Introduction

Abstract

In 2012, the former head of the Federal Reserve, Alan Greenspan, was asked if his convictions on the merits of free markets had influenced his judgment and ability to design policies to prevent the financial crisis of 2008. Greenspan replied that it was now obvious that there was a basic mistake in the model that he thought of as the critical structure behind the world economy. Mirowski (1991) argues that the major equations of the ‘marginalist revolution’ that form the basis of neoclassical economics came straight from the theories of energetics. Energetics is the study of energy flows and storages. Because energy flows at all levels, from the quantum to the biosphere and cosmos, ‘energetics’ is a field encompassing thermodynamics, chemistry, biological ‘energetics,’ biochemistry, and ecological energetics. Mark Blaug (2002) calls neoclassical economics ‘sick, a soporific scholasticism of mathematical formalism where the slogan No reality, please, we’re economists rules.’ Capitalism, under the globalization process, is now a global religion. The alternative is possibly an Eastern approach to economics, an approach rooted in the culture and philosophy of the orient, particularly of Japan, India, and other Asian countries. This culture does not approve of the rationalism of Bentham and John Stuart Mill, which is the basis of Western (Anglo-American) economics. The Asian culture, particularly the Japanese culture, promotes cooperation, altruism, and working for the sake of the work, not for results.