July 10, 2006
Roy Bhaskar, the philosopher to whom the critical realist project within economics owes much by way of inspiration and initial conception, warns against what he terms 'the epistemic fallacy'. According to Bhaskar western philosophy has been under the spell of this fallacy implying that questions of being (ontology) have been reduced to questions of knowing (epistemology) or to method.
Doesn't this apply to be neo-classical economics? Its axiom of methodogical individualism blocks an understanding of society as made up by intentional actors as well as social structures with emergent powers which enable and facilitate, but also restrict and direct, individual action. Social structures are conceived as pre-existing individual actions, and are thus irreducible to them. However, by employing social structures in planning and performing individual action, the agents contribute to reproducing and transforming these structures.
The critical realist critique of neo-classical economics states that there is a mismatch between the mathematical-deductive methods of mainstream economics and the properties of social ontology as outlined above by the critical realists.
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