Would historical hermeneutic economics be 'serious' subject?

Yi Hu --------------------------------------------------

View my research on my SSRN Author page: http://ssrn.com/author=1621246

Introduction

Introduction

• Failure of Stamp Duty (Amendment) Bill 2013 in HK is a concrete case of mainstream economics fallacy. The demand-side management measures did not work in imbalanced market. Price can not reach equilibrium. The current price of HK estate market is almost as much as twice that in 1997.

• Until now we still can not find a mathematical equation to fully describe the attribute of past financial crisis.

Rough definition of historical hermeneutic economics

• The concept of “historical-hermeneutic sciences” was firstly formulated by professor Paul Ricoeur in 1975.He said it could be elicited from the phenomenology of perception.

• Professor Hans-Georg Gaddamer(1975) also pointed out the epistemological problem can be overcome through phenomenological research

• Professor Shionoya(2009) intended to show that hermeneutical thinking could provide the philosophical foundation for a formulation of economics that serves as an alternative to current mainstream economics.

Rough definition of historical hermeneutic economics

• historical hermeneutic economics is explication of phenomena which is constructed on analytical narrative to deal with ill-defined economic problem.

• Professor Maria Cristina Marcuzzo(2008) pointed out based on narrative HET would leap into the broader realm of intellectual history

• Professor Paul Ricoeur (1975) said true narrative can reveal the hsitorical reality.

• In the view of system thinking ,analytical narrative was deemed as “critical systems thinking and practice”.professor Michael C.Jackson(2003)

Cognitive mode of historical hermeneutic economics

• Explanatory mode: discover social laws to deduce social facts

• Interpretative mode: unscramble the special and local social phenomena ,interpret their meaning and find out the whole structure. Professor Huaxia Zhang (2010)

• In contrast to cognitive mode of positive economics:1)defining the problem 2)selecting objectives 3)synthesizing systems 4)analyzing systems 5)selecting the best alternatives 6)planning for action. Professor Dewey J(1910)

Method of analytical narrative

• RATIONAL RECONSTRUCTIONS:the most important of which consists in the reformulation of the arguments of past authors into a modern theoretical framework.

• CONTEXTUAL ANALYSIS: the framework consists of facts regarding time, place and circumstance about which knowledge and information have first to be dug out and then used to make sense of what is being interpreted or as far as possible ,illuminated.

• Professor Maria Cristina Marcuzzo(2008)

Method of analytical narrative

• TEXTUAL EXEGESIS: the technique defines the scope and method of the professional activity of a historian of economic thought ,within the accepted hermeneutic codes

• Professor Maria Cristina Marcuzzo(2008) • TRANSCENDENRAL REDUCTION: it is thus within the

intersubjectivity ,which in the phenomenological reduction has reached empirical givenness on a transcendental level,and is thus itself transcrndental ,that the real world is constitute as “objective”,as being there for everyone

• Professor Edmund Husserl (1913)

A typical case to elucidate historical hermeneutic economics

• Yi Hu（2011）ANALYSIS OF CHINA'S ECONOMY SYSTEM FAILURE

• http://journals.isss.org/index.php/proceedings55th/article/view/1609

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http://d.wanfangdata.com.cn/Periodical_glkxwz200936037.aspx(chinese version)

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A typical case to elucidate historical hermeneutic economics

• "the additional benefit which a person derives from a given increase of his stock of a thing,diminishes with every increase in the stock of it he already has"Marshall,A.(1961).Prnciple of Economics

• The law was used to estimate the result of China's massive stimulus package

• Due to heterogeneity,Public investment must be devided into the living related small-scale and the infrastructure related large-scal .Learning from Japan's lesson,Only the fomer is effective and efficient.

• “we described the conscious act of this fusion as the effective-historical consciousness”

• Hans-Georg Gadamer(1975)

A typical case to elucidate historical hermeneutic economics

• Based on the Analytic Narrative of China’s estate market bubble, Yi Hu discovered a gap between disappearing investing demand due to the motivation of making profit and increasing supply. The gap was triggered by intentional action.it is deemed as the non-equilibrium characteristic of China’s economy.

• “The ego must assume for itself the ‘imaginative variation’ by which it could respond to the ‘imaginative variation’ on reality that literature and poetry ,more than any other form of discourse ,engender”

• Professor Paul Ricoeur (1975)

A typical case to elucidate historical hermeneutic economics

• A new form of QE should be created to deal with the contraction of China’s economy which has been immune to mainstream economic policy. The new form of QE is aimed at Easing Monetary Policy, small-scale living-related Fiscal Policy and revival of estate industry.

The End

• The essay is trying to provide a proof of historical-hermeneutic economics .It throws a light on muti-methodology economics, where different method copes with different situation.