Economics need a scientific revolution
Jean-Philippe Bouchaud (CFM)
TL;DR
This paper advocates for a fundamental shift in economics and financial engineering towards data-driven, realistic approaches, moving away from dogmatic axioms to better understand and address financial crises.
Contribution
It proposes a paradigm change in economics, emphasizing empirical data and plausible reasoning over strict axiomatic models.
Findings
Current financial crises reveal limitations of traditional axiomatic economics
A shift towards data-centric and plausible reasoning improves understanding of financial systems
Encourages a scientific revolution in economic thought and practice
Abstract
I argue that the current financial crisis highlights the crucial need of a change of mindset in economics and financial engineering, that should move away from dogmatic axioms and focus more on data, orders of magnitudes, and plausible, albeit non rigorous, arguments.
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Taxonomy
TopicsComplex Systems and Time Series Analysis · Economic, financial, and policy analysis