"If the conditions of the real world approximate sufficiently well the assumptions of the ideal type, the derivations from these assumptions will be approximately correct."Many thanks go to Cosma Shalizi for posting this critique by by Herb Simon and Paul Samuelson of Milton Friedman's infamous essay "Methodology of Positive Economics"
The quote above is from Simon's section. Also be sure to read Samuelson's section where he posits
"that the non-positivistic Friedman has a strong effective demand which a valid F-Twist brand of positivism could supply"Just brilliant...
After reading things like this it is very, very unclear to me why I should care at all about the economic and policy implications of a macro model where agents have rational expectations...
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