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McCloskey commented in the intro to his intermediate micro text that
neoclassical analysis was simply gas diffusion theory brought over
from physics--each atom retains its momentum until influenced--externally--
by some force (e.g. relative price changes). And one can get a lot of
mileage out of that approach, as long as the atoms (molecules=firms?)
don't think/act. But as T. Schultz pointed out, it is in the interest
of actors to CREATE disequilibirum to de-stablize stability, because
there are advantages to be gained by doing so. Thus introduction of
humans into the equation guarantees that any formalized model will be
inherently wrong--because someone will be interested in making it wrong!
FC
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Prof. Fred V. Carstensen Office: (860) 486-0614
Department of Economics Dept: (860) 486-3022
341 Mansfield Road FAX: (860) 486-4463
University of Connecticut Home: (860) 242-6355
Storrs, CT 06269-1063 e-mail: [log in to unmask]
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