because it is not logically consistent with all macrophenomena – such as persistent disequilibria – and thus, by modus tollens, at least one of the assumptions of microtheory is false and hence microtheory as a whole is false. (Boland, 2003, p. 143), original emphasis


Shoddy argumentation:

The currently prevailing pattern of economic theorizing exhibits the following three characteristics: (1) a syncopated style of argument fluctuating back and forth between literary and symbolic modes of expression, (2) naive translation, or the loose paraphrasing of formulae into sentences, and (3) loose verbal reasoning for certain aspects of theoretical argumentation where explicit symbolic formulation is lacking. (Dennis, 1982, p. 698)


Inappropriate copying of physics:

Thus many are inclined to blame inappropriate copying of physics for the willingness of neoclassicals to tolerate bizarrely unrealistic assumptions and to place everything historical, cultural, institutional, and even psychological outside the framework of economic analysis. (Porter, 1994, p. 128)

The drive to incorporate the formalism of Hamiltonian dynamics is one pertinent example of the triumph of technique over theoretical insight. (Mirowski, 1995,

p. 376)

Borrowing the wrong concepts from mathematics:

The discipline of economics has so far successfully resisted all efforts to alter its character as an exercise in how to reason deductively from axiomatic principles. That is, it has insisted on remaining the Euclidean geometry of the social sciences. (Eichner, 1979, p. 172) 


Overemphasis of the mathematical method:

It is thus not at all surprising that mainstream contributions are found continually to be so unrealistic and explanatorily limited. The (mathematical) method, or rather the emphasis placed upon it in the modern economics academy, is the overriding problem.  (Lawson, 2012, p. 3), original emphasis


Misapplication of mathematics:

A second class of economists contain those who have abundantly employed mathematical apparatus, but, misunderstanding its true use, or being otherwise diverted from a true theory, have built upon the sand. (Jevons, 1911, p. xxv)


Mock precision:

Much economic theorising to-day suffers, I think, because it attempts to apply highly precise and mathematical methods to material which is itself much too vague to support such treatment. (Keynes, quoted in Chick, 1998, p. 1864)


Lack of facts:

Next, the empirical background of economic science is definitively inadequate. Our knowledge of the relevant facts of economics is incomparably smaller than that commanded in physics at the time when the mathematization of that subject was achieved. ... It is due to the combination of the above mentioned circumstances that mathematical economics has not achieved very much. (von Neumann and Morgenstern, 2007, p. 4)


Inconclusiveness of facts:

Even econometricians using identical, or almost identical, data sets are regularly found to produce quite contrasting conclusions, usually with little attempt at explanation. The systematic result here, as the econometrician Edward Leamer observes, is that: "hardly anyone takes anyone else's data analysis seriously". (Lawson, 2012, p. 9)


Denial of empirical refutation:

... suppose they [the economists] did reject all theories that were empirically falsified ... Nothing would be left standing; there would be no economics. (Hands, 2001, p. 404), original emphasis


Misleading principles:

Now the rationality principle, which in the social sciences plays a role somewhat analogous to the universal laws of the natural sciences, is false, and if in addition the situational models are also false, then both the constituent elements of social theory are false. (Popper, 1994, p. 173)


Mistaken beliefs:

The notion that microeconomics is a branch of applied mathematics does economists more credit than several possible alternative explanations for its empirical weakness. ... It isolates the limitations of the theory in a factual supposition about the determinants of human behavior, one that economists share with all of us. But the supposition we all share is false, and so economics rests on a purely contingent, though nevertheless central, mistaken belief .... (Rosenberg, 1992, p. 247)


Lack of realism:

Upon leaving office, each new president of the American Economic Association gives the expected speech showing that he knows full well it is all just a game, and chastises his colleagues for not being more realistic. (Hudson, 2010, p. 9)



Cunningham in 1891 remarked that in the choice of premises “it is not always easy to tell when a professor of the dismal science is making a joke” and I suspect that Cunningham meant that if the professor was not joking, then he was making a fool of himself. (Viner, 1963, p. 12)

And no economist, if I may say so, has ever been helped toward its solution by starting his investigation on the basis of some general theory of value, particularly any theory of value which rested upon marginal utility or upon marginal disutility or upon some combination of the two. (Parry, 1921, p. 128)


Ignorance of time and history dependence:

The notion of time is so primitive and basic an element in man’s experience that its neglect by much economic theory constitutes an incredible puzzle. This puzzle is attributable, perhaps, to the almost irresistible lure of formalism – particularly one that cannot adequately handle time. (Rizzo, 1979, p. 1)

History dependence stares us in the face ..., but it is not the stuff of pure theory. (Hahn, 1991, p. 48)


Ignorance of institutions:

In the earlier part of the century there were major conflicts between institutional economists, who saw the particular arrangements by which particular economies conducted their economic affairs as essential, and neoclassical economists, who sought to see through these inessential details to the underlying fundamental forces - the forces of demand and supply. (Stiglitz, 1991, p. 136)


Counterfactual equilibrium and zero profits:

The Walrasian prices correspond to the Marshallian long-run equilibrium prices where every producer is making zero excess profits. ... But, from the macro perspective of of Walrasian general equilibrium, the total   profits in this case cannot be other that zero (otherwise, we would need a Santa Claus to provide the aggregated positive profit) ... (Boland, 2003, p. 150), original emphasis


Questionable foundational assumptions and unjustifiable policy advice:

Much of economic theory is based on three questionable assumptions: (1) the world is deterministic; (2) decision makers act as if they know the values of all relevant parameters; and (3) consumers and firms respectively, act as if they were maximizing utility and profit. ... In order to tell the politicians and practitioners something about causes and best means, the economist needs the true theory or else he has not much more to offer than educated common sense or his personal opinion. Economists derive theorems, make predictions, and (!) suggest economic policies using arguments which explicitly or implicitly postulate the validity of the first two assumptions mentioned above. Such endeavors are unjustifiable unless it can be demonstrated that the most important doctrines of economics are insensitive to a relaxation of these two assumptions. (Stigum, 1991, pp. 29-30)


Wrong methodology:

The essence of contemporary mainstream economics does not lie at the level of substantive theory as most of its critics suggest, but at the level of methodology. (Lawson, 1997, p. 282)


Evasion of reality:

The modern history of economic theory is a tale of evasion of reality. Faced with the challenge of these vast changes and vital problems for over a century, it reacted by denying their existence in order to be able to produce a scientific system, a smoothly-functioning self-balancing model. (Balogh, 1982, p. 32)


No predictive capacity:

Economic theory seems permanently stuck at the level of generic predictions – predictions that some change will happen some time and some place, without ever telling us when and where and how much of a change will occur. (Rosenberg, 1994, p. 217)


An unfinished task:

It is good to have [the technically best study of equilibria], but perhaps the time has now come to see whether it can serve in an analysis of how economies behave. The most intellectually exciting question of our subject remains: is it true that the pursuit of private interest produces not chaos but coherence, and if so, how is it done? (Hahn, 1984, p. 102)


Lack of imagination:

Thousands upon thousands of scholars, as well as thousands of statesmen and men of affairs, have contributed their efforts to the attempt to understand the course of events of the economic world. And today this field of investigation is being cultivated more extensively, than ever before. How is it, then, that in all these years, and with all the undoubted talent that has been lavished upon it, the subject of economics has advanced so little? (Schoeffler, 1955, p. 2)

In other words, the main developments in economics of the twentieth century ... had been more a matter of form than of substance. ... Little new of any great significance has been learned about the workings of markets since Adam Smith and ... Smith added much less to the discussion than most economists have commonly supposed. (Nelson, 2006, p. 298)

Yet most economists neither seek alternative theories nor believe that they can be found. (Hausman, 1992, p. 248)


Lack of convincing alternatives:

If one calls those individuals working in the field of microeconomic foundations of Keynesian economics Keynesian-economic theorist, then, as Hahn has said, these Keynesians were not much better. (Morishima, 1984, p. 57)

For as I said at the outset, the citadel is not at all secure and the fact that it is safe from a bombardement of soap bubbles does not mean that it is safe. (Hahn, 1984, p. 78)


No future:

There seems to be a quiet confidence in the profession that we are moving, if only slowly, towards a more scientific basis for economics. ... Paradoxically many of those who have contributed much to the development of general equilibrium theory are less complacent. (Kirman, 1989, p. 126)

... anything based on this mock-up is unlikely to fly. (Hahn, 1981, p. 1036)

Neoclassical economics is metaphorically boxed in, and cannot extricate itself. (Mirowski, 1995, p. 389)

The disciplines that we currently call “social sciences” may accumulate gossip or spot correlations, but Rosenberg believes they will never succeed in formulating laws and theories with the force and fruitfulness of those in the natural sciences. (Hausman, 1992, p. 326)

What is now taught as standard economic theory will eventually disappear, no trace of it will remain in the universities or boardrooms because it simply doesn’t work ... (McCauley, 2006, p. 17)


Ideological bias:

Evidently, the tools are not strong enough to discriminate among fundamentally different hypotheses, or at least not strong enough to overcome differences in prior beliefs, beliefs which are often influenced by ideological concerns. (Stiglitz, 1991, p. 134)


Political bias:

Broadly speaking, policies fall into two categories: laissez faire or interventionist public regulation. Each set of advocates has its own preferred mode of mathematical treatment, choosing the approach that best bolsters their own conclusions. (Hudson, 2010, p. 6)


Lack of public assurance:

... it is clear that the public's lack of faith in the scientific nature of economic knowledge is a fact, past and present. (Benetti and Cartelier, 1997, pp. 211-212)



Suffice it to say that, in my opinion, what we presently possess by way of so-called pure economic theory is objectively indistinguishable from what the physicist Richard Feynman, in an unflattering sketch of nonsense "science," called "cargo cult science". (Clower, 1994, p. 809)



The position I now favor is that economics is a pre-science, rather like astronomy before Copernicus, Brahe and Galileo. I still hold out hope of better behavior in the future, but given the travesties of logic and anti-empiricism that have been committed in its name, it would be an insult to the other sciences to give economics even a tentative membership of that field. (Keen, 2011, p. 158)

Economics is a peculiar subject. It looks like a science both in its formal structure and its basic concern with observable reality. And yet economics does not reveal the sort of cumulative progress in the practical manipulation of reality that is one of the abiding characteristics of physics, chemistry, geology and parts of biology. (Blaug, 1990, p. 233)

Within the whole of his [the economist's] science, or what he insists on calling science, no generally recognised result is to be found, as is also the case for theology and for roughly the same reasons; there is no single doctrine taken to be a scientific truth without the diametrically opposed view being similarly upheld by authors of high repute. (Wicksell, quoted in Deane, 1983, p. 8)

We are merely at the threshold of an economic science. (Morgenstern, 1941, p. 374)



Few people, and least of all we economists ourselves, are prone to offer us congratulations on our intellectual achievements. Moreover our performance is, and always was, not only modest but also disorganized. Methods of fact-finding and analysis that are and were considered substandard or wrong on principle by some of us do prevail and have prevailed widely with others. (Schumpeter, 1994, p. 6)

I think it is the lack of quite sharply defined concepts that the main difficulty lies, and not in any intrinsic difference between the fields of economics and other sciences. (von Neumann, quoted in Mirowski, 2002, p. 146 fn. 49)



... the economists, like the theoretical sociologists of old, only more so, tried to solve the largest possible problems from the least possible knowledge. (Postan, quoted in Viner, 1963, p. 12)


Counterproductive organization:

It could be argued, moreover, that the present organization of the profession is itself a negative factor to the extent that the requirement of rapidly obtained results discourages researchers from entering the domains that are most uncertain (even if they are essential). (Benetti und Cartelier, 1997, p. 215)

We are in danger of losing our grip on the concepts of truth, evidence, objectivity, disinterested inquiry. The preposterous environment in which academic work is presently conducted is inhospitable to genuine inquiry, hospitable to the sham and the fake.  (Haack, 1997, p. 1)


Increasing incompetence:

The last thirty years seem to this observer to have been downhill  almost all the way. So much of the literature ... I see as silly beyond all expectation and unscholarly beyond all endurance. (Leijonhufvud, 1998, p. 234), original emphasis

Reluctance to scrap obsolete intellectual capital:

Gary Becker has suggested that a substantial resistance to the acceptance of new ideas by scientists can be explained by two familiar economic concepts. One is the concept of specific human capital: the established scholar possesses a valuable capital asset in his command over a particular body of knowledge. That capital would be reduced if his knowledge were made obsolete by the general acceptance of a new theory. Hence, established scholars should, in their own self-interest, attack new theories, possibly even more than they do in the absence of joint action. The second concept is risk aversion, which leads young scholars to prefer mastery of established theories to seeking radically different theories. Scientific innovators, like adventurers in general, are probably not averse to risk, but for the mass of scholars in a discipline, risk aversion is a strong basis for scientific conservatism. (Stigler, 1983, p. 538), see also (Sy, 2012, pp. 71-73)


Failed axiomatization:

The formal foundations of conventional economics are indefensible. (AXEC)




Balogh, T. (1982). The Irrelevance of Conventional Economics. London: Weidenfeld and Nicolson.

Benetti, C., and Cartelier, J. (1997). Economics as an Exact Science: the Persistence of a Badly Shared Conviction. In A. d’Autume, and J. Cartelier (Eds.), Is

Economics Becoming a Hard Science?, pages 204–219. Cheltenham, Brookfield, VT: Edward Elgar.

Blaug, M. (1990). Economic Theories, True or False? Aldershot, Brookfield, VT: Edward Elgar.

Boland, L. A. (2003). The Foundations of Economic Method. A Popperian Perspective. London, New York, Ny: Routledge, 2nd edition.

Chick, V. (1998). On Knowing One’s Place: The Role of Formalism in Economics. Economic Journal, 108(451): 1859–1869. URL

Deane, P. (1983). The Scope and Method of Economic Science. Economic Journal, 93(369): 1–12. URL

Clower, R. W. (1994). Economics as an Inductive Science. Southern Economic Journal, 60(4): 805–814.

Dennis, K. (1982). Economic Theory and the Problem of Translation (I). Journal of Economic Issues, 16(3): 691–712. URL

Eichner, A. S. (1979). A Look Ahead. In A. S. Eichner (Ed.), A Guide to Post-Keynesian Economics, pages 165–184. London, Basingstoke: Macmillan.

Haack, S. (1997). Science, Scientism, and Anti-Science in the Age of Preposterism. Skeptical Inquirer, 21(6): 1–7. URL

Hahn, F. H. (1981). Review: A Neoclassical Analysis of Macroeconomic Policy. Economic Journal, 91(364): 1036–1039. URL

Hahn, F. H. (1984). Equilibrium and Macroeconomics. Cambridge, MA: MIT Press.

Hahn, F. H. (1991). The Next Hundred Years. Economic Journal, 101(404): 47–50.

Hands, D.W. (2001). Reflection without Rules. Economic Methodology and Contemporary Science Theory. Cambridge, New York, NY, etc: Cambridge University Press.

Hausman, D. M. (1992). The Inexact and Separate Science of Economics. Cambridge: Cambridge University Press.

Hudson, M. (2010). The Use and Abuse of Mathematical Economics. real-world economics review, (55): 2–22. URL

Jevons, W. S. (1911). The Theory of Political Economy. London, Bombay, etc.: Macmillan, 4th edition.

Keen, S. (2011). Debunking Economics. London, New York, Ny: Zed Books, rev. edition.

Kirman, A. (1989). The Intrinsic Limits of Modern Economic Theory: The Emperor has No Clothes. Economic Journal, Conference Papers, 99(395): 126–139. URL
Lawson, T. (1997). Economics and Reality. New York, Ny: Routledge.

Lawson, T. (2012). Mathematical Modelling and Ideology in the Economics Academy: Competing Explanations of the Failings of the Modern Discipline? Economic Thought, 1(1): 3–22. URL

Leijonhufvud, A. (1998). Discussion: Involuntary Unemployment One More Time. In R. E. Backhouse, D. M. Hausman, U. Mäki, and A. Salanti (Eds.),
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McCauley, J. L. (2006). Response to "Worrying Trends in Econophysics". EconoPhysics Forum, 0601001: 1–26. URL

Mirowski, P. (1995). More Heat than Light. Cambridge: Cambridge University Press.

Mirowski, P. (2002). Machine Dreams. Cambridge: Cambridge University Press.

Morgenstern, O. (1941). Professor Hicks on Value and Capital. Journal of Political Economy, 49(3): 361–393. URL

Morishima, M. (1984). The Good and Bad Use of Mathematics. In P. Wiles, and G. Routh (Eds.), Economics in Disarry, pages 51–73. Oxford: Blackwell.

Nelson, R. H. (2006). Economics as Religion: From Samuelson to Chicago and Beyond. Pennsylvania, PA: Pennsylvania State University Press.

Parry, C. E. (1921). A Revaluation of Traditional Economic Theory. American Economic Review, Papers and Proceedings, 11(1): 123–131. URL

Popper, K. R. (1994). The Myth of the Framework. In Defence of Science and Rationality. London, New York, Ny: Routledge.

Porter, T. M. (1994). Rigor and Practicality: Rival Ideals of Quantification in Nineteenth-Century Economics. In P. Mirowski (Ed.), Natural Images in Economic

Thought, pages 128–170. Cambridge: Cambridge University Press.

Rizzo, M. J. (1979). Disequilibrium and All That: An Introductory Essay. In M. J. Rizzo (Ed.), Time, Uncertainty, and Disequilibrium, pages 1–18. Lexington, MA,

Toronto: Lexington Books.

Rosenberg, A. (1992). Economics - Mathematical Politics or Science of Diminishing Returns? Chicago, IL: University of Chicago Press.

Rosenberg, A. (1994). What is the Cognitive Status of Economic Theory? In R. E. Backhouse (Ed.), New Directions in Economic Methodology, pages 216-235. London, New York, Ny: Routledge.

Schoeffler, S. (1955). The Failures of Economics: A Diagnostic Study. Cambridge, MA: Harvard University Press.

Schumpeter, J. A. (1994). History of Economic Analysis. New York, Ny: Oxford University Press.

Stigler, G. J. (1983). Nobel Lecture: The Process and Progress of Economics. Journal of Policical Economy, 91(4): 529–545.

Stiglitz, J. E. (1991). Another Century of Economic Science. Economic Journal., 101(404): 134–141.

Stigum, B. P. (1991). Toward a Formal Science of Economics: The Axiomatic Method in Economics and Econometrics. Cambridge, MA: MIT Press.

Sy, W. (2012). Endogenous Crisis and the Economic Paradigm. real-world economics review, (59): 67–82. URL

Viner, J. (1963). The Economist in History. American Economic Review, 53(2): pp. 1–22. URL

von Neumann, J., and Morgenstern, O. (2007). Theory of Games and Economic Behavior. Princeton: Princeton University Press. (1944).




See also Confused Confusers: How to Stop Thinking Like an Economist and Start Thinking Like a Scientist  URL


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