In either case, a theory which is dimensionally inconsistent is suspect. 
However there is the problem that one can derive empirical observations that 
are governed by some functional form and which do tell us something about 
regularities which exist in the economy. One approach to this is to say that if 
the functional form is a polynomial with constants p=  a x^2 + b y+ cz^3  say 
then we can assume that the constants a, b, c have dimensions such as to cancel 
out the dimensions given by the polynomial terms. The constants of nature are 
given explicit dimension in order for them to do this.
I am not quite sure how to handle this if the functional form we have is 
exponential or logarithmic.
________________________________________
From: [email protected] [[email protected]] On 
Behalf Of Tom Walker [[email protected]]
Sent: Monday, August 13, 2012 9:40 PM
To: Progressive Economics
Subject: Re: [Pen-l] math question

As I said, that is one possible interpretation. The other possibility is that 
the "more important" flaws you enumerated (with the notable exception of 
"deliberate ignorance of class relations") are symptoms. I would suggest that 
the unit fallacy is the pseudo-scientific "flip side" of "deliberate ignorance 
of class relations." It has the dual function of diverting attention from class 
relations while at the same time concealing that is its intention. This dual 
function becomes clear if you trace its origins back to its more overtly 
ideological precursors in the 18th and 19th century.

On Mon, Aug 13, 2012 at 12:47 PM, Jim Devine 
<[email protected]<mailto:[email protected]>> wrote:
me:
> "...while never examining the units used to measure its
> ingredients..."

Tom Walker wrote:
> ...  It's not a big deal? That supposes that
> the "real flaw" is elsewhere and therefore the unit fallacy is subsidiary.
> Although that is one possible interpretation, the other possibility is that
> the will to express relations in non-existent units that is at the bottom of
> all the rest of the hocus-pocus, in which case the unit fallacy is
> foundational and not ornamental.

I'd say instead that the willingness to use non-existent units is a
matter of sloppiness resulting from the insulation that many or even
most macroeconomists have from serious criticism. Of course, that
insulation is often created by economists themselves when they use
unnecessary mathematics in the first place.

It's a definite flaw, but it seems less important than various other
macroeconomics sins, including (in no particular order of importance):

- the very common failure to see the distinction between macro and
micro (preferring to reduce the former to the latter, even while
teaching students about the fallacy of composition);

- the use of a timeless model (with no true uncertainty) having no
role for money (beyond being a means of exchange), so that Say's "law"
applies;

- the use of an aggregate neoclassical production function;

- ignorance of how the existence and persistence of unemployment feeds
back to transform micro-level results;

- obsession with equilibrium as somehow describing a real-world state;

- the assumption that the difference between idealized models and the
messy real world is unimportant;

- deliberate ignorance of class relations;

etc.

--
Jim Devine / If you're going to support the lesser of two evils, you
should at least know the nature of that evil.
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--
Cheers,

Tom Walker (Sandwichman)

The University of Glasgow, charity number SC004401
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