IDEAS home Printed from https://ideas.repec.org/a/rjr/romjef/vy2012i4p17-35.html
   My bibliography  Save this article

Reconsideration of Dimensions and Curve Fitting Practice in View of Georgescu-Roegen’s Epistemology in Economics

Author

Listed:
  • Kozo Mayumi

    (Faculty of Integrated Arts and Sciences, The University of Tokushima, Minami-Josanjima 1-1, Tokushima City 770-8502, Japan.)

  • Mario Giampietro

    (ICREA Research Professor, Institute of Environmental Science and Technology (ICTA), Autonomous University of Barcelona (UAB), 08193 Bellaterra, Barcelona, Spain)

  • Jesus Ramos-Martin

    (Department of Economics and Economic History, and Institute of Environmental Science and Technology (ICTA), Autonomous University of Barcelona (UAB), 08193 Bellaterra, Barcelona,Spain)

Abstract

This paper is to examine the proper use of dimensions and curve fitting practices elaborating on Georgescu-Roegen’s economic methodology in relation to the three main concerns of his epistemological orientation. Section 2 introduces two critical issues in relation to dimensions and curve fitting practices in economics in view of Georgescu-Roegen’s economic methodology. Section 3 deals with the logarithmic function (ln z) and shows that z must be a dimensionless pure number, otherwise it is nonsensical. Several unfortunate examples of this analytical error are presented including macroeconomic data analysis conducted by a representative figure in this field. Section 4 deals with the standard Cobb-Douglass function. It is shown that the operational meaning cannot be obtained for capital or labor within the Cobb-Douglas function. Section 4 also deals with economists’ “curve fitting fetishism”. Section 5 concludes this paper with several epistemological issues in relation to dimensions and curve fitting practices in economics.

Suggested Citation

  • Kozo Mayumi & Mario Giampietro & Jesus Ramos-Martin, 2012. "Reconsideration of Dimensions and Curve Fitting Practice in View of Georgescu-Roegen’s Epistemology in Economics," Journal for Economic Forecasting, Institute for Economic Forecasting, vol. 0(4), pages 17-35, December.
    • Handle: RePEc:rjr:romjef:v::y:2012:i:4:p:17-35
    as

    Download full text from publisher

    File URL: http://www.ipe.ro/rjef/rjef4_12/rjef4_2012p17-35.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Deirdre N. McCloskey & Stephen T. Ziliak, 1996. "The Standard Error of Regressions," Journal of Economic Literature, American Economic Association, vol. 34(1), pages 97-114, March.
    2. Nicholas Georgescu-Roegen, 1979. "Methods in Economic Science," Journal of Economic Issues, Taylor & Francis Journals, vol. 13(2), pages 317-328, June.
    3. Mayumi, Kozo & Giampietro, Mario, 2010. "Dimensions and logarithmic function in economics: A short critical analysis," Ecological Economics, Elsevier, vol. 69(8), pages 1604-1609, June.
    4. Mayumi, Kozo & Giampietro, Mario & Gowdy, John M., 1998. "Georgescu-Roegen/Daly versus Solow/Stiglitz Revisited," Ecological Economics, Elsevier, vol. 27(2), pages 115-117, November.
    5. Lucas, Robert E, Jr, 1993. "Making a Miracle," Econometrica, Econometric Society, vol. 61(2), pages 251-272, March.
    6. Christensen, Laurits R & Jorgenson, Dale W & Lau, Lawrence J, 1973. "Transcendental Logarithmic Production Frontiers," The Review of Economics and Statistics, MIT Press, vol. 55(1), pages 28-45, February.
    7. Ramos-Martin, Jesus, 2003. "Empiricism in ecological economics: a perspective from complex systems theory," Ecological Economics, Elsevier, vol. 46(3), pages 387-398, October.
    8. Kevin Hoover & Mark Siegler, 2008. "Sound and fury: McCloskey and significance testing in economics," Journal of Economic Methodology, Taylor & Francis Journals, vol. 15(1), pages 1-37.
    9. H. S. Houthakker, 1955. "The Pareto Distribution and the Cobb-Douglas Production Function in Activity Analysis," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 23(1), pages 27-31.
    10. Islam, Saiful, 1985. "Effect of an essential input on isoquants and substitution elasticities," Energy Economics, Elsevier, vol. 7(3), pages 194-196, July.
    11. Douglass C. North, 2005. "Introduction to Understanding the Process of Economic Change," Introductory Chapters, in: Understanding the Process of Economic Change, Princeton University Press.
    12. Robert E. Lucas Jr., 2003. "Macroeconomic Priorities," American Economic Review, American Economic Association, vol. 93(1), pages 1-14, March.
    13. Pindyck, Robert S, 1979. "Interfuel Substitution and the Industrial Demand for Energy: An International Comparison," The Review of Economics and Statistics, MIT Press, vol. 61(2), pages 169-179, May.
    14. Robert E. Lucas, 2009. "Trade and the Diffusion of the Industrial Revolution," American Economic Journal: Macroeconomics, American Economic Association, vol. 1(1), pages 1-25, January.
    15. Morse, Stephen, 2006. "Making development simple. The genetic deterministic hypothesis for economic development," Ecological Economics, Elsevier, vol. 56(1), pages 79-88, January.
    16. Richmond, Amy K. & Kaufmann, Robert K., 2006. "Is there a turning point in the relationship between income and energy use and/or carbon emissions?," Ecological Economics, Elsevier, vol. 56(2), pages 176-189, February.
    17. A. C. Pigou & Milton Friedman & N. Georgescu-Roegen, 1936. "Marginal Utility of Money and Elasticities of Demand," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 50(3), pages 532-539.
    18. Ramos-Martin, Jesus & Giampietro, Mario & Mayumi, Kozo, 2007. "On China's exosomatic energy metabolism: An application of multi-scale integrated analysis of societal metabolism (MSIASM)," Ecological Economics, Elsevier, vol. 63(1), pages 174-191, June.
    19. Samuelson, Paul A, 1974. "Complementarity-An Essay on the 40th Anniversary of the Hicks-Allen Revolution in Demand Theory," Journal of Economic Literature, American Economic Association, vol. 12(4), pages 1255-1289, December.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Fix, Blair, 2013. "Human Activity, Energy & Money in the Unlted States: Connecting the Biophysical Economy with its Pecuniary Image," EconStor Theses, ZBW - Leibniz Information Centre for Economics, number 203120, September.
    2. Fix, Blair, 2019. "Human Activity, Energy & Money in the United States: Connecting the Biophysical Economy with its Pecuniary Image," Thesis Commons e74ng, Center for Open Science.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Kozo Mayumi & Mario Giampietro & Jesus Ramos-Martin, 2010. "A Critical Analysis of Dimensions and Curve Fitting Practice in Economics," UHE Working papers 2010_01, Universitat Autònoma de Barcelona, Departament d'Economia i Història Econòmica, Unitat d'Història Econòmica.
    2. Kozo Mayumi & Mario Giampietro & Jesus Ramos-Martin, 2011. "Reconsideration of Dimensions and Curve Fitting Practice in Economics Elaborating on Georgescu-Roegen’s Economic Methodology," UHE Working papers 2011_05, Universitat Autònoma de Barcelona, Departament d'Economia i Història Econòmica, Unitat d'Història Econòmica.
    3. Mayumi, Kozo & Giampietro, Mario, 2010. "Dimensions and logarithmic function in economics: A short critical analysis," Ecological Economics, Elsevier, vol. 69(8), pages 1604-1609, June.
    4. Baiocchi, Giovanni, 2012. "On dimensions of ecological economics," Ecological Economics, Elsevier, vol. 75(C), pages 1-9.
    5. Hepburn, Cameron & Teytelboym, Alexander & Cohen, Francois, 2018. "Is Natural Capital Really Substitutable?," INET Oxford Working Papers 2018-12, Institute for New Economic Thinking at the Oxford Martin School, University of Oxford.
    6. Ohanian, Lee E. & Prescott, Edward C. & Stokey, Nancy L., 2009. "Introduction to dynamic general equilibrium," Journal of Economic Theory, Elsevier, vol. 144(6), pages 2235-2246, November.
    7. Lundmark, Robert & Söderholm, Patrik & Lundmark, Robert, 2003. "Structural changes in Swedish wastepaper demand: a variable cost function approach," Journal of Forest Economics, Elsevier, vol. 9(1), pages 41-63.
    8. Peter J. Veazie, 2015. "Understanding Statistical Testing," SAGE Open, , vol. 5(1), pages 21582440145, January.
    9. Stern, David I., 1997. "Limits to substitution and irreversibility in production and consumption: A neoclassical interpretation of ecological economics," Ecological Economics, Elsevier, vol. 21(3), pages 197-215, June.
    10. Recalde, Marina & Ramos-Martin, Jesús, 2012. "Going beyond energy intensity to understand the energy metabolism of nations: The case of Argentina," Energy, Elsevier, vol. 37(1), pages 122-132.
    11. Hossein Mirshojaeian Hosseini & Shinji Kaneko, 2013. "Fuel Conservation Effect of Energy Subsidy Reform in Iran," Working Papers 3-1, Faculty of Economics,University of Tehran.Tehran,Iran.
    12. Koetse, Mark J. & de Groot, Henri L.F. & Florax, Raymond J.G.M., 2008. "Capital-energy substitution and shifts in factor demand: A meta-analysis," Energy Economics, Elsevier, vol. 30(5), pages 2236-2251, September.
    13. Stephen T. Ziliak & Deirdre N. McCloskey, 2013. "We Agree That Statistical Significance Proves Essentially Nothing: A Rejoinder to Thomas Mayer," Econ Journal Watch, Econ Journal Watch, vol. 10(1), pages 97-107, January.
    14. Mirshojaeian Hosseini , Hossein & Majed , Vahid & Kaneko , Shinji, 2015. "The Effects of Energy Subsidy Reform on Fuel Demand in Iran," Journal of Money and Economy, Monetary and Banking Research Institute, Central Bank of the Islamic Republic of Iran, vol. 10(2), pages 23-47, January.
    15. Nicolas Vallois & Dorian Jullien, 2017. "Estimating Rationality in Economics: A History of Statistical Methods in Experimental Economics," Working Papers halshs-01651070, HAL.
    16. Henriksson, Eva & Söderholm, Patrik & Wårell, Linda, 2012. "Industrial electricity demand and energy efficiency policy: The role of price changes and private R&D in the Swedish pulp and paper industry," Energy Policy, Elsevier, vol. 47(C), pages 437-446.
    17. Roger Fouquet, 2012. "Economics of Energy and Climate Change: Origins, Developments and Growth," Working Papers 2012-08, BC3.
    18. Markus Eberhardt & Francis Teal, 2011. "Econometrics For Grumblers: A New Look At The Literature On Cross‐Country Growth Empirics," Journal of Economic Surveys, Wiley Blackwell, vol. 25(1), pages 109-155, February.
    19. Freire-González, Jaume, 2011. "Methods to empirically estimate direct and indirect rebound effect of energy-saving technological changes in households," Ecological Modelling, Elsevier, vol. 223(1), pages 32-40.
    20. Nicolas Vallois & Dorian Jullien, 2018. "A history of statistical methods in experimental economics," The European Journal of the History of Economic Thought, Taylor & Francis Journals, vol. 25(6), pages 1455-1492, November.

    More about this item

    Keywords

    dimensions; logarithmic function; Nicholas Georgescu-Roegen; macroeconomics; Cobb-Douglas function; econometrics; curve fitting; transcendental production function;
    All these keywords.

    JEL classification:

    • C13 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Estimation: General
    • C45 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Neural Networks and Related Topics

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:rjr:romjef:v::y:2012:i:4:p:17-35. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Corina Saman (email available below). General contact details of provider: https://edirc.repec.org/data/ipacaro.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.