Leontief and Samuelson on the Non-Substitution Theorem

Abstract

The non-substitution theorem was first demonstrated by Samuelson and Georgescu-Roegen for a generalized model of Leontief. The theorem raised the question to know if the “deep-seated causes of [economic] development are to be found in the variations of the basic structural relationships themselves_ that is in modification of changes in consumers’ tastes_ and changes in the structure of productive processes” (Leontief). Without advanced empirical evidence, this episode brought at the core of linear economics the substitution principle and consider Leontief’s assumption of non-substitutions among production factors as simplistic and unsatisfactory. This can be viewed as an anomaly for the philosophy of science: a change in a research program without empirical anomalies but only a certain epistemological and theoretical context.