A theory fails a reality test

April 28th, 2013 by Rick Drain


There’s a joke among economists, “We can see that this works in practice, but we’re not sure it works in theory.”

Unlike in real sciences, economists hold on to theories long after the actual data has swept them aside.

A blogger offers a good example of a theory and the data that falsifies it.


There’s a good reason why almost all major economies abandoned free market economics. It’s that such economies didn’t and couldn’t avoid mass unemployment.

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