Don’t Study Economics As A Martian

Bart Remes

Bart Remes

Bart Remes is the founder of Economics in Action, an international coaching, training and strategy provider.

Studying Economics as a Martian

A Martian is observing Grand Central Station in New York.

He is bedazzled by what he sees. Bodies wandering around aimlessly. He is curious and wants to understand what is going on.

Then he notices that when the small hand on the station clock points to eight, there is a lot of movement as bodies come out of boxes. And after a while, when the little hand is at five, bodies enter the boxes which then crawl away over two metal stripes.

This is a great observation and there is nothing wrong with it. It is even possible for the Martian to come up with a prediction about the little hand on the clock and the movement of the bodies and the boxes.

But that is all the Martian would understand. His scientific understanding of the data from Grand Central Station remains limited. The bodies remain a mystery to him.

The difference between the economic sciences and natural sciences is that we are what we study. We possess knowledge from within. Natural science relies on knowledge from without.

Economics is fundamentally the study of human choice and action. All human choice and action is done with a purpose in mind (sneezing is not purposeful action; it is a reflexive action).

The economist would see the bodies’ purpose. It is to get from home to the train to work in the morning, and the opposite at night. We can understand the purposes and actions of other human actors because we are ourselves human actors.

If you want to understand how the world works, my suggestion is not to study economics as a Martian.

 

This article is reposted from here.

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Bart Remes

Bart Remes

Bart Remes is the founder of Economics in Action, an international coaching, training and strategy provider.