Systematizing the Economic World

...Economics, which seems so often an art rather than a science, subject to all the human faults of scholars and dependent for guidance on philosophy, can hardly be methodized to the complete satisfaction of anyone in this fast-moving, involved world...

...The enormous complexity and size of the undertaking is recognized In the author when he says: "Even if we want an explanation with regard to a limited number of variables, such as prices, quantities of goods and income, we are led . . . to other magnitudes and values when we get to natural conditions, technology, the physical and mental qualities of human beings, social institutions and unique and historical phenomena...

...But the author suggests that incompetence may explain why economics has not followed the example of the successful natural sciences...

...Unlike many economic writers of the past, Mr...

...The skeptic will put it down with the reservations heretofore noted, reminding himself also that it is in the practical application of theory that the really formidable difficulties are encountered, regardless of how demonstrable all the links of presumed interdependence may appear...

...In a concluding part, he outlines the different types of monopolistic and competitive conditions and the impact of property, power and state action upon economic life...

...Altogether, the book is a comprehensive, scholarly, mathematically interesting, and exceedingly well documented work of primary interest to the economic student but with overtones of attraction to all the intellectually curious...

...But he does not despair, as the following quotation indicates: "It seems natural to consider the economic world, like the physical world, as one big continuum, where each particle has a close Connection with certain other particles, from which connections spread like a network or chain...

...Zeuthen recognizes, with modern enlightenment, the impossibility of writing down final truths for application under all circumstances...

...Reviewed by T. K. Quinn Author and business executive This book is an admirable translation from the Danish, revised and enlarged, performed by the author's wife...

...An English detective story, from which the author quotes, makes a case for theory in a conversation: " 'Don't you make theories as you go along, Pointer?' "'I like finding facts better.' Pointer thought...

...He covers the Swedish economists' contribution to dynamic theory, uncertainty, expectations and risk-bearing as well as trade in capital values...

...Upon this base, he proceeds to present abstract theory and method, largely in mathematical regalia, as one of the tools of the economist, affirmatively denying all attempts to Solve living, practical problems...

...This all-pervading interdependence in the economic world is not vague and uncertain, but consists of definite and demonstrable links such as demand and costs...

...The result, however, is reminiscent of Henry Adams's attempt, without committing himself, to squeeze history into the mathematical formulas of scientists...

...Zeuthen warns that the banning of all systematic thinking leads to unsystematic, personal and even self-interest fantasies...

...If competence is all that is required, it will have to be competence of a new and high order...

...Of course, if you cannot find a fact lying around, you have to fish for it with a theory.' " With all due respect for theory, the practical-minded reader must approach this work with great trepidation...

...Beginning with an examination of the character of economic reasoning, its relation to policy, and a classification of theories, the author follows the method of "decreasing abstraction," uses the static free-competition assumptions, and then broaches the theory of distribution dealing with demand and supply...

...The purpose of economics is a practical one: to enable us to forecast or influence economic activity...