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Uncertainty and Fiction

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Uncertainty in Economics

Part of the book series: Contributions to Economics ((CE))

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Abstract

The economic theory of choice denies uncertainty to a large degree. In my previous chapters I have argued that this denial is both illegitimate from a philosophy of science perspective and misdirecting economics. Uncertainty is fundamental to economic phenomena and economic actions. However, so far it is not sufficiently represented in economic theories. Therefore, the conclusions of economic theories are not applicable to real political questions. In what follows, I suggest a theory of reasonable economic action under conditions of uncertainty. The theory describes how choice could be conceptualised under conditions of uncertainty.

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Notes

  1. 1.

    The concept of reasonableness is contrasted to the standard economic concept of rationality, which describes the marginalist ideal of utility maximization by means of numerical probabilities (objective probabilities under conditions of certainty and risk and subjective probabilities under conditions of uncertainty).

  2. 2.

    Much older forms of fictional literature are Epic and Lyric.

  3. 3.

    See also Beckert (2011: 7).

  4. 4.

    Beckert (2011: 7): “Since the future cannot be known, expectations are images of future states of the world which are taken by actors as if they were true. These are “Placeholders” in the decision-making process through which the unknowability of future states of the world and courses of events is overlooked for the moment.” See also Riles (2010).

  5. 5.

    This is what Soros (2013) had subsumed under the label of human fallibility.

  6. 6.

    See Shackle (1979).

  7. 7.

    The question of fiction selection is crucial for a theory of fictional choice and needs further research.

  8. 8.

    The process of choice is strongly influences and determined by feelings and intuitions and therefore cannot be interpreted as purely free will.

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Authors and Affiliations

  1. Berlin, Germany

    Julia Köhn

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  1. Julia Köhn
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Köhn, J. (2017). Uncertainty and Fiction. In: Uncertainty in Economics. Contributions to Economics. Springer, Cham. https://doi.org/10.1007/978-3-319-55351-1_11

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