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Reactivity in Economic Science

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  • Bruno S. Frey

Abstract

There is a fundamental difference between the natural and the social sciences due to reactivity. This difference remains even in the age of Artificially Intelligent Learning Machines and Big Data. Many academic economists take it as a matter of course that economics should become a natural science. Such a characterization misses an essential aspect of a social science, namely reactivity, i.e. human beings systematically respond to economic data, and in particular to interventions by economic policy, in a foreseeable way. To illustrate this finding, I use three examples from quite different fields: Happiness policy, World Heritage policy, and Science policy.

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  • Bruno S. Frey, 2017. "Reactivity in Economic Science," CREMA Working Paper Series 2017-10, Center for Research in Economics, Management and the Arts (CREMA).
    • Handle: RePEc:cra:wpaper:2017-10
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    References listed on IDEAS

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    1. Frey, Bruno S. & Stutzer, Alois, 2010. "Recent Advances in the Economics of Individual Subjective Well-Being," Working papers 2010/04, Faculty of Business and Economics - University of Basel.
    2. Bruno S. Frey, 2018. "Economics of Happiness," SpringerBriefs in Economics, Springer, number 978-3-319-75807-7, March.
    3. Bruno S. Frey, 1997. "Not Just for the Money," Books, Edward Elgar Publishing, number 1183, December.
    4. Brunner, Karl & Meltzer, Allan H., 1976. "The Phillips curve," Carnegie-Rochester Conference Series on Public Policy, Elsevier, vol. 1(1), pages 1-18, January.
    5. George Soros, 2013. "Fallibility, reflexivity, and the human uncertainty principle," Journal of Economic Methodology, Taylor & Francis Journals, vol. 20(4), pages 309-329, December.
    6. Reto Cueni & Bruno S. Frey, 2014. "Forecasts and Reactivity," CREMA Working Paper Series 2014-10, Center for Research in Economics, Management and the Arts (CREMA).
    7. Richard A. Easterlin (ed.), 2002. "Happiness in Economics," Books, Edward Elgar Publishing, number 2479, December.
    8. Frey, Bruno S & Stutzer, Alois, 2000. "Happiness, Economy and Institutions," Economic Journal, Royal Economic Society, vol. 110(466), pages 918-938, October.
    9. Ariel Rubinstein, 2017. "Comments on Economic Models, Economics, and Economists: Remarks on Economics Rules by Dani Rodrik," Journal of Economic Literature, American Economic Association, vol. 55(1), pages 162-172, March.
    10. Roman Frydman & Edmund S. Phelps (ed.), 2013. "Rethinking Expectations: The Way Forward for Macroeconomics," Economics Books, Princeton University Press, edition 1, volume 1, number 10002.
    11. Bruno S. Frey, 2008. "Happiness: A Revolution in Economics," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262062771, December.
    12. Lucas, Robert Jr, 1976. "Econometric policy evaluation: A critique," Carnegie-Rochester Conference Series on Public Policy, Elsevier, vol. 1(1), pages 19-46, January.
    13. Andrew Clark & Sarah Flèche & Richard Layard & Nattavudh Powdthavee & George Ward, 2017. "Origins of happiness," CentrePiece - The magazine for economic performance 497, Centre for Economic Performance, LSE.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Economics; Social; Natural Science; Reactivity; Data; Happiness; Economic Policy;
    All these keywords.

    JEL classification:

    • A10 - General Economics and Teaching - - General Economics - - - General
    • B40 - Schools of Economic Thought and Methodology - - Economic Methodology - - - General
    • C70 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - General
    • C80 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - General
    • D80 - Microeconomics - - Information, Knowledge, and Uncertainty - - - General
    • Z10 - Other Special Topics - - Cultural Economics - - - General

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