The Truth Is out There - Anywhere. Alas, We Cannot See It Clearly.

Introduction

Ontology has been of crucial human interest for thousands of years. Movies, such as Matrix and series like the X-Files, puzzle people with confusion about the world they experience in daily life. By inducing them to question what they take for granted as reality. Claiming to know the ultimate truth is a very courageous statement that has to be proven. Does a statement like “It’s the truth and nothing but the truth” (Klamer,2006) really hold or is science more about the quest for the truth and coming as close to it as feasible?

The essay at hand will briefly elaborate on whether one should focus on the ultimate truth in a science like economics or whether we merely have to understand and investigate truth as a revelation of a picture that helps us to understand how the world works and finally approaches ultimate truth.

Truth and the role of epistemology

Often, two individuals in conversation with each other, experience a totally different subjective truth regarding their perceived reality. Arguably, we may consider one subjective version trustworthier than the other or consider the truth to be somewhere in between, as a relativist perspective would suggest. Nevertheless, we enter a sphere of confusion in daily life, as well as in science, and experience a strong desire for proof. In order to come close to the truth, there are several epistemological approaches. A realist bases his ground on logical consistency. Descartes, a pure rationalist, considered reason as the key to everything (Klamer, 2006). He defined universal truth in a geometric fashion. Leibniz explained universal truth mathematically and his basis served as a common ground for hard-nosed scientists. The Vienna circle proclaimed a hypothetic deductive approach towards scientific truth, whereas according to Rorty, scientific truth is a construction, which is in line with a relativist, post modern view that regards truth as “all opinion” (Klamer, 2006). All of these methodological approaches induce to think. One conclusion at this stage may be that universal truth is hard to define precisely.

Truth and its recognizability

One may argue that truth is, what is observable, as favoured by the philosopher Bacon (Klamer, 2006). At first hand this approach sounds logically consistent. It relies on induction. According to the positivist approach, what is empirically proven and thus observable is true (Klamer, 2006). As already Socrates figured out there is no direct knowledge of reality and we can only observe indirectly. Thus, what we see is biased and represents only a slice of reality (Klamer, 2006). Hence, induction alone is troublesome as no scientist is omniscient. Consequently, the claim to have seen and thus observed everything is illusory.

As Karl Popper states, one should make bold conjectures and try to refute them in order to come close to the truth. He proclaimed the falsification method, whereas Godel’s theorem states that we cannot achieve an absolute proof within a logical system (Klamer,2006). In an empirical hypothesis test, we face a growing beta error when trying to reduce the alpha error ad infinitum (Bowerman&O’Connell, 2003). Thus, even mathematically, which may be regarded as the most scientific approach, we get close to 100% but are not a 100% certainty. This point is underlined by the Duhem-Quine thesis (Klamer, 2006): Every empirical test would need an infinite number of preceding and subsequent hypotheses to be 100% sure. Moreover, using the falsification method as proclaimed by Popper, one couldn’t figure out precisely where the error lies. As scientists we work with assumptions, which form a constraint. Thus we are trying to get as close to the truth as possible, which may be regarded as a constrained maximization problem.

The truth alone

The truth itself or a perception of it will not necessarily be of great help to solve all problems in economics and business economics. Merely, it is the way to truth and what is connected with it that provides the greatest insight. According to Immanuel Kant “perceptions without conceptions are empty and conceptions without perceptions are blind” (Klamer, 2006). Kant’s epistemological approach combines rationalism and empiricism. Consequently, without conceptions facts are useless.

Regarding the restructuring process of Philips (Philips Case,2005) top management decided to shift from a production oriented company to consumer orientation with focus on customer satisfaction. Evidently, the undisputable true fact of deteriorating financial results and declining market share contributed to this decision. Costly market research helped gaining crucial information and made customer segmentation possible (Philips Case,2005). In line with a new philosophy, namely “Sense and Simplicity”, restructuring and the creation of a new brand image Philips underwent magnificent changes (Philips Case,2005). Hence, knowing the truth would mean knowing the precise reason why Philips lost market share. In fact, this is not necessarily what its top management found out by means of empirical research. The input of getting to know customer preferences helped in creating a profound future-oriented strategy. Moreover,