Question

Why is it unfair or meaningless to criticize a theory

as “unrealistic?”

Short answer

Because they have to be based on unrealisitic assumptions to simplify complex topics.

Step-by-step solution

Step:1 Concept Introduction

Essentially, a theory (Economics theory) is based on common observation or behaviour in a certain context. A hypothesis is founded on empirical evidence that can be justified according to the situation. Though we have some assumptions about the theories, they are employed to make the ideas more understandable.

Step:2 Comparison of theory with actual life

When we say a theory is impractical, we're referring to the fact that it isn't applicable in actual life. It is possible that if a theory is established in response to a current circumstance, and the situation changes over time, the theory will lose its validity.

Step:3 Few more Examples

As new research and timelines emerge, theories shift as well. Classical ideas (supply side theories-dealing market) were transformed into Keynesian theories (demand side theories-dealing recession) and then to monetarists (dealing stagflation). In this circumstance, we cannot conclude that any one sort of thought is completely incorrect; rather, they were utilised as a basis and then expanded upon as new situations arose in the world.

Another example is the Phillips Curve, which depicts an inverse relationship between inflation and unemployment and was accepted as a generic idea at the time. However, it evolved further, and its validity was only examined in the short term.

As a result, we might conclude that criticising any theory as impractical is unjust.