Uncertainty, Probability and Animal Spirit

Incertitude, probabilités et esprits animaux

Michaël Lainé ()
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Michaël Lainé: OCRE - Observatoire et Centre de Recherche en Entrepreneuriat - EDC - EDC Paris Business School

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Abstract: According to O'Donnell, "For Keynes, philosophy is the queen of the sciences." As a matter of fact, his microeconomic theory of investment pertains to a rich philosophical background, developed since his PhD thesis. The purpose of this paper is threefold: to assess the limits of probabilistic reasoning according to Keynes; to stave off misconceptions and divergences in the analysis of his thought; to show that Keynes draws a non-probabilistic theory of decision where individuals expect in an analogical fashion by relying on conventions and emotions. Consequently, he lays the foundations of an alternative approach to standard theory. In order to achieve its purpose, the paper explores the following points: 1) uncertainty is, for Keynes, above all an ontological question; 2) probabilistic reasoning is epistemological (it is a form of knowledge) and not ontological (it is not a subject of knowledge); 3) Keynes develops a theory of analogical intuition, default-mode of our thoughts, supposed to solve the famous "problem of induction"; 4) Keynes's non-Platonism (despite a long-lived legend); 5) the continuity of his thoughts; 6) the weight of arguments and the role of confidence; 7) the genealogy of the concept of animal spirits; 8) the duality of reasoning, and the original contribution of Keynes' theory to contemporary debates in economic psychology.

Keywords: Keynes (John M.); probability; animal spirits; radical uncertainty; induction; probabilités; esprits animaux; incertitude radicale (search for similar items in EconPapers)
Date: 2016
Note: View the original document on HAL open archive server: https://hal.science/hal-02942874
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Published in Œconomia - History/Methodology/Philosophy, 2016, 6-3, pp.403-439. ⟨10.4000/oeconomia.2412⟩

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-02942874

DOI: 10.4000/oeconomia.2412

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