Encyclopedia of Political Economy (2 Volume Set)

Rating:
Summary: No coherent definition and/or analysis of uncertainty
Review: This encyclopedia is for true believers in the Post Keynesian tradition of Joan Robinson,G L S Shackle and Paul Davidson.Unfortunately, this approach to economics can't operationalize any of the analytic tools and concepts Keynes developed in the A Treatise on Probability in 1921(TP)or in the General Theory in 1936(GT).An obvious place to start is the failure of Post Keynesians to operationalize Keynes's concepts of the weight of the evidence in the TP,uncertainty in the GT and probability in both the TP and GT.Keynesian probability is fundamentally of an interval nature.It is quantitative and at the same time noncomparative,nonrankable,and incommensurable if any of the interval estimates overlap.The source of this analysis is chapters 15,17,20,and 22 of the TP.Weight of the evidence,w,is an index that measure the completeness of the relevant,potential,available evidence upon which probability estimates will be based.Keynes defined it as 0<=w<=1.If w=0,then you are dealing with what Keynes called ignorance in the TP.A w=0 would also hold in the 1937 Quarterly Journal of Economics article if"We simply do not know!"Other names would be complete or total uncertainty or the fundamental uncertainty of the Shackles and the Davidsons.w's between 0 and 1 represent cases of partial knowledge and partial ignorance.Here a set of different probability distributions or a set of intervals would have to be constructed.A w=1 allows a decision maker to specify a single unique probability distribution or interval.Given a strict application of the central limit theorem and the law of large numbers,suppose that the data passed the Lexis Q-test for stability.Keynes would then agree that one could apply a normal probability distribution since an analysis of the data would support such a conclusion as long as the data was homogeneous in its composition throughout the series or sequence.Now let us turn to the GT.Keynes was quite clear that uncertainty is a function of the weight of the evidence.As the weight of the evidence increases,uncertainty decreases.As the weight of the evidence decreases,uncertainty increases.u=f(w).If w=0,then uncertainty is total and no estimates of probability are possible.In this case,the decision maker would exhibit a very high liquidity preference and tend to rely on hueristics,rules of thumb,habits,memory,conventions or a follow the crowd approach.

Rating:
Summary: A great general resource for the social sciences
Review: This is a great general resource for people, and especially students, interested in the social sciences. The area of Political Economy defines a broad subject matter incorporating economics, political science, sociology and History (at least), from a leftist point of view. There are excellent essays on topics relating to each of these areas that have helped me understand, at long last, those college classes I took oh, so long ago. I wrote the essay on the Informal Sector, but there are over 300 other essays that are really worth looking at. Each essay has a short list of publications in the field that can help jump-start a more in-depth research project.