SFEcon Model 0 presumes to operate on the minimal set of state variables by which a macroeconomic system might be described, viz.: levels of physical assets and monies held by the economic sectors. It then follows that a dynamic theory of economics would compute the instantaneous rates at which physical and monetary levels are changing; and these computations must be based on the levels of the state variables at any given moment. If economics’ dynamics are to conform with those of all precisely-understood dynamic systems, then the instantaneous rates of change derived from a given state will be numerically integrated with that state in order to create the system’s next state at a slightly advanced point in time.

Our notions about dynamics would require that one and the same model must seamlessly represent the economy’s instantaneous states, the succession of these states ensuing from disequilibrating stimuli, and the final state at which all such stimuli have been absorbed. A dynamic theory of anything is confined to what happens at a given moment: the reality of time contains no long run; no short run; only a ‘now’. All a dynamic machine ‘knows’ at any point in time is its current state and its rules for getting to its next state, one differential element of time hence.

A time-continuum of economic states is thus built-up by a program that recursively executes the two steps characteristic of all numerical methods: 1) instantaneous rates of change are computed from the model’s current state; and 2) the model’s next state is computed by integrating these rates of change into the current state. The ‘next state’ arrived-at in Step 2 then overlays the ‘current state’ in Step 1, where it provides the basis for re-computing rates of change for the next time differential. Step 1 is where all of a system’s causality must be expressed; Step 2 is a requirement of the numerical emulation process, and is the same irrespective of the subject matter modeled in Step 1.

SFEcon’s Step 1 departs from neoclassicism in that no references whatever are made to equilibrium. Our causality operates irrespective of whether the system’s state is steady or unbalanced, optimal or suboptimal. We engage neoclassicism insofar as our causality is always directing the system toward an optimal state – as such might be discerned given the current state’s typically imperfect, incomplete, contradictory, and varied indicia of where the optimal state might lie.

Whether or not our causality provides a stable, efficient path to a steady state upheld by optimality cannot be argued from the causality of our Step 1. The system is complex to a point where its behaviors can only be revealed by joining our Step 1 with the generic Step 2 in order to create a sort of ‘instructional videogame’. Only the operation of such analogs allows one to conclude that SFEcon Model 0 will subside into a stable steady state if the shape of its production and utility tradeoffs remains fixed; or will discover a new optimum if these technical parameters are exogenously changed; or will ultimately re-discover its initial optimum in response to exogenous changes to its state variables.

While SFEcon must commend the heterodox drive to convey understanding via the emulation technology used by all other technical disciplines, we remain generally un-persuaded that this project requires us to jettison the premise of marginal revenues approaching marginal costs. Our experience working-out the means by which economic systems might achieve stable adjustments to their possible stimuli suggests that these processes must be governed by some central organizing principle. If such a principle is indeed necessary, it must surely comprehend the variables of monetary and physical flows, and the shapes of production tradeoffs by which the general optimum is described.

The optimum certainly has the character of a self-evident generality from which a scientific discipline is likely to proceed. It operates in a dynamic context by way of the comparatively unobtrusive requirement that the economy must remain in flux until all potential for extraordinary profit is exhausted. And it gives a central role to a causality governed by the struggle for capital among economic sectors.

Having been unable to falsify the neoclassical premise either empirically or in terms of its ability to express the generic dynamics of economic adjustment, we will provisionally retain the general optimum as our central organizing principle until heterodoxy presents us with SFEcon-like demonstrations based on some other premise.