The New Palgrave Dictionary of Economics

2018 Edition
| Editors: Macmillan Publishers Ltd

Induction

  • Paul W. Humphreys
Reference work entry
DOI: https://doi.org/10.1057/978-1-349-95189-5_892

Abstract

Induction, in its most general form, is the making of inferences from the observed to the unobserved. Thus, inferences from the past to the future, from a sample to the population, from data to an hypothesis, and from observed effects to unobserved causes are all aspects of induction, as are arguments from analogy. A successful account of induction is required for a satisfactory theory of causality, scientific laws, and predictive applications of economic theory. But induction is a dangerous thing, and especially so for those who lean towards empiricism, the view that only experience can serve as the grounds for genuine knowledge. Because induction, by its very nature, goes beyond the observed, its use is inevitably difficult to justify for the empiricist. In addition, inductive inferences differ from deductive inferences in three crucial respects. First, the conclusion of an inductive inference does not follow with certainty from the premises, but only with some degree of probability. Second, whereas valid deductive inferences retain their validity when extra information is added to the premises, inductive inferences may be seriously weakened. Third, whereas there is widespread agreement upon the correct characterization of deductive validity, there is widespread disagreement about what constitutes a correct inductive argument, and indeed whether induction is a legitimate part of science at all.

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Copyright information

© Macmillan Publishers Ltd. 2018

Authors and Affiliations

  • Paul W. Humphreys
    • 1
  1. 1.