The relationship between Peircean abduction and the modern notion of Inference to the Best Explanation is a matter of dispute. Some philosophers, such as Harman :88–95, 1965) and Lipton, claim that abduction and IBE are virtually the same. Others, however, hold that they are quite different :503, 1998; Minnameier in Erkenntnis 60:75–105, 2004) and there is no link between them :419–442, 2009). In this paper, I argue that neither of these views is correct. I show that abduction and IBE have (...) important similarities as well as differences. Moreover, by bringing a historical perspective to the study of the relationship between abduction and IBE—a perspective that is lacking in the literature—I show that their differences can be well understood in terms of two historic developments in the history of philosophy of science: first, Reichenbach’s distinction between the context of discovery and the context of justification—and the consequent jettisoning of the context of discovery from philosophy of science—and second, underdetermination of theory by data. (shrink)

A constantly changing social reality means economic theories, even if correct today, need to be constantly revised, updated, or abandoned. To maintain an up-to-date understanding of its subject matter, economists have to continuously assess their theories even those that appear to be empirically corroborated. Economics could gain from a method that describes and is capable of generating novel explanatory hypotheses. A pessimistic view on the existence of such a method was famously articulated by Karl Popper in The Logic of Scientific (...) Discovery. He wrote ‘there is no such a thing as a logical method of having ideas or a logical reconstruction of this process.’ Herbert Simon responded to Popper and argued the opposite, namely, that there is a model of discovery and its name is abduction. Simon acknowledges his debt to Charles Peirce – the first modern logician to explicitly formulate a theory of abduction – and explains that abduction is a model of discovery that works as a problem-solving heuristic encoded.. (shrink)