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Chapter 2

Introduction to Heterodoxy

Part A: Concepts and Definitions

Heterodoxy:

The prefix hetero in ancient Greek

means other or different.

The word doxy refers to a doctrine, a

framework of analysis, or what many

social scientists would call a paradigm.

Heterodoxy thus suggests a set of

ideas, perspectives, and models that are

in some way different from the orthodox,or normal, paradigm.

Heterodoxy:

The prefix hetero in ancient Greek

means other or different.

The word doxy refers to a doctrine, a

framework of analysis, or what manysocial scientists would call a paradigm.

Heterodoxy thus suggests a set of

ideas, perspectives, and models that are

in some way different from the orthodox,or normal, paradigm.

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Heterodoxy:

The prefix hetero in ancient Greek

means other or different.

The word doxy refers to a doctrine, a

framework of analysis, or what many

social scientists would call a paradigm.

Heterodoxy thus suggests a set of

ideas, perspectives, and models that are

in some way different from the orthodox,or normal, paradigm.

The orthodox paradigm in economics isthe neoclassical paradigm.

Rather than reject the neoclassicalparadigm, this textbook definesheterodoxy simply as a multi-paradigmatic.

Heterodox economists are notnecessarily anti-neoclassical, but theydo firmly reject the idea that economicphenomena can be accuratelyunderstood and analyzed entirely from

within the neoclassical paradigm.

The orthodox paradigm in economics isthe neoclassical paradigm.

Rather than reject the neoclassicalparadigm, this textbook definesheterodoxy simply as a multi-

paradigmatic. Heterodox economists are not

necessarily anti-neoclassical, but theydo firmly reject the idea that economicphenomena can be accuratelyunderstood and analyzed entirely fromwithin the neoclassical paradigm.

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The orthodox paradigm in economics isthe neoclassical paradigm.

Rather than reject the neoclassical

paradigm, this textbook definesheterodoxy simply as a multi-paradigmatic.

Heterodox economists are notnecessarily anti-neoclassical, but theydo firmly reject the idea that economicphenomena can be accuratelyunderstood and analyzed entirely fromwithin the neoclassical paradigm.

Holism: A Central Principle of Heterodoxy

Heterodox economics embraces holism and thescientific method, as every social scienceshould.

It is careful to distinguish its holistic scientifica roach from the scientific reductionism oforthodox neoclassical economics.

Heterodox economics seeks to identify andactively compensate for the biases inherent inany one paradigm, which enables scientifichonesty in the study of the complexity anduncertainty of human existence.

Holism: A Central Principle of Heterodoxy

Heterodox economics embraces holism and thescientific method, as every social scienceshould.

It is careful to distinguish its holistic scientific

a roach from the scientific reductionism oforthodox neoclassical economics.

Heterodox economics seeks to identify andactively compensate for the biases inherent inany one paradigm, which enables scientifichonesty in the study of the complexity anduncertainty of human existence.

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Holism: A Central Principle of Heterodoxy

Heterodox economics embraces holism and thescientific method, as every social science

should. It is careful to distinguish its holistic scientific

a roach from the scientific reductionism oforthodox neoclassical economics.

Heterodox economics seeks to identify andactively compensate for the biases inherent inany one paradigm, which enables scientifichonesty in the study of the complexity anduncertainty of human existence.

Holism

The holistic approach to understanding, whichis the simultaneous focus on the parts and thesystemic interactions of those parts, has beenpursued in many fields.

For example, the sociologist Emile Durkheimargue a soc e y s no a co ec on oindividuals; rather, it is a community that cantake on many different forms, depending onhow a group of individuals organizes itself.

Economist Kenneth Boulding described holismas links the specific that has no meaning and

the general that has no content.

Holism

The holistic approach to understanding, whichis the simultaneous focus on the parts and thesystemic interactions of those parts, has beenpursued in many fields.

For example, the sociologist Emile Durkheimargue a soc e y s no a co ec on oindividuals; rather, it is a community that cantake on many different forms, depending onhow a group of individuals organizes itself.

Economist Kenneth Boulding described holismas links the specific that has no meaning andthe general that has no content.

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Holism

The holistic approach to understanding, whichis the simultaneous focus on the parts and the

systemic interactions of those parts, has beenpursued in many fields.

For example, the sociologist Emile Durkheimargue a soc e y s no a co ec on oindividuals; rather, it is a community that cantake on many different forms, depending onhow a group of individuals organizes itself.

Economist Kenneth Boulding described holismas links the specific that has no meaning andthe general that has no content.

In addition to its systemic focus, holism views

human existence across disciplinary

boundaries.

Holism also views events as part of an

Holism

,

current, and future events.

In sum, holism implies a systemic approach

that seeks inter-disciplinary perspectives and

views events as part of an evolutionary, ever-

changing process.

In addition to its systemic focus, holism views

human existence across disciplinary

boundaries.

Holism also views events as part of an

Holism

,current, and future events.

In sum, holism implies a systemic approach

that seeks inter-disciplinary perspectives and

views events as part of an evolutionary, ever-

changing process.

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In addition to its systemic focus, holism views

human existence across disciplinary

boundaries. Holism also views events as part of an

Holism

,

current, and future events.

In sum, holism implies a systemic approach

that seeks inter-disciplinary perspectives and

views events as part of an evolutionary, ever-

changing process.

Holism and Systemic Instability

Karl Marx predicted the imminent collapse ofcapitalism in the 19th century.

Hyman Minskys financial instability hypothesispredicts that in a capitalist system every economicboom triggers a financial crash.

In ecology, Lovelocks Gaia hypothesis, whichstates that the planet Earth functions as a largehomeostatic organism that actively adjusts itsinternal natural conditions, contrasts with WardsMedea hypothesis, namely that the Earths systemto adjust in ways that could overwhelm humans

own homeostatic adjustment mechanisms.

Holism and Systemic Instability

Karl Marx predicted the imminent collapse ofcapitalism in the 19th century.

Hyman Minskys financial instability hypothesispredicts that in a capitalist system every economic

boom triggers a financial crash. In ecology, Lovelocks Gaia hypothesis, which

states that the planet Earth functions as a largehomeostatic organism that actively adjusts itsinternal natural conditions, contrasts with WardsMedea hypothesis, namely that the Earths systemto adjust in ways that could overwhelm humansown homeostatic adjustment mechanisms.

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Holism and Systemic Instability

Karl Marx predicted the imminent collapse ofcapitalism in the 19th century.

Hyman Minskys financial instability hypothesispredicts that in a capitalist system every economicboom triggers a financial crash.

In ecology, Lovelocks Gaia hypothesis, whichstates that the planet Earth functions as a largehomeostatic organism that actively adjusts itsinternal natural conditions, contrasts with WardsMedea hypothesis, namely that the Earths systemto adjust in ways that could overwhelm humansown homeostatic adjustment mechanisms.

Scientific Holism

Scientific reductionism assumes that we canunderstand the whole by learning about its parts,one part at a time., and that the whole is the is apredictable sum of its parts.

Holistic scientists, in contrast, accept that in a,

understand not just the parts, but also how theparts interact.

Because the human activity is a component of acomplex dynamic process, scientific reductionismis clearly not scientific because it ignores howinteractions between the components of a systemdetermine the outcomes of the overall system.

Scientific Holism

Scientific reductionism assumes that we canunderstand the whole by learning about its parts,one part at a time., and that the whole is the is apredictable sum of its parts.

Holistic scientists, in contrast, accept that in a,

understand not just the parts, but also how theparts interact.

Because the human activity is a component of acomplex dynamic process, scientific reductionismis clearly not scientific because it ignores howinteractions between the components of a systemdetermine the outcomes of the overall system.

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Scientific Holism

Scientific reductionism assumes that we canunderstand the whole by learning about its parts,one part at a time., and that the whole is the is a

predictable sum of its parts. Holistic scientists, in contrast, accept that in a

,understand not just the parts, but also how theparts interact.

Because the human activity is a component of acomplex dynamic process, scientific reductionismis clearly not scientific because it ignores howinteractions between the components of a systemdetermine the outcomes of the overall system.

The Heterodox Approach

The Steps of the Scientific Method:

1. Carefully and accurately observe some phenomenonor fact; this constitutes a scientific observation.

2. Use reason to invent a hypothesis, which is acarefully stated or presented relationship or idea thataccurately and logically explains the facts youobserve.

3. Confront the hypothesis with real world outcomes orperform experiments to generate outcomes that canbe compared to the hypothesis predicted outcomes.

4. Perform many experiments or observe large amountsof real world outcomes under a variety ofcircumstances in order to avoid conclusions driven byunseen forces not taken into consideration in yourhypothesis, observations, and experiments.

The Heterodox Approach

The Steps of the Scientific Method:

1. Carefully and accurately observe some phenomenonor fact; this constitutes a scientific observation.

2. Use reason to invent a hypothesis, which is acarefully stated or presented relationship or idea thataccurately and logically explains the facts you

observe.3. Confront the hypothesis with real world outcomes or

perform experiments to generate outcomes that canbe compared to the hypothesis predicted outcomes.

4. Perform many experiments or observe large amountsof real world outcomes under a variety ofcircumstances in order to avoid conclusions driven byunseen forces not taken into consideration in yourhypothesis, observations, and experiments.

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The Heterodox Approach

The Steps of the Scientific Method:

1. Carefully and accurately observe some phenomenonor fact; this constitutes a scientific observation.

2. Use reason to invent a hypothesis, which is acarefully stated or presented relationship or idea thataccurately and logically explains the facts youobserve.

3. Confront the hypothesis with real world outcomes orperform experiments to generate outcomes that canbe compared to the hypothesis predicted outcomes.

4. Perform many experiments or observe large amountsof real world outcomes under a variety ofcircumstances in order to avoid conclusions driven byunseen forces not taken into consideration in yourhypothesis, observations, and experiments.

The Heterodox Approach

The Steps of the Scientific Method:

1. Carefully and accurately observe some phenomenonor fact; this constitutes a scientific observation.

2. Use reason to invent a hypothesis, which is acarefully stated or presented relationship or idea thataccurately and logically explains the facts youobserve.

3. Confront the hypothesis with real world outcomes orperform experiments to generate outcomes that canbe compared to the hypothesis predicted outcomes.

4. Perform many experiments or observe large amountsof real world outcomes under a variety ofcircumstances in order to avoid conclusions driven byunseen forces not taken into consideration in yourhypothesis, observations, and experiments.

The Heterodox Approach

The Steps of t he Scientific Method

5. Record everything you do and observe, so that otherscan see exactly how your hypothesis was tested.

6. Carefully examine whether all the observed outcomesconsistently conform with your hypothesis.

7. If these tests of your hypothesis reveal that the real world

outcomes or ex erimental outcomes are not consistent withyour hypothesis, modify your hypothesis and return to step 2.

8. If your experiments, observations, or other objective testsconsistently confirm your hypothesis, your hypothesisbecomes a theory (a confirmed hypothesis). The scientistmust publish all results, accompanied by all the details of thetests that confirm the hypothesis so that others can replicatethe experiments and confirm the methods and results.

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The Heterodox Approach

The Steps of t he Scientific Method

5. Record everything you do and observe, so that otherscan see exactly how your hypothesis was tested.

6. Carefully examine whether all the observed outcomesconsistently conform with your hypothesis.

7. If these tests of your hypothesis reveal that the real worldoutcomes or experimental outcomes are not consistent withyour hypothesis, modify your hypothesis and return to step 2.

8. If your experiments, observations, or other objective testsconsistently confirm your hypothesis, your hypothesisbecomes a theory (a confirmed hypothesis). The scientistmust publish all results, accompanied by all the details of thetests that confirm the hypothesis so that others can replicatethe experiments and confirm the methods and results.

The Heterodox Approach

The Steps of t he Scientific Method

5. Record everything you do and observe, so that otherscan see exactly how your hypothesis was tested.

6. Carefully examine whether all the observed outcomesconsistently conform with your hypothesis.

7. If these tests of your hypothesis reveal that the real worldoutcomes or ex erimental outcomes are not consistent withyour hypothesis, modify your hypothesis and return to step 2.

8. If your experiments, observations, or other objective testsconsistently confirm your hypothesis, your hypothesisbecomes a theory (a confirmed hypothesis). The scientistmust publish all results, accompanied by all the details of thetests that confirm the hypothesis so that others can replicatethe experiments and confirm the methods and results.

The Heterodox Approach

The Steps of t he Scientific Method

5. Record everything you do and observe, so that otherscan see exactly how your hypothesis was tested.

6. Carefully examine whether all the observed outcomesconsistently conform with your hypothesis.

7. If these tests of your hypothesis reveal that the real world

outcomes or ex erimental outcomes are not consistent withyour hypothesis, modify your hypothesis and return to step 2.

8. If your experiments, observations, or other objective testsconsistently confirm your hypothesis, your hypothesisbecomes a theory (a confirmed hypothesis). The scientistmust publish all results, accompanied by all the details of thetests that confirm the hypothesis so that others can replicatethe experiments and confirm the methods and results.

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The Heterodox Approach

The Scientific Method:

The scientific method naturally demands that we

take a holistic approach when we analyzecomplex systems such as the global economyand the social and natural systems within wh ichhumans carr out economic activities.

Science and holi sm are fully compatible, and theirjoi nt appli cati on c an be termed hol ist ic science.

In general, holistic science is the scientific studyof complex systems.

The textbook describes how orthodox economicsuses scientific reductionist models; be sure toread that discussion to see how this textbookdiffers from other mainstream textbooks.