RE: Why Economics is not an Empirical Science but a Synthetic A Priori - Analysed and Explained with Comedy.

[roydestory]

Surely the individual mind cannot be lab tested, but we can study minds in general. This gives us an average that we can base on predictions on right? I mean you can't predict the outcome of flipping one coin, but you could make a very good guess what'll happen if we flip a thousand coins.

I'd say the interactions are just too complex (butterfly effect) to predict anything usefull in the trading industry, but that doesn't mean economic science isn't informed by experience.

Sorry for the ongoing attack, but your very strong claims deserve it ;)

Comments

[vimukthi]

we can study minds in general. This gives us an average that we can base on predictions on

This is what Technical Analysts do. I'll quote from a great TA named @haejin

There is a famous saying in the Plato's Republic Essay: "what are words but symbols of symbols; hence twice removed from reality." You might also be familiar with Plato's Allegory of the Cave which too has the same rationale.

So, thought is expressed as sentiment, a form of conferred chemical energy, which is reflected and expressed in duality: Fear and Greed. For cryptos, such expression is seen in its price actions. This is also why measuring price movements can't be perfect as all techniques are twice removed from "Reality". This is why Elliott Waves need updates and edits with new price action data as it only measures the reflection of sentiment.

It's important to remember that no Technical Indicator is less than "Twice Removed" from reading sentiment. The only object that can be "once removed" is called a Crystal Ball and unfortunately no living being possesses that.

Remember I brought up Newton in my post. His theories were very useful in mundane activities. But ultimately they were just mostly BS. You could find some patterns and statistics. They can have some limited usefulness. But they won't be anything more than some generalizations like women don't make great leaders or men suck at cooking. It all works until it doesn't. If you depend on these empirical things you are eventually going to get screwed like a space program planned with Newtonian Physics in mind.

Reference to empirical facts serve merely as illustrative examples, they are not statements of principles. One can ignore and violate the fundamental laws of economics but one cannot change them.

Even the best TAs can only claim little over 85% accuracy and even they can't say anything consistently accurate about timing. Empirical evidence can be used as a rule of thumb or an archetype or a cliche. But they will never be an economic science.