The Reaction Engine

The engine of economical phenomena is human action . The reaction engine, presented here, exploits this fact by explicitely making human action the cause of all changes in th e case of a market economy. This offers a natural way of grounding causal reasoning abou t economical phenomena . First this paper shows the limitations of the classical framework of Comparative Statics . Second it motivates the introduction of causal reasoning by higlighting the disambiguatin g power of causal arguments found in economic .textbook . Third it shows how the reaction engine encodes causal reasoning, and and takes advantage of it, to enhance reasoning abou t economical phenomena . THE REACTION ENGINE 2