SoylentNews is people
SoylentNews
When Christopher Nolan was promoting his previous film Interstellar, he made the casual observation that "Take a field like economics for example. [Unlike physics] you have real material things and it can't predict anything. It's always wrong." There is a lot more truth in that statement than most academic economists would like to admit.
[...] several famous Keynesian and neo-classical economists, including Paul Romer, [...] criticized the "Mathiness in the Theory of Economic Growth" and [...] Paul Krugman. In this instance, though, Krugman is mostly correct observing that "As I see it, the economics profession went astray because economists, as a group, mistook beauty, clad in impressive-looking mathematics, for truth."
[...] But more fundamentally, as Austrian economist Frank Shostak notes, "In the natural sciences, a laboratory experiment can isolate various elements and their movements. There is no equivalent in the discipline of economics. The employment of econometrics and econometric model-building is an attempt to produce a laboratory where controlled experiments can be conducted."
The result is that economic forecasts are usually just wrong."
"[Levinovitz] approvingly quotes one economist saying "The interest of the profession is in pursuing its analysis in a language that's inaccessible to laypeople and even some economists. What we've done is monopolise this kind of expertise.[...] that gives us power.""
[...] because economics models are mostly useless and cannot predict the future with any sort of certainty, then centrally directing an economy would be effectively like flying blind. The failure of economic models to pan out is simply more proof of the pretense of knowledge. And it's not more knowledge that we need, it's more humility. The humility to know that "wise" bureaucrats are not the best at directing a market "
Economists Are the New Astrologers
(Score: 3, Informative) by Thexalon on Wednesday August 30 2017, @04:30PM
They can tell you a great deal about what happened. What they tell you absolutely nothing about is why it happened, which is a critical question in economic theory.
Let's say, for instance, that sales of bottled water are up significantly in and around Austin, Texas for the month of August versus July. Is this because:
1. The price per bottle dropped significantly?
2. The hurricane increased demand for bottled water from people escaping the flooding?
3. The bottled water companies ran a great new ad campaign?
4. A technological innovation in bottled water substantially improved the quality and/or convenience of the product?
5. Austin tap water is perceived as contaminated somehow?
6. A bunch of bottled-water-loving college kids came to town to start school at UTexas-Austin?
7. Wages increased overall in Austin, so people who preferred bottled water over tap water but weren't drinking it because they couldn't afford it now can afford it?
And the answer could be any combination of those, or something else that I didn't think of. If I had to guess, the hurricane explanation will probably be the most correct, but I'm quite certain nobody really knows. And which answer you give has an effect on what if any policy responses are appropriate.
The only thing that stops a bad guy with a compiler is a good guy with a compiler.