Like Gödel incompleteness: you can't validate a formal system using itself. Economics cannot generate its own justification.

These differences may be called meta-economic, inasmuch as they have to be recognised before economic analysis begins. Even more important is the recognition of the existence of “goods” which never appear on the market, because they cannot be, or have not been, privately appropriated, but are nonetheless an essential precondition of all human activity, such as air, water, the soil, and in fact the whole framework of living nature.

Until fairly recently the economists have felt entitled, with tolerably good reason, to treat the entire framework within which economic activity takes place as given, that is to say, as permanent and indestructible. It was no part of their job and, indeed, of their professional competence, to study the effects of economic activity upon the framework. Since there is now increasing evidence of environmental deterioration, particularly in living nature, the entire outlook and methodology of economics is being called into question. The study of economics is too narrow and too fragmentary to lead to valid insights, unless complemented and completed by a study of meta-economics.

small-is-beautifulp. 35–6


small-is-beautiful Schumacher, Ernst Friedrich. 2001. Small Is Beautiful: A Study of Economics as If People Mattered. Random House. ↩︎ 1