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Why causal models fail for economies

May 9th, 2014 · No Comments

For the problem with the use of calculus on a biological or historical subject consider the elaborate model of world history in World History and the Eonic Effect

Consider causal continuity:

A>B>C> etc… the unbroken chain of events
_______A__B__C_____________________________

This won’t work for historical subjects. WHEE distinguishes ‘system action’ (causal or general law of succession) and ‘free action’, which redirects, modifies or stops a causal sequence

A>>>
_____________ //___________________ An historical sequence is redirected via a discontinuous process. No differental equation can work because it contains no information about the process ‘A’.

On a larger scale consider the Axial Age: the process shows no direct causal succession from its historical antecedents, although there is a mixture of the the two. Something is appearing from outside the system, and the result shows a discontinuity. The overal effect is immensely complex and needs more to deal with it. But the basic existence of discontinuities in history, thence in nature, is clear from the record. Note the appearances of ‘should’ in these discussions. A system economy should have no shoulds, it is supposed to be a causal market economy. Got that? You should knnow better. Input please.

To see how ‘system action’ and ‘free action’ can intersect consider the abstract definition of a genre, e.g. the ‘novel’. This is a timeless ‘idea’, but it can enter the historical stream via the process of being invented, so to speak. The abstract idea then finds exemplars whose ‘free action’ realizes instances of the genre.
More complicated versions of this are visible in the analysis of WHEE.
Economies always show this distinction, by definition. Free agents are realizing economic issues in the stream of an ‘economy’, but we can’t predict necessarily what those free agents will do. We can claim to be able to stylize this, as an approximation, but the results are never quite right.

We are confronted by this situation all the time: consider a computer and a mouse: the computer system is deterministic (system action), but with a mouse it idles to take in user input (free action) via the mouse. And this can change the computer’s causal sequence.

In this case all claims for economic ‘laws’ are open to question. Bullshit, Stop! If capitalists invoke economic necessity, and they do all the time with ‘laissez-faire’, to justify actions that serve their interest but not that of the rest, then were are justified in protesting the implied causal claims. This is an especially ludicrous situation with laissez-faire, ‘let be’. If you want to ‘leave economies alone’, you ought to apply ‘laissez-faire’ to protests against ‘laissez-faire’, these are valid economics free actions.

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