I happen to be currently in a wondrously boring economics class in the dullest sense of the word.  We have our nice little model where consumers maximize utility and firms maximize profit, trade is perfect and instantaneous, and information is perfect known by all parties.  As much as I’m a fan of economics as a useful tool for understanding the world, I would like to call bullshit.

From a historical perspective, the entire theory of general equilibrium on which neoclassical microeconomics is founded seems, well, lifted from more respectable branches of science.  Two of the big foundational books in general equilibrium, Samuelson’s Foundations of Economic Analysis, and Debreu’s Theory of Value, are developed more by analogy than observation.  Samuelson’s model was the physics/chemistry of Josiah Willard Gibbs.  Debreu’s was the mathematics of the mathematicians working under the pseudonym Nicolas Bourbaki.  Thus, we see Samuelson applying Le Chatelier’s Principle about chemical equilibrium to studying economic equilibrium, and Debreu arguing that the fundamental theorems of welfare economics can really be viewed as results about topological vector spaces.   Much of the field of “blackboard economics” is the direct result of Debreu’s work.  Needless to say, I much prefer the legacy of Samuelson over that of Debreu, especially given his work on theories such as revealed preference which attempted to make economics more falsifiable.

While my criticism does not extend to economics as a whole, I am simply stunned by how pseudoscientific it seems in my economics class.  We have never looked at a single bit of data the entire time.  We have not discussed alternatives to the general equilibrium model, and all of the calculations we make on problem sets are for specifically those utility functions which make the results look pretty.   One of the greatest bullshit detectors of all time, Richard Feynman, says in “Cargo Cult Science”

Details that could throw doubt on your interpretation must be given, if you know them. You must do the best you can — if you know anything at all wrong, or possibly wrong — to explain it. If you make a theory, for example, and advertise it, or put it out, then you must also put down all the facts that disagree with it, as well as those that agree with it. There is also a more subtle problem. When you have put a lot of ideas together to make an elaborate theory, you want to make sure, when explaining what it fits, that those things it fits are not just the things that gave you the idea for the theory; but that the finished theory makes something else come out right, in addition.

Theoretical economists could do well to start following this advice.