A CRITIQUE OF DOPFER AND POTTS'S EVOLUTIONARY REALISM

Influenced by both the Classical Economics of Malthus and Marx and the Austrian economics of Joseph Schumpeter, Evolutionary Economics has developed into a significant school of economic thought that offers a conception of growth and innovation markedly different to that afforded by neoclassical economics. This paradigm has informed analysis in economic geography and regional economics, and contributed to the development and evaluation of science and technology policy. In Australia, the recent Venturous Australia policy document prepared by Terry Cutler and Associates for the Commonwealth Government, owes much to the Evolutionary Economic way of thinking about innovation. In a recent methodology paper Dopfer and Potts (2004) establish three axioms of "evolutionary realism" with the intention of illuminating the ontological commitments of Evolutionary Economics. This paper subjects these axioms, and the manner in which they are applied, to a critical interrogation grounded in a comprehensive interpretation of Whitehead's categorical logic. On this basis it is argued that Dopfer and Pott's axiomatic approach lacks in both rigour and depth, thus failing to achieve its methodological objectives. While theoretical cross-overs between thermodynamics and economics are well known, the paper goes on to examine recent developments in nonequilibrium thermodynamics and complexity theory, arguing that Dopfer and Potts provide few insights into how recent developments in non-equilibrium thermodynamics could inform economic analysis.