This is an idea that could do with expanding on, but I've been reading Mark Johnson's book The Body in the Mind about the mechanics of metaphors and it occurred to me that economists are using a metaphor drawn from biology for the economy, i.e. homoeostatic regulation of an organism. Hence the focus on equilibria and and growth. An organism has a number of internal systems that are used to maintain our internal milieu within an optimum range: for example blood glucose, oxygen, and carbon dioxide levels, blood pressure, temperature etc.
At the moment we're hearing a lot about "external shocks" and the potential impact of them. This language is consistent with seeing the economy as a self-contained system that relates to other self-contained systems.
Heterodox economists (effectively) argue that the economy is not (metaphorically) an organism whose goal is homoeostasis, but (metaphorically) a complex inorganic system, like the climate which is subject to chaotic behaviour and has not goals. The economy must therefore be treated as though it is a large complex system like weather rather than an organism like ourselves.
Of course climate is also directly mediated by living things as well. If we had no biosphere the climate on earth would be very different. This idea has long been established by the independent chemist James Lovelock in his Gaia Hypothesis, but also in his work for NASA designing experiments to detect life on Mars. The easiest experiment according to Lovelock would be to look at the atmosphere of Mars through a telescope and use spectroscopy to determine the chemical composition of it. A sign of life would be a composition incompatible with a simple chemical equilibrium. For example mere chemical processes would not allow the earth's atmosphere to sustain its 21% oxygen content. Oxygen is highly reactive and would quickly disappear from our atmosphere if photosynthesising plants and bacteria were not constantly replenishing it. A chemical equilibrium would look very different from the biological equilibrium that we currently experience.
Free Market enthusiasts argue that markets would be self-regulating if only we left them to it. Of course markets are usually only partially free because governments interfere with their functioning. Large corporations also manipulate markets, for example by ganging up to set prices instead of competing. In fact any market participant with any power seeks to distort the market to their own benefit as a matter of course. So the Free Market is really only a superficial Newtonian view of markets. We need a relativistic view in which each player in the market distorts the local fabric of the economy proportionally according how much wealth they hold and/or create. In this view no market is free because to be a participant in a market is to distort it, in an analogous way to the distortion of spacetime by masses in Einstein's description of the universe.
As it happens we've seen a number of free market experiments, one of the most remarkable was Iraq where the post-invasion economy was set up according to pure Free Market doctrines. And Iraq is now a failed state, because all the players sought actively to distort the market from the get-go and some were dedicated to destroying it. Similar failures all around the world have yet to deter Free Market ideologues from their belief system. Ironically the Free Market proponents in Europe and the UK are also dedicated to anti-liberal regulation of the lives of citizens and using campaigns of psychological manipulation (aka nudging) to try to change behaviour in directions they approve of. It one accepts a government handout it seems to be assumed that one gives up all claim to liberty and hands over responsibility for one's life to the government.
Heterodox economists argue that no sensible physicist would treat a system as complex as an economy as homoeostatic (my word) because nowadays they have sophisticated methods for dealing with complex inorganic systems via the mathematics of complexity and chaos. This is quite a good argument until one reflects on just how complex the average cell is. Cells are made up of millions of large molecules, including tens of thousands of different kinds of proteins, produced and distributed by a highly sophisticated logistical system, powered by little power-plants (mitochondria) which are former free-living bacteria, and all to a blue print of nuclear DNA containing complex instructions in molecules folded for space saving most of the time. And all this is capable of reproducing itself. Trillions of these cells make up our body and its various systems - 80 billion neurons in the brain, plus another 100 million in the gut for example. No physicist would treat the body as a complex inorganic system because living organisms defy the physics of complexity and maintain themselves at or around an equilibrium.
In fact a homoeostatic organism, such as ourselves, is not such a bad metaphor after all. We circulate various commodities and currencies, process imports and exports, and do everything that an economy does, all with the aim of individual homoeostasis which leads to growth and reproduction. There is an isomorphism, as Johnson puts it, between an economy and an organism that allows the metaphor to work. In this model wealth is energy, it is exchanged in the form of tokens (e.g. glucose or ADP molecules), and circulates around. Debts can be created, for example, by anaerobic metabolism, but must be repaid. And so on.
So it is really madness as economists like Steve Keen suggest to think of the economy as tending to equilibrium? After all that is exactly what our bodies do. Why not model the economy as though it were an organism?