The Economic - Thermodynamic Analogy

[JWeeks]

Originally Posted by JoeNormal

Keynsian and Monetarist therories are obviously incomplete and in chaotic economic times like these, probably nearly useless. Unfortunately, they might be the best we have. How can someone who professes to know something about entropy not see that a measure of chaos must be included in economic theories? I think you just don't like the notion that a simple equation can't account for what's happening.

That's the problem, Joe. An "equation" has been proposed without any effort to apply data to it and see if it works. There are mounds of historical data that could be used to demonstrate if a single equation can account for what is happening, but no attempt has been made to actually do that.

It is like proposing the ideal gas law to describe the weather without actually verifying if the data supports the hypothesis.