chapter  5
EXPERIMENTS, DYNAMICS AND COGNITIVE ILLUSIONS
Pages 20

Most economic theories seem to come from the introspection and imagination of economists rather than from their observation of the world around them. When axioms or consequences of choice theories are confronted with external empirical information, there appear to be some significant disparities between these aspects of familiar theories and the perceived features of actual choices. Major disparities can be explained in terms of abstraction, integration of supplemental assumptions, systematic flaws in much empirical data, ill-chosen or unrepresentative contexts, insufficient rewards being offered to economic agents, a limited need for mere generic predictions and average tendencies rather than for any specific predictions, or additional factors and considerations. These explanations reflect alternative perspectives on methodology, the awkward interaction of theory and evidence, tainting of evidence and abstraction of theories, and common perceptions of the relative supremacy of theory versus evidence in situations of potential conflict or disparity.