Approximate Truth in Economic Modelling

Economic intuitions concerning rational behaviour in interactive social situations are shaped byidealized models which are regarded as “approximately true”. But ideal models cannot be meaningfullydeemed approximately true unless asymptotically convergent processes imply them as limit cases. Weillustrate by various examples – infinitely patient customers on durable monopoly markets,homogeneity of commodities, super-games etc. – how this necessary methodological requirement isalmost routinely neglected. On this basis we draw some conclusions concerning the continuitybetween abstract and less abstract models on the one and the world modelled by them on the otherhand.