Theory vs. reality in economics

Authors

DOI:

https://doi.org/10.30972/rfce.3327899

Keywords:

assumptions, prediction, model, similarity, evolution

Abstract

The starting point of this article is that economics is an applied science. It is a tool for understanding real-world economics and a guide for economic policy. Economic theory must start at the real world – the assumptions must be realistic – and the destination point must also be the real world. The selection of assumptions plays a fundamental role if economic theory is to serve the purpose of interpreting reality. The key issue is the similarity between the theoretical model and the real world.  Economic phenomena occur over time. The temporal dimension of economic phenomena cannot be ignored. The evolutionary approach aims to analyze the economy as the result of a dynamic process that leads from known or plausibly conjectured initial conditions in the past to the reality under analysis. 

Author Biography

Víctor Alberto Beker, Universidad de Belgrano. Universidad de Buenos Aires

Director del Centro de Estudios de la Nueva Economía de la Universidad de Belgrano y Profesor Titular Consulto de la Universidad de Buenos Aires. Exdirector Nacional de Estadísticas de las Actividades Productivas del INDEC. Fue profesor invitado con rango de Catedrático en la Universidad de Salamanca e Investigador Invitado en el C.V. Starr Centre for Applied Economics de la New York University. Premio Salvador Aisenstein del Colegio de Graduados en Ciencias Económicas y Premio Academia Nacional de Ciencias de Buenos Aires. Autor de libros y artículos en la especialidad; el más reciente, Economic Theory for the Real World. Routledge, 2024.

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Published

2024-12-02

How to Cite

Beker, V. A. (2024). Theory vs. reality in economics. Revista De La Facultad De Ciencias Económicas, 33(2), 1–12. https://doi.org/10.30972/rfce.3327899

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Autores invitados