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Margaret Schabas, Philosophy Department, University of British Columbia
This paper will demarcate thought experiments from models in economics, and argue that thought experiments and models are distinct types of conceptual tools. There are, however, some models that are near cousins to thought experiments, and vice versa. I will argue that thought experiments are in fact quite rare in economics, past or present. They are launched by a strong if not jarring counterfactual to a distant rather than proximate other world, and the journey the mind then takes back to this world is a familiar one. The paradigmatic case is Hume’s sudden doubling of the money supply, or Friedman’s helicopter drop. But the current rash of thought experiments in environmental economics, as posited by for example Martin Weitzman or Nathaniel Keohane, is misguided. We would be the better for finding a different name for models that speculate well into the future.
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