Redefining Reality - The Intellectual Implications of Modern Science

Economics became a science with the formulation of the ideal type
of
and completely self-interested. The behavior of such a being in the
marketplace would be predictable, and the large-scale movements of the
economy would be determinable from the properties of the individual. But
in the 20 th century, the classical picture was undermined, both in terms of the
macro picture deriving from small-scale interactions and because humans
are indeed neither perfectly rational nor completely self-interested.
Economics as a science began in the 18 th century when relations
among production, consumption, scarcity, and price began to be
formulated. In the shadow of Newton’s work on mechanics and
physical system.
The problem, of course, is that physics deals with objects that
have no will. People, in contrast, are seemingly not bound by
deterministic rules.
Hence, a science of economics seemed to some to be
in well-regulated, predictable ways.
Early economists objected that this romanticized image of
the capricious human who acts however he or she wants at all
times is an empirical matter. If we look at the functioning of the
marketplace, we actually observe a well-regulated system that acts
and reacts in predictable ways. Human choices are not random; to
the contrary, we can fully understand why humans do what they do
in the marketplace in a quite straightforward way.
181