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Philosophy of Economics consists of inquiries concerning rational choice, the appraisal of

economic outcomes, institutions and processes, and the ontology of economic phenomena and

the possibilities of acquiring knowledge of them. Economics is concerned with aspects of the

production, exchange, distribution, and consumption of commodities and can be split up into

micro and macro economics. Economics is rooted in history. Socrates, Aristotle addressed

economical problems and people realized the significance of using taxes and the economy. Laws

were discovered to govern the complexities of economics. Contemporary economics is extremely

diverse and has many schools and many branches.

Few economists are satisfied with the attempts that have been made to unify microeconomics

and macroeconomics as economics is not one homogenous enterprise. Econometrics is a third

main branch of economics

Economics closely resembles the natural sciences but faces the problem of illegitimacy of severe

abstraction and idealization and overgeneralization like in the ceteris paribus clause. It isnt a

science as it tells the causes but does not provide the reasons for problems.

Before the 1930s, economists were willing to use causal language explicitly and literally, and

there was a search for larger theoretical structures that unify and guide research within particularresearch traditions. Proponents included Friedman, Kuhn, and Lakatos.

There are two important recent realist programs in economic methodology. The first, developed

mainly by Uskali Mki, is devoted to exploring the varieties of realism implicit in the

methodological statements and theoretical enterprises of economists. The second, which is

espoused by Tony Lawson and his co-workers, at Cambridge, which states that one can trace

many of the inadequacies of mainstream economics to an insufficient concern with ontology.

Throughout its history, economics has been the subject of sociological as well as methodological

scrutiny there have been substantial efforts to apply structuralist views of scientific theories to

economics

Nowadays the standard intellectual tool or form is a model which signals a methodological shift

in economics. In the past generation, experimental work in economics has expanded rapidly. It

depicts agents as to some extent rational, meaning the agent does not prefer any feasible

alternative to what he or she chooses. However, data from multistage ultimatum games do not

seem to agree.

A great deal of controversy surrounds the theory of rationality, and there have been many formal

investigations into weakened or amended theories of rationality. The theory of game theory states

that when outcomes depend on what several agents do, one agent's best choice may depend on

what other agents choose

Economics is relevant to policy because it provides information concerning the consequences ofpolicy. One central question of moral philosophy has been to determine what things are

intrinsically good for human beings and the prevailing view among economists has shifted from

hedonism to welfare and economists now make welfare evaluations of economic processes,

institutions, outcomes, and policies without making interpersonal comparisons.

Arthur Tan 5C21

Loh Shi Xun 5C13

7/30/2019 Philosophy of Economics(Summary)

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Zhai Rui 5C22

Samson Lee 5C41

Tan Jun Wei 5C41