Before writing, it's instructive to dredge Google to see how many people have, with more wit and expertise, already treated your topic. Blog proliferation means there will be many primaries, secondaries, and nibblers (I fit into this category). Of course, if I wrote only about the unwritten I'd sit on my hands all day. But information about quantity and quality of material may motivate a new publishing strategy.
In that spirit, instead of soap-boxing, here's a non-exhaustive list of resources supporting the obvious premise that economics/finance and physics are substantively different in method and explanatory and predictive success. Most argue that economics is harder than physics and our models of physical systems are better than our models of economic systems.
Of course, doing economics is not necessarily harder than doing physics. Comparing modeling precision between the two is like comparing field goal percentage vs. batting averages and concluding that basketball is harder than baseball. It's not. They're different. They have different measures of difficulty and success. Transposing the sets of working economists and physicists would not lead to an ascendancy of accuracy in the former, but maybe some decline in the latter. Disciplinary constraints disallow massive and rapid change.
Anyway, gadflying does little to reduce the contention that economic systems are, in some ways, more complex than physical ones because they have more intractable uncertainty. We have less epistemic access to system elements and relations. But beyond that, there persist significant differences in methodology: modeling goals, evidence, experimentation. And then there are complications of recursivity and "values." See the resources.
The Spengler (1) and my paper (6) are more about the positive-normative dichotomy in the history of economics, a debate which nonetheless turns on to what degree economics is a science and economists scientists. The Lo and Mueller (2) builds on Frank Knight on types of uncertainty as determinants of modeling precision. Fourcade (4) and Fox (5) provide comments. Black (5) summarizes. Gilboa et al. (7) are methodology-minded economists that formally model economic models as analogous to analogies.
Everybody quotes Richard Feynman (at a Caltech graduation):
1 Joseph J. Spengler, "Have Values a Place in Economics" 1934.
3 Marion Fourcade (sociology). "Paul Krugman: the wicked economist?"-- short.
4 Justin Fox. "Physicists don't love economists and other revelations." -- short, comic.
5 Dan Black. (power point) "On the intrinsic differences between the physical and social sciences." -- Nice introduction with formal example.
6 Turner, Bradley. 2009. "The economic dichotomy and investigator behavior." -- college essay.
7 Gilboa, et al. at the Penn Institute for Economic Research. "Economic Models as Analogies"
In that spirit, instead of soap-boxing, here's a non-exhaustive list of resources supporting the obvious premise that economics/finance and physics are substantively different in method and explanatory and predictive success. Most argue that economics is harder than physics and our models of physical systems are better than our models of economic systems.
Of course, doing economics is not necessarily harder than doing physics. Comparing modeling precision between the two is like comparing field goal percentage vs. batting averages and concluding that basketball is harder than baseball. It's not. They're different. They have different measures of difficulty and success. Transposing the sets of working economists and physicists would not lead to an ascendancy of accuracy in the former, but maybe some decline in the latter. Disciplinary constraints disallow massive and rapid change.
Anyway, gadflying does little to reduce the contention that economic systems are, in some ways, more complex than physical ones because they have more intractable uncertainty. We have less epistemic access to system elements and relations. But beyond that, there persist significant differences in methodology: modeling goals, evidence, experimentation. And then there are complications of recursivity and "values." See the resources.
The Spengler (1) and my paper (6) are more about the positive-normative dichotomy in the history of economics, a debate which nonetheless turns on to what degree economics is a science and economists scientists. The Lo and Mueller (2) builds on Frank Knight on types of uncertainty as determinants of modeling precision. Fourcade (4) and Fox (5) provide comments. Black (5) summarizes. Gilboa et al. (7) are methodology-minded economists that formally model economic models as analogous to analogies.
Everybody quotes Richard Feynman (at a Caltech graduation):
“Imagine how much harder physics would be if electrons had feelings!”But Joseph J. Spengler preceded him by a long shot.
1 Joseph J. Spengler, "Have Values a Place in Economics" 1934.
However the economist defines economics and its problems...he is dealing with relationships of man to man and of man to natural resources. The physicist, on the contrary, is merely dealing with waves, rays, protons, etc., per se. The geneticist is dealing with chromosomes, genes, etc., per se. Neither is dealing with the manner in which human communities employ rays, waves, genes, etc. The economist, therefore, faces what the physicist and the geneticist do not face, namely, questions impinging upon the value-scales which characterize modern society. For as the late Allyn Young remarked, "Every occurrence in the contemporary life is...a scientific datum, which has to be fitted into the ordered scheme of social processes. Every such occurrence has its own immediate and concrete significance, and has to be accorded its due weight in any system of social values...Of social processes we reserve the right to approve or disapprove."and later
"To postulate an opinionless economist is to postulate an empirically impossible creature (331)."2 Andrew Lo and Mark Mueller. 2010 (draft). "Warning: physics envy may be hazardous to your wealth!" simplified in the talk and blog post.
"Physics envy... this desire to explain 99.9% of all economic phenomena with three laws. That's what physicists do. In fact, we [economists] have 99 laws that explain 3% of phenomena." (from the talk)
3 Marion Fourcade (sociology). "Paul Krugman: the wicked economist?"-- short.
4 Justin Fox. "Physicists don't love economists and other revelations." -- short, comic.
5 Dan Black. (power point) "On the intrinsic differences between the physical and social sciences." -- Nice introduction with formal example.
6 Turner, Bradley. 2009. "The economic dichotomy and investigator behavior." -- college essay.
7 Gilboa, et al. at the Penn Institute for Economic Research. "Economic Models as Analogies"
"Indeed, there is no reason that it would be easier to predict stock market crashes than it would be to predict earthquakes. In fact, the opposite is true: because people react to theories, predicting human behavior has theoretical bounds beyond those that are shared by the natural sciences."
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