EconPapers    
Economics at your fingertips  
 

Treating Macro Theory as Systems Theory: How Might it Matter?

Vipin P. Veetil and Richard E. Wagner

A chapter in New Thinking in Austrian Political Economy, 2015, vol. 19, pp 119-143 from Emerald Publishing Ltd

Abstract: Abstract Standard macro theories have the same analytical structure as their micro counterparts. Where micro theories work with equilibrium between supply and demand for particular products, macro theories work with equilibrium applied to aggregates of products. This common approach treats the micro–macro relationship as scalable, with macro variables being aggregations over micro variables. In contrast, we pursue a systems-theoretic approach to the micro–macro relationship. This relationship is not scalable and rather entails a disjunction between micro- and macro-levels of theory. While micro phenomena are still susceptible to choice-theoretic analysis, macro phenomena are products of ecological interaction and so entail emergent phenomena. Our alternative approach treats macro theory as a form of systems theory where the behavior of the system has properties that are not reducible to properties of the individual elements within that system. Besides sketching this alternative approach, we examine some of the different insights this approach offers into such topics as unemployment and stabilization.

Keywords: Systems theory; complexity theory; emergence; non-equilibrium theory; microfoundations; countercyclical volatility; B25; B5; D23; D50; E10; E22; E32 (search for similar items in EconPapers)
Date: 2015
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1) Track citations by RSS feed

Downloads: (external link)
http://www.emeraldinsight.com/10.1108/S1529-213420 ... RePEc&WT.mc_id=RePEc (text/html)
Access to full text is restricted to subscribers

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eme:aaeczz:s1529-213420150000019007

Ordering information: This item can be ordered from
Emerald Group Publishing, Howard House, Wagon Lane, Bingley, BD16 1WA, UK
http://www.emeraldgr ... ies.htm?id=1529-2134

Access Statistics for this chapter

More chapters in Advances in Austrian Economics from Emerald Publishing Ltd
Bibliographic data for series maintained by Charlotte Maiorana ().

 
Page updated 2020-07-01
Handle: RePEc:eme:aaeczz:s1529-213420150000019007