Reconsideration of Dimensions and Curve Fitting Practice in Economics Elaborating on Georgescu-Roegen’s Economic Methodology

Abstract

This paper is to examine the proper use of dimensions and curve fitting practices elaborating on Georgescu-Roegen’s economic methodology in relation to the three main concerns of his epistemological orientation. Section 2 introduces two critical issues in relation to dimensions and curve fitting practices in economics in view of Georgescu-Roegen’s economic methodology. Section 3 deals with the logarithmic function (ln z) and shows that z must be a dimensionless pure number, otherwise it is nonsensical. Several unfortunate examples of this analytical error are presented including macroeconomic data analysis conducted by a representative figure in this field. Section 4 deals with the standard Cobb-Douglas function. It is shown that the operational meaning cannot be obtained for capital or labor within the Cobb-Douglas function. Section 4 also deals with economists’ ?curve fitting fetishism?. Section 5 concludes this paper with several epistemological issues in relation to dimensions and curve fitting practices in economics.dimensions, logarithmic function, Nicholas Georgescu-Roegen, macroeconomics, Cobb-Douglas function, econometrics, curve fitting, transcendental production function