User talk:Volunteer Marek/Archives/2006/November

Steve Keen
Hi there,

Just wanted to check, how to agree on a neutral version of the artcile on Steve Keen. I think the article is OK, the way it is now, except for the second paragraph. My suggesttions:

1. This part: "A "proof" can be found here: http://www.debunking-economics.com/Size/mc_eq_p.htm" has a wrong link. The correct link is: http://www.debunking-economics.com/Maths/size.htm.

2. That previous link is in fact a proof (also published in the leading physics journal Physica A). So we should write "A proof can be found ..." and drop the quotation marks around the word proof.

3. Therefore we should also rephrase the following and state, that "Economists still believe that if one firm reduces it's quantity total supply will fall". (This is wrong, as is proven above, but I would agree to give this argument.).

4. It is actually the work from Eiteman & Guthrie, not Alan Blinder, which established the 89%-result for real firms, so we should replace Alan Blinder with the fully referenced article of Eiteman & Guthrie (1952).

Can we agree on this?

Regards, Aleksandar I. Ivanov 27 October 2006 (UTC)

Aleksander, I will reply here because I don't know where your talk page is. Ok, with regards to changing the relevant links, it is of course an improvement (in regards to 1. and 2.) In particular referencing Eiteman & Guthrie rather than Blinder - though if I remember correctly Blinder also did empirical work on the subject matter though I don't know if he is the one actually cited by Keen. However, as far as this "proof" goes... well, it is a "proof" but it is a wrong proof. A good analogy would be with someone who claims to have provided a "simple proof of Fermat's last theorem" - it looks deceptively correct but it's not. The mistake in the Keen paper is that "price-taking" means "price-taking" hence the second derivative in that equation is zero so it still reduces price equal marginal cost. If you read the Keen paper and look up the reference to Stigler you'll see that what Stigler is actually talking about is a Cournot market not a perfectly competitive market but somehow Keen completly ignores this. The "proof" is just wrong there's no two ways about it. I don't know much about Physica A, it seems to be a Physics and Math journal, which means that while probably quite competent in those fields its editors are probably unfamiliar with economics and so Keen could succesfuly get this sleight-of-hand past them. No serious economic journal (and this is simple math which economists know as well as any Physicist) accepted the paper and American Economic Review rejected it with a barely-contained embarrasment (that someone would actually think of submitting this nonsense) - the referee review used to be on Keen's site but he took it down. So I think "Keen claims to have proven" is much more NPOV than "Keen has proved" (the accurate version would actually be "Keen has mistakenly claimed to have proven"). So #3 is not wrong. Think of integrating a function over an interval. If you increase the value of that function at just one point (ie. just one firm raises its output) the value of the integral (total market output) doesn't change. This is one characterization of a perfectly competitive market. Even if there isn't a continuum of firms, what matters is not that output changes with respect to choices of any one firm but rather that each firm ACTS (ie. the way it carries out its maximization problem, by definition) as if it didn't - because it is so small relative to the whole market.radek 01:54, 29 October 2006 (UTC)

Dear Radek,

thank you for your comments. I also got a | Talk page, so you can reply there now. My user name ist AlexIvanov2.

I believe that we can soon settle the last point of disagreement - the proof on price-taking in the theory of competition. You asserted that, "price-taking means price-taking" so the second derivative should be zero (see your last comment on your talk page). The next assumption in the theory is that: change of output by one firm, does not affect price. Because this is so, the individual demand curve of a firm, p(Q), must be a horizontal line at the market price (price-taking). On the other hand, the market demand curve P(Q) is supposed to be downward sloping. P(Q) is the sum of all the individual p(Q)'s. But since they are all horizontal lines at market price (according to the assumptions), it is impossible for their sum to have a different slope. So the total demand curve (market demand) must be just as flat (slope = 0). But then in the neoclassical proof a downward sloping market demand is still used.

Why does this situation arise? The reason for this is, that the neoclassical theory of perfect competion has inconsisten assumptions, i. e. assumptions which are logically incompatible. That's what the Keen paper in Physica A is arguing. However, the prrof in Physica A is very high level and short, because of the usual restrictions on journal articles. So if you like, you can check out the full argument including proofs here: A few | slides on the topic from a recent presentation of Prof. Keen at City University of New York.

Just as an acompanying reading note: The key inconsistent assumtions are that a change in one very small firm's output means zeor change at the global level. This is impossible by the fundamental axioms of mathematics, specifically the Axioms of Peano on Counting.

I know it will be hard to digest, but it is a matter of fact, that neoclassical theory has a lot of fallacies, and the one we're talking about is just one of them.

Please let me know, what you think.

Best regards, Alex

PS: About the Physica A journal: This is the world-leading journal for Statistical Mechanics and it's applications. During the last decade it has evolved into one of the key journals for Econophysicists. So the people their know Economics just as well as Maths. On average they have at least four Social Science articles per issue, usually on fairly advanced topics, but also on general issues, like this | one.

Alex, the link to your talk page doesn't seem to work. BTW I perfectly understand what Keen is saying so there's no need to repeatedly explain it to me. He's still wrong though. radek 02:42, 2 November 2006 (UTC)

Radek, try again, this link to my talk page should work now. Curious about your comments. Al, 3 November 2006 (UTC) PS: The last change in the article is not mine (although I totally support it).

Radek, I can see, that our discussion get's to complex to handle ... it's hard to determine whether I claim, that Prof. Keen claims, that neoclassical theory claims ... which according to you it does not claim ... We'd have to start collecting the claims of Neoclassics from all books and papers etc. to see what they actually do claim - probably many different things - before we could move. That's not feasible. So, I tried to compile a neutral version of the Keen article, which explains Prof. Keen's beliefs and his work. It does not claim anymore that there is s definitive proof that neoclassical theory is invalid, but in does explain that Keen has published (in the words of the current article text: "presented") a proof on this topic. Hope we can settle it that way. AlexIvanov2 10:36, 6 November 2006 (UTC)

Radek, I'm glad we could settle this. Best, Alex. AlexIvanov2 11:18, 7 November 2006 (UTC)

Andrzej Wroblewski
A tag has been placed on Andrzej Wroblewski, requesting that it be speedily deleted from Wikipedia. This has been done because the article seems to be about a person, group of people, band, club, company, or web content, but it does not indicate how or why the subject is notable (see the guidelines for notability here). If you can indicate why the subject of this article is notable, you may contest the tagging. To do this, please write  on the top of the page and leave a note on the article's talk page explaining your position. Please do not remove the speedy deletion tag yourself.

Please read the criteria for speedy deletion (specifically, articles #7) and our general biography criteria. Feel free to leave a note on my talk page if you have any questions about this. Diez2 19:05, 9 November 2006 (UTC)

This article should definately not be deleted. In fact I am amazed that this article has not been created yet. He is a major Polish painter but the inital start is very poorly written so it makes it look not notable. Please use *http://www.culture.pl/en/culture/artykuly/os_wroblewski_andrzej to expand and write this article properly with the correct layout and birth dates etc and layout. Ernst Stavro Blofeld 19:38, 9 November 2006 (UTC)

There we go don't say I never do anything for you. I have set out a basic srticle for Andrzej Wroblewski. It needs a great deal of expansion particularly from the period 1948 -1957 his death. You can use the source I gave you to add all this. Ernst Stavro Blofeld 20:12, 9 November 2006 (UTC)