 Samuelson and Davidson on ergodicity: A reformulationMiguel Carrión Álvarez and Dirk Ehnts Journal of Post Keynesian Economics, 2016, vol. 39, issue 1, 1-16 Abstract: The concept of ergodicity in economics seems to have the qualities of a shibboleth—a word or saying used by adherents of a party, sect, or belief, and usually regarded by others as empty of real meaning. It is in use by both neoclassical economics—after Samuelson (1965, p. 43), who used the term in his paper on what later became a foundation of the efficient market hypothesis—and post Keynesian economics—after Davidson, who picked up the term in order to highlight methodological differences. Considering the origin of the concept in statistical physics and its use in the topology of dynamical systems, which most economists are not conversant with, the importance ascribed to ergodicity in economic debate seems mystifying. We deconstruct the meaning of the term in the major contributions of Samuelson and Davidson. We suggest an alternative to (non)ergodicity to discuss the nature of randomness in the real world. While neoclassical theory assumes stochastic randomness, post Keynesians assume nonstochastic randomness, a term developed by the mathematician Kolmogorov (1986, p. 467). We argue that even in an ergodic world there is a problem with the idea that stochastic randomness can be dealt with by the financial system. Date: 2016 Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:mes:postke:v:39:y:2016:i:1:p:1-16 Ordering information: This journal article can be ordered from DOI: 10.1080/01603477.2016.1145062 Access Statistics for this article More articles in Journal of Post Keynesian Economics from Taylor & Francis Journals |
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