Any sorting of issues with heterodox economists requires a certain patience, which we presume is owed in that ‘heterodoxy’ exhibits little unity beyond its decision not to be orthodox. It is difficult to argue with a ‘viewpoint’ that is scattering in all directions from its rejected neoclassical core.

Arnsperger and Varoufakis have done much to unify the discussion by identifying equilibrium as the great insufferable in analyzing indisputably dynamic systems such as economies. The spectrum of heterodox critique can be almost entirely derived from this irreconcilable conflict between analytic method and subject matter, e.g.:

Assumptions of the uniqueness and stability of general equilibrium in a Walrasian framework have no theoretical justification.¹

the neoclassical model provides not a completely static market but a trivial dynamic system as opposed to chaotic or complex one.²

the condition for the mathematical existence of a neoclassical equilibrium is that all agents have the same perfect information all the way into the infinite future, and conform to the same view of the future.³

There is no excess demand or supply, no shortage of labor, goods or services, and no unemployment.⁴

a utility function and stable equilibria do not exist. There are only a path-dependent functional U and unstable equilibria.⁵

no actual theory of the out-of-equilibrium functioning of the system could be offered as this was simply impossible in an Arrow and Debreu world.⁶

By this we mean that neoclassicism cannot demonstrate that equilibrium would emerge as a natural consequence of agents’ instrumentally rational choices.⁷

It is well known that the use of the equilibrium concept is characteristic of the neoclassical school — indeed, orthodox mainstream economics has been criticised from all points on the heterodox compass for its reliance on equilibrium thinking.⁸

The system has been ‘dynamicized’ — time has been impounded. But the time involved is fake time, fictitious time: it is a logical time, not a historical time. What comes first is equilibrium, and process is secondary. We move between one equilibrium position of the economy and another. But there is no rhyme or reason to the transition, and no arrow of time. ⁹

some notion of equilibrium, of at least a temporary balance of forces, seems a sine qua non of rational enquiry.¹⁰

To our way of thinking, the issue between economics’ mainstream and its heterodox dissent is principally one of whether the understanding of economics is to be limited by what is possible to human reason, or whether reason is to be aided by analog representations of economic adjustment that are constructed in the objective, temporal realm. Orthodoxy finds these representations impossible; heterodoxy, where it is analytic, finds them indispensable.

SFEcon hopes to join these issues by portraying economic adjustment as a process that 1) moves efficiently from any chaotic state to a general equilibrium held in place by Pareto’s optimum, but 2) has no references to a steady state. Thus we presume to have added potency to the heterodox critique by structuring our theory so as to avoid it. In the construction established with Post Keynesian economist Steve Keen, SFEcon operationalises the neoclassical school. For us, equilibrium is only a criterion of validity for a dynamic system operating under highly contrived and unlikely boundary conditions — which test we occasionally see sanctioned in heterodoxy:

one would like that the equilibrium should be a resting point of an economically plausible price adjustment process.¹¹

Thus we presume to have 1) removed the greatest theoretical objection to neoclassicism in order that 2) a dynamic price adjustment process (viz.: theory of economics) might be demonstrated that 3) guides the economic system into the peculiar behavior mode that neoclassicism has mistaken for the whole of economic science.

From here, orthodoxy's discussions with heterodoxy might usefully examine the market’s sufficiency as guarantor of mankind’s material well-being. Having what amounts to a ‘videogame’ of pure market capitalism in operation, debate might take forms in which agreement is possible, e.g.: identifying points at which the game’s structure might be changed to reflect those actualities that prevent arrival of an optimal state; or identifying stimuli that force the structure’s collapse; etc. This would parallel scientific discussions such as those ensuing from assertions that momentum is conserved, which then demand exposition of that which causes momentum to change.

As we see it, these discussions await resolution of three worthwhile issues:

1. While we agree with and commend heterodoxy’s critiques of neoclassical microeconomics, we do not affiliate with the great portion of heterodoxy that now concerns itself with micro phenomena. SFEcon is a purely macro model imagined independently from any concept of ‘the firm’ or ‘the market’ or ‘the household’. Our issues with heterodoxy on this matter are the same as those raised against orthodoxy in our earlier discussion on whether or not the micro and the macro can or should be conceived separately.

2. Our direct conflict with heterodoxy is with its macroeconomics, which is to say with Keynesianism’s several incarnations. Obviously we prefer an alternate approach to understanding capitalism; and we are not deterred by the several direct and incidental findings by which the Keynesians would disallow SFEcon.

3. SFEcon finds economics’ dynamics adequately portrayed by the singular method used to describe every precisely understood temporal phenomenon. We have yet to cognize what it is about our subject that requires more than the ordinary engineering dynamics spanning such diverse phenomena as fluid mechanics, electrical circuitry, and open channel flow.