Parsimony - The theory must employ a minimum number of assumptions
and entities to explain the maximum number of observed economic
behaviours.
h. Explanatory Powers - It must explain the behaviour of economic
actors, their decisions, and why economic events develop the way they
do.
i. Predictive (prognostic) Powers - Economic theory must be able to
predict future economic events and trends as well as the future
behaviour of economic actors.
j. Prescriptive Powers - The theory must yield policy prescriptions,
much like physics yields technology. Economists must develop "economic
technology" - a set of tools, blueprints, rules of thumb, and
mechanisms with the power to change the " economic world".
k. Imposing - It must be regarded by society as the preferable and
guiding organizing principle in the economic sphere of human behaviour.
l. Elasticity - Economic theory must possess the intrinsic abilities to
self organize, reorganize, give room to emerging order, accommodate new
data comfortably, and avoid rigid reactions to attacks from within and
from without.
Many current economic theories do not meet these cumulative criteria
and are, thus, merely glorified narratives.
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