Falsification and Economics

Abstract

Sir Karl Popper’s methodological writings have proved to be a source of much debate, and controversy, since the early 1930s and his views have received much attention from economists, many of whom support them. However, despite this interest in Popper’s work it seems that a number of misconceptions are commonly encountered. For example, few economists seem to have fully appreciated the radicalism of Popper’s approach. When we compare the practice of many economists against some of Popper’s prescriptions we often find wide differences. More fundamentally, the more recent writings of Popper suggest that the methodology considered in this chapter was designed primarily for the natural sciences. Consequently, I shall need to consider not only the feasibility of Popper’s method, but also its applicability to economics. In what follows I shall outline Popper’s methodology, then evaluate it and consider how appropriate it is for economics.