Ramzi Mabsout

Abduction and economics: the contributions of Charles Peirce and Herbert Simon

A constantly changing social reality means economic theories, even if correct today, need to be constantly revised, updated, or abandoned. To maintain an up-to-date understanding of its subject matter, economists have to continuously assess their theories even those that appear to be empirically corroborated. Economics could gain from a method that describes and is capable of generating novel explanatory hypotheses. A pessimistic view on the existence of such a method was famously articulated by Karl Popper in The Logic of Scientific Discovery. He wrote ‘there is no such a thing as a logical method of having ideas or a logical reconstruction of this process.’ Herbert Simon responded to Popper and argued the opposite, namely, that there is a model of discovery and its name is abduction. Simon acknowledges his debt to Charles Peirce – the first modern logician to explicitly formulate a theory of abduction – and explains that abduction is a model of discovery that works as a problem-solving heuristic encoded in a computer program. Although Simons account of a model of discovery was prescient, Peirces description of abduction as loose inference is incompatible with an exclusive algorithmic operationalization. The paper also connects Peirces abduction to explanation in economics and the economic literature on uncertainty. It is argued that explanation, uncertainty, and abduction complement each other and their combination is valuable to economics.

Bringing Ethics Back to Welfare Economics

Economists do not agree on the nature of welfare economics: is it normative or positive analysis? To overcome this disagreement and bridge the gap between the two views, the argument developed here takes two steps. The first identifies the metaethical positions of those for and those against the moral normativity of welfare economics. Metaethical positions differ on the ontology and ultimate legitimacy of morality. What appears in ethical terms as confusion can, in metaethical terms, be an attempt to arrive at an intellectually consistent position. A more constructive and less polarizing discussion on the aims and scope of welfare economics is expected once metaethical differences are accounted for. In the second step, ethical realism is introduced as a metaethical stance that views morality not in terms of subjective desires or preferences but as truth-apt claims. It is suggested that understanding the moral normativity of welfare economics in terms of ethical realism presents an opportunity to break the deadlock that halted its progress.

Reconciling economics with naturalist ethical theory

Abstract The exclusive use of evolutionary explanations and game theory to justify moral claims has led economists to an impasse. Our discussion of this problem is focused on arguments made by Kenneth Binmore and Herbert Gintis, two vocal and notable economists behind these efforts. We begin by pointing out the false dilemma they present between ethical theories involving dubious non-naturalist metaphysics and their versions of naturalized game-theoretic ethics. We do so by, first, discussing alternative naturalist accounts, namely, those of Peter Railton and Richard Boyd. Second, we argue that their descriptive and explanatory theories are in fact committed to substantive normative claims. Our hypothesis is that their attempts to avoid ethical arguments are responsible for their mistaken belief that theirs is a scientific disagreement, whereas it is in fact one about human nature. Binmore and Gintis’s disagreement about ethical claims requires acknowledging and engaging with substantive normative arguments such as those of what is good and what ought to be done. The alternative would be a never-ending disagreement on the fundamental view of human nature. This path, we worry, may be a road to nowhere.