Scholarly Comments on Academic Economics

“Theory” and “Models”: Terminology Through the Looking Glass

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Abstract

Klein and Romero’s (2007, Econ Journal Watch) use of the terms “theory” and “model” seems at considerable variance from other common uses, suggesting that divergent usage by economist-authors may confront readers with substantial ambiguity. Clarity and understanding can be enhanced by sorting out the competing uses of these terms. This paper first sets forth and examines Klein-Romero’s use of “theory” and “model”. Second, it compares their usage with several quite different if not antithetical examples in the literature. Third, it provides a tentative classification scheme of model-types to capture the range of usages of this term in economics. Our thesis is that the terms “theory” and “model” are incapable of carrying the diverse characteristics different economists ascribe to them. Descriptive clarity may require more than just two terms. Our classificatory scheme tries to shed light on this possibility, at least for models.