Measuring the Effective Model

Like physics, economics works with effective models. These models have political consequences that describe a measurable utility.

When, for example, the Fed raises the interest rate to fight inflation, unemployment rises. This is the Phillips Curve, which is supposed to model the “real” relationship between inflation and unemployment. (“Real” is the relationship that can actually be measured. The relationship is expressed as the law–the natural symmetry–of supply and demand. Inflation naturally causes supply to rise and the demand for jobs to fall.) As inflation rises, the Fed reacts with higher interest rates, causing unemployment. Effectively, it can be said the reaction (using the model) causes unemployment.

If using the model causes something, then changing it can cause something else, which means that the data generated to measure objective reality depends on the utility of the model.

The utility of the effective model disambiguates the objective reality argument of conservative philosophy. Paradoxically, the available ambiguity is diminished by the ambiguity inherent to effective modeling. The ambiguity of an arbitrary, natural existence in which anything goes, resisting nothing, is still available, but it can be used to question objective reality by describing the utility (the effectiveness) of the model, which is an on-demand attribution.

This means that we are not really locked-in to objective reality like conservatives say we are.

Actualizing a new identity is an emergent property that measures an apparent utility (reducing the angst associated with the probable risk of losing your job, for example, because nature–using the effective model–demands it), and capitalists (operating with the notion that capitalism is the ultimate model of efficiency) don’t like that at all!


About griffithlighton

musician-composer, artist, writer, philosopher and political economist (M.A.)
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