walkitout (walkitout) wrote,

Word of the Day: Ergodicity

I'm reading _Econned_, reviews of which from numerous sources lead me to at least provisionally trust it. At or around location 945 (10% of the way through the text on the kindle), I encounter this assertion:

"One way to assess mainstream economics is to look at the assumptions and ascertain whether they make sense. One of Samuelson's major assumptions that undergirds much of mainstream economics, and one that Keynes rejected, is ergodicity.

In simple terms, "ergodicity" means that no matter what happens in the world, everything will reach a point where things stop cange, which, in economics, is the prized equilibrium. It also means that a system acts consistently over time."

This is a quite startling assertion, however, googling around indicates that it is actually a valid summary of the idea of ergodicity in economics. I find this utterly amazing, given the source of the idea in physics, where the people who came up with the idea (not in economics!) certainly understood that it is just not safe to make this assumption without a lot of very careful observation, and making sure that observation was detailed enough over a long enough period of time.

Tags: economics, not-a-book-review

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