Shackle: Time and Uncertainty in Economics

Introduction

The aim of the present paper is to use George Shackle’s Bounded Uncertainty in order to explain the role of the economic scientist in the economic phenomenon. First, I will show why deterministic approaches are not sustainable in a context where novelty and surprise are fundamental according to Shackle. This would be the case of Economics. Then, I will state that an evolutionary approach is a useful language to build a criterion that allows the economic scientist to explain the present consideration of economic entities as stereotypes. By being coherent with innovation and surprise, this language is also useful in an individual and social context to create the future and to be innovative itself. I will suggest how the consequences from Shackle’s solutions to the problem of uncertainty (his notion of potential surprise) can be related to the conceptualization of money. It is not possible to theorize about objective knowledge in economics because there is no such objectivity, but it is feasible to theorize about subjective belief. The role of theory as a belief itself is consistent with this perspective. Its “use” instead of its “veracity” prevails as a criterion of choice amongst theories. It is possible to theorize about subjective bounded uncertainty and the demand for money. I will sketch a viable use of Shackle’s language of potential surprise and the Keynesian concept of Animal Spirits in order to formulate a monetary-fiscal policy based on the role played by emotions in the presence of uncertainty. It will also be proposed an alternative criterion to optimization as the tool for setting scalar variables under uncertainty. The main conclusion of the present article is that Shackle’s notion of uncertainty and his establishment of a new language based on it, are a useful tool for the society in the formulation of fiscal and monetary policies coherent with the permanent social creative process.