Abstract
Theoretical economics should not be divorced from real life. If theoretical research cannot provide a good explanation for real-world economic phenomena, then we have to question the appropriateness of the paradigm that our theoretical research follows. The battle between neoclassical macroeconomics and Keynesian economics has exposed the inadequacy of the paradigm that modern mainstream economics has followed. Neoclassical macroeconomics and Keynesian economics have the same microeconomic(s) basis. However, the paradigm of the microeconomics on which they are based has serious flaws—the scarcity hypothesis and the economic man hypothesis—do not conform to the facts. These two hypotheses are the basis for other hypotheses and principles, but neither of these two hypotheses holds up to scrutiny. Then the economics edifice built on this foundation is certainly unstable, and the corresponding economic policies are certainly not perfect.
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Notes
The concept of "paradigm" originated from the Greek language and originally referred to the root or etymology of linguistics and was later extended to the source or mother of a certain thought-form. Thomas Kuhn proposed the paradigm theory of scientific development in "The Structure of Scientific Revolutions" published in 1962. He regarded science as a kind of professional activity carried out by a certain science community in accordance with a common paradigm. Kuhn's paradigm refers to a set of conceptual systems and analytical methods that are accepted, used and communicated by people in a certain discipline. He found that the scientific revolution and paradigm shift have been constantly alternating. Lakatos stressed that the research programs are just the paradigms. In the "The Methodology of Scientific Research Programmes" published in 1978, his scientific research programs theory further deepened Kuhn’s scientific outlook on development. Lakatos believed that science is an organic whole and a system of concepts and propositions. It is not only hard and rigid (like the hardcore), but also tough, elastic, and adaptable. When the scientific research program meets the competition of abnormal facts and theoretical opponents, it is not immediately overturned, eliminated, and abandoned. Instead, it corrects abnormalities, overcomes opponents, and achieves self-repair and evolutionary development through adjustments and additions of supplementary hypotheses.
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This research is supported by the research fund from “Collaborative innovation center for Transformation and Upgrading of Micro, Small and Medium Enterprises, Zhejiang University of Technology”.
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Xie, A. The Paradigm Crisis of Modern Mainstream Economics. Axiomathes 30, 37–48 (2020). https://doi.org/10.1007/s10516-019-09435-0
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DOI: https://doi.org/10.1007/s10516-019-09435-0