Deductive logic is one pattern of rationality in reasoning, but it is not the only one; good reasoning in science typically yields conclusions that go beyond the logical entailments of deductive logic. (Suppe, 1977, p. 657)

 

The economists of the twentieth century, by pushing the neoclassical model to its logical conclusions, and thereby illuminating the absurdities of the world which they had created, have made an invaluable contribution to the economics of the coming century: they have set the agenda, work on which has already begun. (Stiglitz, 1991, p. 136)

 

For if orthodox economics is at fault, the error is to be found not in the superstructure, which has been erected with great care for logical consistency, but in a lack of clearness and of generality in the premises. (Keynes, 1973, p. xxi)

 

***

 

For Keynes as for Post Keynesians the guiding motto is "it is better to be roughly right than precisely wrong!" (Davidson, 1984, p. 574)

 

Marshall followed the maxim: Better to be ambigous and relevant than precise and irrelevant. (Colander, 1995, p. 283)

 

It is well known that John Maynard was born anew every morning; for this reason, his colleagues at Bretton Woods commented that he was too intelligent to be consistent. (Valentino, 1988, p. 239)

 

... a remorseless logician can end up in Bedlam. (Keynes, quoted in Moggridge, 1976, p. 36)

 

But Keynes, too, sometimes gave the impression of not having fully grasped the logic of his own system. (Laidler, 1999, p. 281)

 

Toutes ses [Keynes’s] deductions, à notre avis, manquent absolument de rigeur. ... L’intuition de Keynes lui a fait sentir où se trouvaient les difficultés, mais son insuffisance logique ne lui a pas permis de résoudre les problèmes que son intuition lui avait fait entrevoir. (Allais, 1993, p. 70)

 

***

 

Even if we cannot prove a theory or model is true, at the very minimum to be true it must be logically consistent. (Boland, 2003, p. 24)

 

... each chief step in science has been a lesson in logic. (Peirce, 1992, p. 111)

 

If we define the ambition of science as to get it precisely  right   then the guiding motto of Post Keynesianism amounts to an invitation of ‘Babylonian incoherent babble’ and leads, predictably, to a loss of theoretical coherence. Confronted with the phony alternative relevance vs. rigor or truth vs. precision the non-Keynesians opted for rigor:

Mathematical economics, it seems, had the great virtue of demonstrable irrelevance, which was morally preferable to spurious relevance. (Porter, 1994, p. 155)

 

Research is in fact a continuous discussion of the consistency of theories: formal consistency insofar as the discussion relates to the logical cohesion of what is asserted in joint theories; material consistency insofar as the agreement of observations with theories is concerned. (Klant, 1994, p. 31)

 

Economists today do not wish to discus the ‘truth’ of economic theories but only examine their logical validity. (Boland, 1992, p. 36)

 

Logical validity is indispensable. However, if the premisses are false the logical validity of the conclusions is pointless. Truth resides in the axioms, not in the deductive process. Because of a logical blind spot — the place one stands on is for the moment invisible —  economists today cannot see that they operate with inadmissible axioms. Logical validity is indispensable but not sufficient.

 

And so — faithful to the theory's conceptual cornerstones and hoping against all hope that the unthinkable may still be achieved (i.e., a satisfactory theory of the price mechanism) — the tormented upholders of the validity of the paradigmatic core of economic equilibrium theory appear singularly reluctant to face the problem of comparing expectations and results and assessing the consistency of the theory. (Ingrao and Israel, 1990, p. 346)

 

Formal consistency does not count for much if the axioms lack material consistency. Realism does not count for much if it cannot be properly formalized.

 

***

 

Walrasians are comparatively stronger on the formal leg,  Keynesians on the material leg; inseparable because of the micro-macro yoke they limp along together. There is nothing to choose between vacuous logic and platitudinous realism. Both approaches are beyond repair. It is not surprising that the respective proponents cannot, given their idiosyncratic premises, figure this out for themselves. This, though, is a matter of indifference because paradigm shifts have in any case a very special modus operandi.

 

We are lost in a swamp, the morass of our ignorance. ... We have to find the roots and get ourselves out! ... Braids or bootstraps are necessary for two purposes: to pull ourselves out of the swamp and, afterwards, to keep our bits an pieces together in an orderly fashion. (Schmiechen, 2009, p. 11)

 

Logical bootstrapping is what axiomatization is all about. Therefore, one has to jump  to new premises in order to see the defects of the previous premises. There is no path between them. Axiom sets are incommensurable, there is no synthesis and no continuity, the previous set is simply abandoned. In practical terms this means: both Walrasians and Keynesians are left behind the curve for good. Both approaches can still fulfill a useful role as practical examples of how not  to do science.

 

 

Reference

Allais, M. (1993). Les Fondements Comptable de la Macro-Économie. Paris: Presses Universitaires de France, 2nd edition.

Boland, L. A. (1992). The Principles of Economics. Some Lies my Teacher Told Me.London, New York, Ny: Routledge.
Boland, L. A. (2003). The Foundations of Economic Method. A Popperian Perspective. London, New York, Ny: Routledge, 2nd edition.
Colander, D. (1995). Marshallian General Equilibrium Analysis. Eastern Economic Journal, 21(3): 281–293. URL
Davidson, P. (1984). Reviving Keynes’s Revolution. Journal of Post Keynesian Economics, 6(4): 561–575. URL
Hudson, M. (2010). The Use and Abuse of Mathematical Economics. real-world economics review, (55): 2–22. URL

Ingrao, B., and Israel, G. (1990). The Invisible Hand. Economic Equilibrium in the History of Science. Cambridge, MA, London: MIT Press.

Keynes, J. M. (1973). The General Theory of Employment Interest and Money. The Collected Writings of John Maynard Keynes Vol. VII. London: Macmillan.

Klant, J. J. (1994). The Nature of Economic Thought. Aldershot, Brookfield, VT: Edward Elgar.

Laidler, D. (1999). Fabricating the Keynesian Revolution. Cambridge: Cambridge University Press.
Moggridge, D. E. (1976). Keynes. London, Basingstoke: Macmillan.

Peirce, C. S. (1992). The Fixation of Belief. In N. Houser, and C. Kloesel (Eds.), The Essential Peirce. Selected Philosophical Writings., volume 1, pages 109–123. Bloomington, IN: Indiana University Press, (1877).

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.

Schmiechen, M. (2009). Newton’s Principia and Related ‘Principles’ Revisited, volume 1. Norderstedt: Books on Demand, 2nd edition.

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

Suppe, F. (1977). Afterword. In F. Suppe (Ed.), The Structure of Scientific Theories, pages 615–730. Urbana, IL, Chicago, IL: University of Illinois Press.
Valentino, R. (1988). Discussion. In H. Hanusch (Ed.), Evolutionary Economics. Applications of Schumpeter’s Ideas, pages 238–249. Cambridge, New York, NY, etc.: Cambridge University Press.

 

***

 

Refers to Why Post Keynesianism is Not Yet a Science  URL  see also  Crisis and Methodology, Sec. 3   URL  and  Objective Principles of Economics  URL

 

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