Economic theory and social change: problems and revisions

Fusari, Angelo (2010): Economic theory and social change: problems and revisions.

Abstract

Although many economists do a serious and respectable work, main stream economic theory contains an almost complete disregard for the importance of social, cultural and political structures which are the very foundation of the society. Worse than that, such disregard is developed into arrogance when representatives and textbook maintain the illusions of economic main stream science as value free, and sometimes it is even asserted that only if the economic system could be free from disturbing interferences from collective bodies it would function even without any ethical principle. Such testimonies of ignorance of historical and philosophical knowledge and lack of understanding of social structures are not maintained by serious researchers of economic science but are more to be seen as ideological statements. However these testimonies are unfortunately based on a very specific apprehension of both the society as well as space and time from the 18th century where the scientific discoveries and theories of Gallilei and Newton was turned into a mechanistic and idealistic philosophy. True is that Adam Smith did not fully accept such a view but alongside the philosophical approaches of Kant and Hegel the economic theory by the later writings of Marx and the Neo-classical theorists made economic science into a machinery which culminated with Walras, Pareto and Pigou although it was mathematically refined in the so called Arrow&Debreu model.

A main cause of the limitations of economics is its closure and excessive specialization in the context of sometimes very sophisticated modeling, formally rigorous but elusive of crucial aspects of reality, the causes of which remain therefore outside the adopted explanatory framework, as exogenous factors. It seems to us that a treatment of economics seen as a part of social thought is essential to an adequate deepening of social change and hence of economic dynamics. This general view will oblige us to dedicate an accurate analysis to the method of investigation and interpretation of social reality, and will imply a detailed critical review not only on mainstream economics but also the alternative proposals of a growing number of schools of thought. We shall see that our more comprehensive vision than the habitual ones is not hostile to a rigorous formalization of the economic process able to give the due importance to crucial features of the modern dynamic economies. A more detailed exposition of this matter will be given in the paragraph on the structure of the book.

It is difficult to tell anything about the educational prerequisites in order to grasps the content of this book. We are well aware that much of the content is fairly abstract. But acquaintance with abstract reasoning is valuable and is not necessarily limited to economists but we think and hope that also social and political scientists will enjoy the book, since we try to bring back economic science as a subset of sociological and political sciences, where it belongs. If students of philosophy should find something of interesting in our analysis, we would be very pleased.

• Item Type: MPRA Paper
• Language: English
• Keywords: Growth and Development; Innovation; Radical uncertainty; Entrepreneurship; Social change and social thought; Ethics, objective and subjective values; Market system
• Subjects: P - Economic Systems > P1 - Capitalist Systems > P12 - Capitalist Enterprises; O - Economic Development, Innovation, Technological Change, and Growth > O3 - Innovation ; Research and Development ; Technological Change ; Intellectual Property Rights > O33 - Technological Change: Choices and Consequences ; Diffusion Processes; A - General Economics and Teaching > A1 - General Economics > A10 - General; O - Economic Development, Innovation, Technological Change, and Growth > O1 - Economic Development > O11 - Macroeconomic Analyses of Economic Development; O - Economic Development, Innovation, Technological Change, and Growth > O1 - Economic Development; A - General Economics and Teaching > A1 - General Economics > A13 - Relation of Economics to Social Values; O - Economic Development, Innovation, Technological Change, and Growth > O1 - Economic Development > O16 - Financial Markets ; Saving and Capital Investment ; Corporate Finance and Governance; P - Economic Systems > P4 - Other Economic Systems; O - Economic Development, Innovation, Technological Change, and Growth > O3 - Innovation ; Research and Development ; Technological Change ; Intellectual Property Rights > O31 - Innovation and Invention: Processes and Incentives; A - General Economics and Teaching > A1 - General Economics > A14 - Sociology of Economics; O - Economic Development, Innovation, Technological Change, and Growth > O1 - Economic Development > O12 - Microeconomic Analyses of Economic Development; B - History of Economic Thought, Methodology, and Heterodox Approaches > B4 - Economic Methodology > B41 - Economic Methodology

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