Philosophico-Methodological Analysis of Prediction and its Role in Economics (Theory and Decision Library A: Book 50)

This book develops a philosophico-methodological analysis of prediction and its role in economics. Prediction plays a key role in economics in various ways. It can be seen as a basic science, as an applied science, and in the application of this science. First, it is used by economic theory in order to test the available knowledge. In this regard, prediction has been presented as the scientific test for economics as a science. Second, prediction provides a content regarding the possible future that can be used for prescription in applied economics. Thus, it can be used as a guide for economic policy, i.e., as knowledge concerning the future to be employed for the resolution of specific problems. Third, prediction also has a role in the application of this science in the public arena. This is through the decision-making of the agents -- individuals or organizations -- in quite different settings, both in the realm of microeconomics and macroeconomics. Within this context, the research is organized in five parts, which discuss relevant aspects of the role of prediction in economics: I) The problem of prediction as a test for a science; II) The general orientation in methodology of science and the problem of prediction as a scientific test; III) The methodological framework of social sciences and economics: Incidence for prediction as a test; IV) Epistemology and methodology of economic prediction: Rationality and empirical approaches; and V) Methodological aspects of economic prediction: From description to prescription. Thus, the book is of interest for philosophers and economists as well as policy-makers seeking to ascertain the roots of their performance. The style used lends itself to a wide audience Front Matter....Pages i-xx Front Matter....Pages 1-2 The Philosophico-Methodological Standpoint: The Issue of Prediction as a Requisite for Science....Pages 3-46 Characterization of Scientific Prediction and its Kinds in Economics....Pages 47-76 Front Matter....Pages 77-78 Falsificationism and the Methodological Levels on Prediction....Pages 79-101 Prediction and Novel Facts in the Methodology of Scientific Research Programs....Pages 103-124 Front Matter....Pages 125-126 From Erklären–Verstehen to Prediction–Understanding : The Methodological Framework for Prediction in Economics within Social Sciences....Pages 127-147 Methodological Approaches within Economics: The Perspectives on Prediction of Some Nobel Prize Winners....Pages 149-170 The Problem of Prediction in Economics from the Perspective of Action Theory....Pages 171-199 Front Matter....Pages 201-202 Rationality in Economics and Scientific Prediction: The Role of Economic Rationality in Prediction....Pages 203-228 Rationality and Prediction in Experimental Economics: An Analysis of Reinhard Selten’s Approach....Pages 229-247 Front Matter....Pages 249-250 Methods of Prediction in Economics....Pages 251-284 Evaluation and Limits of Prediction in Economics....Pages 285-315 The Relation Between Prediction and Prescription in Economics....Pages 317-341 Back Matter....Pages 343-362