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Date: | Fri Mar 31 17:19:21 2006 |
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----------------- HES POSTING -----------------
Lawrence Moss writes:
>To summarize, what is exogenous and endogenous is imposed on the
>real world by the human mind.
I agree. And I would add that it depends on the problem at hand. An
excellent example of a theorist aware of this is Keynes. In Ch. 18 of the
General Theory, he first re-states his argument by listing the dependent
and independent variables and what he takes as given ("this does not
mean that we assume these factors to be constant; but merely that, in
this place and context, we are not considering or taking into account
the effects and consequences of changes in them". p. 245) and by
explaining how they are causally linked. He explains (p. 247):
"The division of the determinants of the economic system into the two
groups of given factors and independent variables is, of course, quite
arbitrary from any absolute standpoint. The division must be made
entirely on the basis of experience, so as to correspond on the one
hand to the factors in which the changes seem to be so slow or so little
relevant as to have only a small and comparatively negligible short-term
influence on our quesitum; and on the other hand to those factors in
which the changes are found in practice to exercise a dominant
influence on our quesitum. Our present object is to discover what
determines at any time the national income of a given economic system
and .. the amount of its employment; which means in a study so
complex as economics, in which we cannot hope to make completely
accurate generalisations, the factors whose changes *mainly* determine
our quesitum. Our final task might be to select those variables which
can be deliberately controlled or managed by central authority in the
kind of system in which we actually live".
Daniele Besomi
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