----------------- HES POSTING ----------------- Roy W. has beaten me to the punch with his mention of the Morgan and Morrison book on modelling, which I highly recommend to those interested in the relation between models, theories and empirical data. The book also has several excellent case studies in the historical explanation of model building in economics and the natural sciences. The conversation on this thread has moved quickly from the historical question of when the notion of perfect knowledge was first employed to other issues (some of which were, of course, included in the original posting). While I don't think that historical and philosophical questions are unrelated, it seems to me that providing a philosophical justification for the place of the perfect knowledge assumption in economic theory is not the same as providing a historical account of how the notion came to be adopted, and how it was used not only by its initial users but by later economists. For example, let's presume that the notion of "perfect knowledge" enters economics in the first part of the twentieth century and that Knight played an important role in its adoption. Now, Knight provides a philosophical justification for the adoption of the assumption which is quite similar to that suggested by others in this thread, both in what Patrick Gunning calls its "simplifying" and its "counterfactual" aspects. But there is more to Knight's adoption and propogation of the assumption than its philosophical and economic arguments. Knight layers these arguments on top of notions of knowledge emerging in the early 20th century in psychology, combines them with his interests in causality and probability theory, axiomatizes them because of his background in the sciences, and aims them at both his economic and ideological opponents. Understanding Knight's use of the term "perfect knowledge", therefore, requires a "thick" explanation. I would presume that a similarly thick explanation would be required to explain later uses of the assumption (although I would agree with Robert and Patrick that, in any scientific discipline, assumptions become codified and normalized and therefore their use becomes less problematic to the practitioner). So I would frame the questions this way: can we explain how the "perfect knowledge" assumption was employed during the early 20th century, why it came to be employed in that way, how its new role was different than the role of previous notions of human knowledge in economic theory, and how its role evolved? Hints of answers to these questions have already been suggested in this conversation thread. I'll mention the ones I remember, plus a few others: new understandings of what it means to do science; a raging battle over economic theory on many fronts with unclear battle lines; interest in the relation between cognitive psychology, the theory of knowledge, and economic action; new mathematical techniques; the emergence of American Pragmatism; and an increased role for economists in public service. Ross Emmett ------------ FOOTER TO HES POSTING ------------ For information, send the message "info HES" to [log in to unmask]