Paradigm Lost, Economics Regained: An Anatomical Lesson on the Gravity Model

Abstract

Throughout his life Hans Linnemann has been concerned with equality and wealth in this world. Rather than travelling with his emergency kit to the poorest and most deprived, Hans took refuge in science, hoping to succeed where direct approaches often fail. But science is not straightforward. As Popper, Kuhn, Lakatos and others teach, science takes many paths — paradigms — that sometimes meet dead ends and sometimes join, having travelled apart for long. One such paradigm is the analysis of gravity, cherished by Hans for its simplicity and its readiness for empirical applications. Although applied already by Carey (1858) the theory can be said to have its roots in the Social Physics School of Zipf (1946), who launched the idea of approaching economic problems with existing models in physics. One of those models was Newton’s theory of gravity, in its simplest form given by

$$F = \gamma \frac{{MM'}}{{{D^2}}}$$

(4.1)

expressing the idea that the gravitational force F with which two bodies attract each other is directly proportional to their masses and inversely proportional to the square of their distance apart. The parameter γ is considered to be constant, viz. 6.67.10⁻¹¹ N(m/kg), whatever the setting of the theory and therefore known as the constant of gravity.

We thank Michiel Keyzer, whose constructive remarks led to an improvement of this chapter, and René van Gelderen and Hielke Buddelmeijer for their assistance with word processing.