I admit I haven't read or even heard of Kate Raeworth, but I am an academic economist. Most modern economic research is empirical, a paper poses a policy-relevant empirical question 'did policy X reduce unemployment' and then empirical evidence is presented (perhaps using data from a randomly controlled trial or using quasi-experimental variation). The statistics are calculated and the assumptions required for the validity of the statistical analysis discussed critically and at great length. Undergraduate econ classes unfortunately leave students with the impression that academic econ is mostly unrealistic theoretical models of behavior, but those models are just handy tools for hypothesis formation, and it is the empirical testing of hypotheses that makes a discipline a science, not the manner by which those hypotheses were formed.
Hypothesis driven research disregarding rigoriousness of hypothesis formation is most often flawed, as the hypotheses will be filled with suspicious/flawed concepts that cannot serve as reliable and meaningful abstraction of reality.
Consider the measures prefixed with 'real', for example, 'real wage'. The concept of 'real wage' isn't meaningless, since it captures the relation between wage and purchasing power when inflation is involved. But what about cases where inflation is not involved, or cases where we need to consider interactions between some other factors and inflation? In those cases, the concept of 'real wage' is often impedimental and misleading, a ratio indicating purchasing power would surely be a better choice.
Consider the concept of 'equilibrium'. I can hardly see any empirical foundation of 'equilibrium' when it's invoked by empirical economics research. There are stationary periods of prices. But it's a different story to interpret such stationariness as a state of equilibrium with a mysterious process forcing prices to always gravitate to this state. This interpretation is without empirical foundation and yet its reliability is often assumed a priori in the research.
If you are not persuaded, it's okay. Regardless, I don't believe hypothesis formation is irrelevant.
EDIT: On second thought, my case against 'real wage' above was missing the key. The key is that purchasing power is what matters, and the purchasing power (most of the time local) of stock variables (e.g. savings) is what matters. To adjust flow variables by inflation is often misleading.
Well, at the very least, the argument over hypothesis formation is not specific to economics. The philosopher of science Karl Popper argued that science should aim to empirically falsify hypotheses, and that the way scientists develop those hypotheses, while an interesting psychological question, is irrelevant for the scientific method. He argued that hypothesis formation always contains an element of irrationality and instinct and he quotes Einstein who expressed views to that effect.
