Clarifying Popper (Bruce J.

Caldwell)
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 DEMARCATION & CRITIQUE OF
INTRODUCTION SITUATIONAL ANALYSIS CRITICAL RATIONALISM
FALSIFICATION FALSIFCATIONISM IN ECO

THE MAN

• Sir Karl Popper

• Philosopher of Science
• Logic of Scientific Discovery

THEORIES EXAMINED

1. Falsificationism and demarcation

2. Situational Analysis
3. Critical Rationalism

RECOMMENDED READING LEVEL

1. Significance of Popper in Economics

2. Critical assessment of existing Literature
3. Unambiguous interpretation of Popper

Refutationism suggests that point of contact can be used to explore errors (Senge & Bell)
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WHY?

• Logical positivists and Vienna Circle

• Verifiability
• Popper questioned the statement and the
explanation

UNIVERSAL STATEMENTS

• Not so obvious universal statements:

• Gravity
• Relativity

ADVANTAGES OF REFUTABILITY

• Error before adjustments

• Importance of Causal explanations

Popper uses the phrase adhoc theory adjustment to refer to any change in theory designed solely to save it from
refutation
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LACK OF CLEAN REFUTATION POPPER SAYS

• Duhem-Quine thesis “Acknowledge the difficulty and insist that, whenever a refutation is encountered, any proposed
theory modification be free of the taint of immunizing stratagem”

The key challenge in Popper’s method is to spot outliers that refute a theory
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POPPER ON SITUATIONAL LOGIC

• Trace the unintended social repercussions Even though the rationality principle is an empirical conjecture that turns out to be false, it "does
of intentional human actions not play the role of an empirical explanatory theory, of a testable hypothesis" . The assumption
• Individualistic but not psychologistic that agents act appropriately is never rejected. It is considered a kind of "zero principle," a
• Generalization starting point for the analysis. When a theory in which it is employed is falsified, Popper argues
• Rationality Principle "that it is sound methodological policy to decide not to make the rationality principle accountable
but the rest of the theory; that is, the model”

SUGGESTIONS

1. The first recommendation is to replace Popper's statement of how the method of situational logic works with the cleaner version provided by
Noretta Koertge.
2. The second concerns Popper's (possible) prescriptive claim that situational analysis is the only appropriate method in the social sciences. The
claim is amended to read that situational analysis is a powerful and fruitful method for social and other sciences, but that it need not be
considered the only viable method.

Consider other methods as well apart from Situational Analysis

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INTERPRETATIONS OF THE RATIONALITY PRINCIPLE

1. All agents act appropriately to the situation as they see it

2. A second way of interpreting the rationality principle is to view it as the equivalent of a universal law within the social sciences
3. Rationality principle may be interpreted as being neither an unfalsifiable universal statement nor a falsifiable (and falsified) statement of a
universal law. For it need not be considered a statement at all, but rather a methodological principle that is retained because it has shown to be
particularly fruitful in the past

SITUATIONAL ANALYSIS VS FALSIFICATIONISM

• Most economists would presumably accept situational analysis and reject Falsificationism
• Those who believe that the social sciences are not true sciences might be more likely to choose falsificationism over situational analysis
• Popper's writings on situational analysis as misguided or naïve
• Reject Popper's thought altogether as hopelessly confused

Author’s solution involves positing an alternative and broader conception of

acceptable scientific practice, one that would allow the use of both falsificationism
and situational logic, each within the contexts in which it is most appropriate.

Agents act appropriately to their situation.

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POPPER ON CRITICAL RATIONALISM

• "On the Nonexistence of Scientific Method" - Popper denies that there is a foolproof method for the discovery of scientific
theories or that there is a method for verifying the truth of scientific hypotheses. This is not a new position but simply a
restatement of fallibilism
• So-called method of science (Emphasis on criticism) - “The only things which partners in an argument must share are the wish to
know, and the readiness to learn from the other fellow, by severely criticizing his views-in the strongest possible version that can
be given to his views and hearing what he has to say in reply. I believe that the so-called method of science consists in this kind
of criticism. Scientific theories are distinguished from myths merely in being criticizable, and in being open to modifications in
the light of criticism
• Linchpin of Popper’s thought - Fallibilism and the critical approach
• Popper deals harshly with theories that are not criticizable; that do not try to solve problems; that do not provoke rational
criticism. He calls such theories "valueless" and "worthless," and states that scientists would be "well justified in dismissing
them"
• Popper endorses a critical attitude: "What distinguishes the attitude of rationality is simply openness to criticism". Popper
opposes any attempts to shield theories from criticism, as well as any attitude that does not give prominence to the critical
scrutiny of ideas
• Evolutionary epistemology provides the epistemological foundations for critical rationalism. This doctrine emphasizes the
similarities between the growth of animal (including human) knowledge and the evolution of species. Bold conjectures are
analogous to blind variations (mutations) in nature; the process of criticism is analogous to the process of natural selection
• The goal of the evolutionary epistemologist is to create an "ecology of rationality" in which the optimal amount of critical
discourse is able to flourish

Criticism is central to growth

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FALSIFICATIONISM VS SITUATIONAL ANALYSIS

• Critical rationalism states that sometimes it is appropriate to evaluate a theory using the strict empirical criteria of falsificationism. 
• But at other times, especially within the social sciences, one is better able to criticize a theory by applying the canons of situational
logic. 
• And there are still other circumstances, particularly when metaphysical theories are considered, when other routes to criticism are
preferable. 
• Which methods of criticism are most appropriate cannot be specified in advance: That will depend on the subject matter and the
problem to be solved. But one can say that within the ecology of rationality envisioned by the evolutionary epistemologist, the goal is
to subject all theories to the optimal amount of criticism

CRITICISM OF CRITICAL RATIONALISM

• Critical rationalism focuses too much attention on the question of theory appraisal. As a result, it is not very helpful for the
resolution of other problems facing economic methodology
• Least appropriate when new, alternative approaches are being tried out.
• Critical Rationalism does not have enough content

Contextual application of Situational Analysis and Falsificationism

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