TY  - JOUR
PY  - 2011//
TI  - Falsifiability
JO  - American economic review
A1  - Olszewski, Wojciech
A1  - Sandroni, Alvaro
SP  - 788
EP  - 818
VL  - 101
IS  - 2
N2  - We examine Popper's falsifiability within an economic model in which a tester hires a potential expert to produce a theory. Payments are contingent on the performance of the theory vis-à-vis data. We show that if experts are strategic, falsifiability has no power to distinguish scientific theories from worthless theories. The failure of falsification in screening informed and uninformed experts motivates questions on the broader concepts of refutation and verification. We demonstrate an asymmetry between the two concepts. Like falsification, verification contracts have no power to distinguish between informed and uninformed experts, but some refutation contracts are capable of screening experts. (JEL B41)<p /> <p>Language: en</p>
LA  - en
SN  - 0002-8282
UR  - http://dx.doi.org/10.1257/aer.101.2.788
ID  - ref1
ER  -