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Often all that we shall be able to predict will be some abstract characteristic of the pattern that will appear— relations between kinds of elements about which individually we know very little. Yet, as I am anxious to repeat, we will still achieve predictions which can be falsified and which therefore are of empirical significance. Of course, compared with the precise predictions we have learnt to expect in the physical sciences, this sort of mere pattern predictions is a second best with which one does not like to have to be content.

The theory which has been guiding monetary and financial policy during the last thirty years, and which I contend is largely the product of such a mistaken conception of the proper scientific procedure, consists in the assertion that there exists a simple positive correlation between total employment and the size of the aggregate demand for goods and services; it leads to the belief that we can permanently assure full employment by maintaining total money expenditure at an appropriate level. Among the various theories advanced to account for extensive unemployment, this is probably the only one in support of which 1 “Scientism and the Study of Society,” Economica, IX, no.

Nor am I prepared to accept the excuse that this branch of research is still very young: Sir William Petty, the founder of econometrics, was after all a somewhat senior colleague of Sir Isaac Newton in the Royal Society! , Luis Molina, De iustitia et iure, Cologne 1596–1600, tom. II, disp. 347, no. 3, and particularly Johannes de Lugo, Disputationum de iustitia et iure tomus secundus (Lyon, 1642), disp. 26, sect. 4, no. 40. FRIEDRICH A. HAYEK 43 There may be few instances in which the superstition that only measurable magnitudes can be important has done positive harm in the economic field: but the present inflation and employment problems are a very serious one.

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