Lilly Pad

January 15, 2012

In summary, economists elevate their failure (to come to terms with strategic complexity) to a higher plane of mathematical complexity on which the original complex problem remains just as unsolved as it ever were. The only merit of this theoretical complexity is to confuse the mathematically ill-equipped, to have them think that the economists got to the bottom of the problem (when they have done no such thing). In short, it is a thinly veiled form of intellectual fraud. In reality, it constitutes a form of Complexity Denial which, however, allows them to pretend that the complex problem has been disentangled.

The reason why the economists’ efforts are extremely dangerous, and qualify as a form of toxic theory, is that, on the basis of their false claims (for having dissolved complexity) and the associated formulae [i.e. functions like qk = f(pk,πk)], they build theories which then ‘scientifically’ underpin both catastrophic economic policy (e.g. the macro-econometric estimates of the effects of austerity on growth) and the value of financial instruments (e.g. the infamous value at risk of financial institutions).

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Complexity Fetishism, the Euro Crisis and a worthy challenge for 2012: Part A « Yanis Varoufakis (via quotingthecrisis)

Even Kurt Gödel’s Incompleteness Theorem is more straightforward than the tangle of math modern economists are hurling at the present financial crisis. These mathematical exertions are something worse than a con game; they are artifacts of intellectual denial. Economists wish to deny the stark evidence of the market’s inability to regulate itself.

(via quotingthecrisis)

9:23am | URL: http://imall4frogs.tumblr.com/post/15886527410/in-summary-economists-elevate-their-failure-to
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