Economics: Between Prediction and Criticism
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We suggest that one way in which economic analysis is useful is by oﬀering a critique of reasoning. According to this view, economic theory may be useful not only by providing predictions, but also by pointing out weaknesses of arguments. It is argued that, when a theory requires a non-trivial act of interpretation, its roles in producing predictions and oﬀering critiques vary in a substantial way. We oﬀer a formal model in which these diﬀerent roles can be captured.
Gilboa, Itzhak; Postlewaite, Andrew; Samuelson, Larry; and Schmeidler, David, "Economics: Between Prediction and Criticism" (2014). Cowles Foundation Discussion Papers. 2367.