Functions are

not seen, but must beunderstood. (Catherine Blanche King, private communication)A systematic explanation, then, requires a normative theoretical framework. The basic terms and relations of such a framework would specify the distinctions and correlations that articulate the causes, which are

not necessarily visible, of events that are apparent to all. (CWL 15, Editors’ Introduction, lv) (Continue reading)

# Category Archives: Field Theory

# The Animal Organism and the Economic Organism

**CONTENTS: **

- THE STUDY OF ORGANISMS – ANIMAL AND ECONOMIC
**DETERMINISM AND INDETERMINISM – DISAGREEING WITH EINSTEIN****CORRESPONDENCE**IN THE CURRENT BASIC DYNAMIC, ORGANIC PROCESS; A**DETERMINATE**ALGEBRAIC FUNCTION OF THE FIRST DEGREE- CORRESPONDENCE IN THE SURPLUS DYNAMIC, ORGANIC PROCESS; AN
**INDETERMINATE**POINT-TO-LINE CORRESPONDENCE - AVOIDING A
**VICIOUS CIRCLE OF CRITICISM** - THREE IMPLICITLY-DEFINED CIRCULATORY ORGANS
- THE TRANSITION TO
**SYSTEMATIZATION** - THE
**ROLE OF MIND**IN THE DEVELOPMENT OF THE HUMAN AND THE ECONOMIC ORGANISMS

** .1. ****THE STUDY OF ORGANISMS – ANIMAL AND ECONOMIC: **** (Continue reading)**

# Explaining “Present Fact”: An Ever-Varying Process; A Never-Varying Systematics

The economic process is **always the current**, **purely-dynamic**, concrete functioning. The analysis of the dynamic process is always relevant to the **present fact**. The **immanent intelligibility** of such a dynamic, **ever-varying process** may** itself be an invariant; **i.e. though the differentials may change in magnitude, the relation of the **differential velocities and accelerations** among themselves is **invariant**. So it is in the case of dynamic pendular motion, elliptic motion, the variables of electromagnetic phenomena, and in the dynamic economic process. The **general laws** of the process are **applicable in any instance**. These **primary, abstract, general, field-theoretic laws** may be applied to whatever may be the **secondary determinations** from **the concrete non-systematic manifold. **Thus we can get the **particular law** explaining the **particular** **concrete process** under investigation.

The overall **economic** **functioning** has an **objective immanent intelligibility**. This intelligibility is an **invariant** – a set of **differential equations** which **implicitly define** the explanatory, conjugate, differentials of the dynamic process. The **explanatory terms are abstract functions** defined by their **functional relations to one another**. In the implicit equations, the **terms define the relations and the relations define the terms**, and **insight** fixes both. And the equations **cohere** with one another to constitute a **fully-explanatory field theory.**

The

point-to-lineand highercorrespondencesare based upon theindeterminacyof the relation between certain (surplus) products and the (later ultimate basic) products that (exit the process and eventually) enter into the standard of living. …the indeterminacy is very much a present fact. One has to await the future to have exact information. And while estimates in the present may be esteemed accurate, the future has no intention of being ruled by them: owners do not junk equipment simply because it has outlasted the most reliable estimates; nor are bankrupts kept in business because their expectations, though mistaken, are proved to have been perfectly reasonable. The analysis that insists on the indeterminacy is the analysis that insists on thepresent fact:estimates and expectations are proofsof thepresent indeterminacyand attempts to get round it; and, to come to the main point, an analysis based on such estimates and expectations can never arrive at acriticismof them; it wouldmove in a vicious circle. It is to avoid that circle that we havedivided the processin terms of indeterminate point-to-line and point-to-surface and higher correspondences. [CWL 15, 27-28]in the long run, and especially in the very long run, such a correlation exists. It is that surplus production is

the acceleratorof basic production. In other words thecorrespondencebetween the two is not a point-to-point but a point-to-line correspondence; … Now such acorrespondence, if it is to be expressednot in terms of expectations of the future but in terms of present fact, is a correspondence ofaccelerator to accelerated. … If the system is to move into a long-term expansion, this movement has to begin with a surplus quantity acceleration: surplus production has not merely to maintain or renew existing capital equipment but has to reach a level at which it turns out new units of production and maintains or renews a greater number of existing units; this givesthe quantity surplus expansion. [CWL 21, 132](there is to be discerned a

threefold processin which a basic stage is maintained andacceleratedby a series of surplus stages, while the needed additions to or subtractions from the stock of money in these processes is derived from the redistributive area) … The maintaining of astandard of livingis attributed to abasic process(distinct process 1), an ongoing sequence of instances of. Theso much every so oftenmaintenanceandacceleration(distinct process 2) of this basic process is brought about by a sequence of surplus stages, in whicheach lower stageis maintained andacceleratedby thenext higher. Finally, transactions that do no more than transfer titles to ownership are concentrated in aredistributivefunction, whence may be derivedchangesin the stock of money (distinct process 3) dictated by theacceleration (positive or negative)in the basic and surplus stages of the process. … So there is to be discerned athreefold processin which a basic stage is maintained and accelerated by a series of surplus stages, while the needed additions to or subtractions from the stock of money in these processes is derived from the redistributive area. … it will be possible to distinguish stable and unstable combinations and sequences ofratesin the three main areas and so gain some insight into the long-standing recurrence of crises in the modern expanding economy. [CWL 15, 53-54]

# Only Lonergan

Lonergan is alone … Only Lonergan … Continue reading

# Lilley and Rogoff Recommending Negative Interest Rates

We are commenting with respect to Andrew Lilley and Kenneth Rogoff’s “**conference draft” **discussing the advisability of a FRB policy of negative interest rates:

** **Lilley, Andrew and Kenneth Rogoff, April 24, 2019: **“The Case for Implementing Effective Negative Interest Rate Policy”** (*Conference draft for presentation at Strategies For Monetary Policy: A Policy Conference*, the Hoover Institution, Stanford University, May 4, 2019, 9:15 am PST) **[Lilley and Rogoff, 2019] **(Continue reading)

# A Comparative Note on Einstein’s Special-Relativity Field Theory and Lonergan’s Macroeconomic Field Theory

Special Relativity and Functional Macroeconomic Dynamics are **field theories. (Click here and here and here) **We wish to gain further appreciation of **FMD as a field theory** by juxtaposing it with Special Relativity.

…

Special Relativityis primarily afield theory, that is, it is concerned not withefficient, instrumental,material, orfinalcauses of events, but with the intelligibilityimmanent in data; but Newtonian dynamics seems primarilya theory of efficient causes, offorces, theiraction, and the reactionevoked by action. … Special Relativity is stated as amethodological doctrinethat regards the mathematical expression of physical principles and laws, but Newtonian dynamics is stated as a doctrine about theobjects subject to laws. [3, 43/67] (Continue reading)

# A Contrast: Understanding Pricing in Macrostatic DSGE and in Macrodynamic FMD

**.I. Introduction: Contrasting Diagrams and What They Represent**

We contrast an **assumption and description** with an **explanation and interpretation**. We contrast the Dynamic Stochastic General Equilibrium (DSGE) **assumption** **and description** of pricing as **exogenously** given and acceptable as a **lead item** in analysis of economic problems with Functional Macroeconomic Dynamics’ (FMD’s) **explanation** and **interpretation** of pricing **in the light of** the significant functional pretio-quantital flows, which **explain** the dynamic economic process. (Continue reading)

# Explanatory Macroeconomic Dynamics; Relevant In Any Instance

There are five figures below from CWL 15: The single figure on the left represents the interrelations of **interdependent** **Monetary Flows; **and the figure contains the important** condition of dynamic equilibrium: G = c”O” -i’O’ = 0**. The four figures stacked on the right demonstrate aspects of the

**productive phases**constituting a

**Pure Cycle of Expansion.**The bidirectional arrows uniting the two sides signify that the

**dynamic equilibrium**among

**interdependent flows**specified on the left is to be achieved

**consistently**

**throughout the long-run expansion**represented on the right. This

**condition of dynamic equilibrium**is that the crossover flows between the two interacting circuits must

**continuously**

**balance**

**even as they continuously vary in magnitude**in the succession of phases constituting the expansionary process. Just as the

**general laws**of simple parabolic or pendular motion are

**explanatory and applicable to any particular instance**of initial angle and velocity, so a) the

**primary relativities**of productive and monetary flows, and b) the

**primary differentials**of long-term expansion

**explain**the economic process, and are normatively

**relevant in every particular instance**. All five diagrams are

**unitary**. Each and every velocitous and accelerative flow of products and money has proximate or remote explanatory aspects embedded in all five diagrams. (Continue reading)

# Zephyrs and Pandemics

Functional Macroeconomic Dynamics acknowledges and affirms a **non-systematic manifold of secondary determinations (such as prices and quantities)**, a Canon of Statistical Residues, and the impossibility of prediction in the general case. However, FMD affirms the existence of both human intelligence and the **abstract, primary,** **immanent intelligibility** of the objective, **dynamic** economic process. It is this **abstract, primary, immanent intelligibility** by which the process must always be understood so as to be properly managed.

Knocking a pendulum slightly out of its existing oscillation does not necessitate a search for a new theory of the pendulum in order to correct the mishap. The abstract theory of the pendulum in Newtonian mechanics still applies; the abstract intelligibility of the pendular motion is always relevant, **in any instance,** in **any configuration of initial angle and initial velocity**. The theory still applies, though the motion may be on a new basis determined by new initial conditions or boundary values. Continue reading

# Field Theory in Physics and Macroeconomics

We hope to inspire serious graduate students of economics **a)** to seek and achieve an understanding of “**Macroeconomic Field Theory**,” **b)** to** verify** **empirically** Lonergan’s field relations, and **c)** to use the explanatory field relations as **the basis of influential scholarly papers.**

We trace developments

- in physics from Newtonian mechanics to modern field theory, and
- in economics from Walrasian supply-demand economics to purely relational, Modern Macroeconomic Field Theory.

Key ideas include a) **abstraction and implicit definition** as the basis and ground of **invariance** in both physics and macroeconomics, b) the concept of a **purely relational field**, c) **immanent intelligibility and formal causality**, and d) the canons of **parsimony** and of **complete explanation**. We highlight some key ideas: (continue reading)