Sydsvenskans Per T Ohlsson — ännu en nonsens-pladdrande Pellejöns

24 August, 2014 at 11:18 | Posted in Politics & Society | 2 Comments

DumstrutEn av landets mest välbetalda journalister — Per T Ohlsson — har i sin återkommande söndagskrönika i Sydvenskan i dag en mer än vanligt dåligt underbyggd artikel.

Denna gången handlar det om vänsterpartiets nej till vinster i den skattefinansierade välfärdssektorn.

Följande lilla stycke är belysande:

Om Vänsterpartiet skulle få sin vilja igenom dör en hel bransch med 11 000 företag och 160 000 anställda. Då måste stat och kommun ta över verksamheterna till en kostnad av flera tiotals miljarder kronor …

Varför en tung sektor som välfärden skulle må bättre av att undantas från varje tillstymmelse till vinstintresse framstår som obegripligt. Men så blir det när blind ideologi sätts före verkligheten.

Sverige är förvisso ett litet land, men ändå lyckas våra marknadsfundamentalistiska stödtrupper vaska fram dumstrutsförsedda riks-pellejönsar av Per T Ohlssons och Carl B Hamiltons kaliber. Imponerande.

När det gäller sakfrågan här visar det sig när det kommer till kritan att Per T — som vanligt — är fullständigt ute och reser.

Vinstdrivande företag inom vård- och skolsektor har diskuterats mycket det senaste året. Många är med rätta upprörda.

Många som är verksamma inom skolvärlden eller vårdsektorn har haft svårt att förstå alliansens och socialdemokratins inställning till privatiseringar och vinstuttag i den mjuka välfärdssektorn. Av någon outgrundlig anledning har de under många år pläderat för att vinster ska vara tillåtna i skolor och vårdföretag. Ofta har argumentet varit att driftsformen inte har någon betydelse. Så är inte fallet. Driftsform och att tillåta vinst i välfärden har visst betydelse. Och den är negativ.

Allinasen och socialdemokratin är förvisso långt ifrån ensamt om sitt velande. Från Svenskt Näringsliv och landets alla ledarskribenter hörs en jämn ström av krav på ökad kontroll, tuffare granskning och inspektioner.

Men vänta lite nu! Var det inte så att när man på 1990-talet påbörjade systemskiftet inom välfärdssektorn ofta anförde som argument för privatiseringarna att man just skulle slippa den byråkratiska logikens kostnader i form av regelverk, kontroller och uppföljningar? Konkurrensen – denna marknadsfundamentalismens panacé – skulle ju göra driften effektivare och höja verksamheternas kvalitet. Marknadslogiken skulle tvinga bort de “byråkratiska” och tungrodda offentliga verksamheterna och kvar skulle bara finnas de bra företagen som “valfriheten” möjliggjort.

Och nu när den panglossianska privatiseringsvåtdrömmen visar sig vara en mardröm så ska just det som man ville bli av med – regelverk och “byråkratisk” tillsyn och kontroll – vara lösningen?

Man tar sig för pannan – och det av många skäl!

För ska man genomföra de åtgärdspaket som förs fram undrar man ju hur det går med den där effektivitetsvinsten. Kontroller, uppdragsspecifikationer, inspektioner m m kostar ju pengar och hur mycket överskott blir det då av privatiseringarna när dessa kostnader också ska räknas hem i kostnads- intäktsanalysen? Och hur mycket värd är den där “valfriheten” när vi ser hur den gång på gång bara resulterar i verksamhet där vinst genereras genom kostnadsnedskärningar och sänkt kvalitet?

All form av ekonomisk verksamhet bygger på eller inbegriper någon form av delegering. En part (uppdragsgivaren, principalen, beställaren) vill att en annan part (uppdragstagaren, agenten, utföraren) ska utföra en viss uppgift. Grundproblemet är hur beställaren ska få utföraren att utföra uppdraget på det sätt som beställaren önskar …

Det finns en uppenbar fara i att basera ersättningssystem på enkla objektiva mått när det vi vill ersätta i själva verket har flera och komplexa dimensioner, exempelvis ersättning efter antal utskrivna patienter, lärarlöner kopplade till betyg eller dylikt. Ofta har kommunala verksamheter denna karaktär av “fleruppgiftsverkamhet” och då fungerar ofta inte incitamentkontrakt eller provisioner. I sådana fall kan “byråkratier” vara mer ändamålsenliga än marknader …

Effektiv resursanvändning kan aldrig vara ett mål i sig. Däremot kan det vara ett nödvändigt medel för att nå uppsatta mål. Välfärdsstatens vara eller icke vara är därför i grunden inte bara en fråga om ekonomisk effektivitet, utan också om våra föreställningar om ett värdigt liv, rättvisa och lika behandling.

Lars Pålsson Syll et al, Vad bör kommunerna göra? (Jönköping University Press, 2002)

Så grundfrågan är inte om skattefinansierade privata företag ska få göra vinstuttag eller om det krävs hårdare tag i form av kontroll och inspektion. Grundfrågan är om det är marknadens och privatiseringarnas logik som ska styra våra välfärdsinrättningar eller om det ska ske via demokratins och politikens logik. Grundfrågan handlar om den gemensamma välfärdssektorn ska styras av demokrati och politik eller av marknaden.

Ingen borde svaja i denna fråga, speciellt inte efter att ha läst följande stycke, skrivet av den kanske främste nu levande nationalekonomen i världen, nobelpristagaren i ekonomi år 1972, Kenneth Arrow, som i ett klassiskt arbete om vårdsektorns ekonomi redan år 1963 skrev följande visa ord:

Under ideal insurance the patient would actually have no concern with the informational inequality between himself and the physician, since he would only be paying by results anyway, and his utility position would in fact be thoroughly guaranteed. In its absence he wants to have some guarantee that at least the physician is using his knowledge to the best advantage. This leads to the setting up of a relationship of trust and confidence, one which the physician has a social obligation to live up to … The social obligation for best practice is part of the commodity the physician sells, even though it is a part that is not subject to thorough inspection by the buyer.

One consequence of such trust relations is that the physician cannot act, or at least appear to act, as if he is maximizing his income at every moment of time. As a signal to the buyer of his intentions to act as thoroughly in the buyer’s behalf as possible, the physician avoids the obvious stigmata of profit-maximizing … The very word, ‘profit’ is a signal that denies the trust relation.

Kenneth Arrow, “Uncertainty and the Welfare Economics of Medical Care”, American Economic Review, 53 (5).

Så låt oss stilla be för att herr Ohlsson, nästa gång han  sätter sig ner för att skriva en artikel, först kollar vad forskarvärlden säger. Det ger mycket mer än tyckmyckentrutat nonsens-pladder!

Apache

23 August, 2014 at 22:10 | Posted in Varia | 2 Comments


Old love dies hard

RCTs — false validity claims

23 August, 2014 at 19:33 | Posted in Theory of Science & Methodology | 4 Comments

As yours truly has repeatedly argued (here here here) on this blog, RCTs usually do not provide evidence that their results are exportable to other target systems. The almost religious belief with which its propagators portray it, cannot hide the fact that RCTs cannot be taken for granted to give generalizable results. That something works somewhere is no warranty for it to work for us or even that it works generally.

In an extremely interesting article on the grand claims to external validity often raised by advocates of RCTs, Lant Pritchett  and Justin Sandefur now confirm this view and show that using an RCT is not at all the “gold standard” it is portrayed as:

 

Our point here is not to argue against any well-founded generalization of research findings, nor against the use of experimental methods. Both are central pillars of scientific research. As a means of quantifying the impact of a given development project, or measuring the underlying causal parameter of a clearly-specified economic model, field experiments provide unquestioned advantages over observational studies.

Test-GroupBut the popularity of RCTs in development economics stems largely from the claim that they provide a guide to making “evidence-based” policy decisions. In the vast majority of cases, policy recommendations based on experimental results hinge not only on the interior validity of the treatment effect estimates, but also on their external validity across contexts.

Inasmuch as development economics is a worthwhile, independent field of study – rather than a purely parasitic form of regional studies, applying the lessons of rich-country economies to poorer settings – its central conceit is that development is different. The economic, social, and institutional systems of poor countries operate differently than in rich countries in ways that are sufficiently fundamental to require different models and different data.

It is difficult if not impossible to adjudicate the external validity of an individual eperimental result in isolation. But experimental results do not exist in a vacuum. On many development policy questions, the literature as a whole — i. e., the combination of experimental and non-experimental results across multiple contexts — collectively invalidate any claim of external validity for any individual experimental result.

Lant Pritchett & Justin Sandefur

Life among the Econ

23 August, 2014 at 11:03 | Posted in Economics | Leave a comment

A comparison of status relationships in the different “fields” shows a definite common pattern. The dominant feature, which makes status relations among the Econ of unique interest to the serious student, is the way that status is tied to the manufacture of certain types of implements called “modls.” RealWorld2The status of the adult male is determined by his skill at making the “modl” of his “field.” The facts (a) that the Econ are highly status-motivated, (b) that status is only to be achieved by making “modls,” and (c) that most of these “modls” seem to be of little or no practical use, probably accounts for the backwardness and abject cultural poverty of the tribe. Both the tight linkage between status in the tribe and modl making and the trend toward making modls more for ceremonial than for practical purposes appear, moreover, to be fairly recent developments, something which has led many observers to express pessimism for the viability of the Econ culture.

Axel Leijonhufvud

Fem skäl att ifrågasätta randomiserade kontrollstudier

23 August, 2014 at 10:17 | Posted in Theory of Science & Methodology | Leave a comment

rctYours truly har i ett antal artiklar här på bloggen — se t. ex. här, här och här — ifrågasatt värdet av randomiserade kontrollstudier (RKS) utifrån vetenskapsteoretiska och metodologiska utgångspunkter. I ett läsvärt gästinläggekonomistas ifrågasätter Björn Ekman starkt värdet av RKS som vägledning för biståndsarbete:

Randomisering är svårt. Det är i själva verket så knepigt att uppnå en ”ren” randomisering att det till och med kan vara en utmaning i laboratoriemiljö, dvs där metoden först uppstod och där man, i princip, kan kontrollera för alla de faktorer som man vill ta hänsyn till …

Randomisering behövs inte …

Randomisering svarar bara delvis på relevanta frågor. Ett problem med RKS-insatser som till och med många ”randomistas” åtminstone delvis håller med om är de relativt begränsade frågor som en sådan typ av insats ger svar på. Grovt sagt så svarar en randomiserad studie på om just den här insatsen fungerade just i denna kontext vid den här tidpunkten, dvs den har hög intern validitet. Det är inte oväsentliga svar, men de ger inte vid handen om insatsen bör utvidgas till andra områden och förhållanden. För svar på sådana frågor behövs studier med hög extern validitet.

Randomisering är inte tillämpbart inom stora delar av biståndet. Det är mycket möjligt, kanske till och med troligt, att det finns biståndsfinansierade projekt och insatser som bör designas och genomföras på ett randomiserat sätt för att utvärdera dess effekter. Men, de insatserna tillhör sannolikt minoriteten av allt det som finansieras av bistånd. Det allra mesta går inte att genomföra på ett slumpmässigt och kontrollerat sätt.

Dessutom finns det uppenbara etiska aspekter på en insats genomförande där man ger en grupp ett bevisligen effektivt medel, medan en annan grupp inte tilldelas samma medel …

Randomisering är inte kostnadseffektivt. Att genomföra en randomiserad kontrollstudie är dyrt, väldigt dyrt.

Annie Lööf har — som vanligt — otur när hon försöker tänka

23 August, 2014 at 09:49 | Posted in Politics & Society | Leave a comment

I Annie Lööfs sommartal och talet hon höll på Centerpartiets valkonvent nyligen berättade hon om en ung tjej som hon hade träffat. Tjejen hade gått från Fas 3 till att driva ett eget företag och var nu orolig för att hennes läxhjälpsföretag ska tvingas stänga om Alliansen förlorar valet.annie Därmed lyfts tjejen upp som en av alla de småföretagare som Centern går till val på att stödja och som de rödgröna vill tvinga bort från arbetsmarknaden. Lööf berättar att tjejen nu känner att hon duger, att hon tycker att hon ”tjänar så himla mycket pengar” för att hon förra året drog in 50 000 kronor, alltså 4 167 kronor i månaden. Det är mindre än det lägsta aktivitetsstödet …

Lucia Ramirez Tuesta, som är fritidsledare i Vårberg … håller med om att det måste vara skönt att ta sig ur Fas 3.

– Att kunna försörja sig själv är så klart en lättnad efter Fas 3, men jag tycker att det är sinnessjukt att det är så lite pengar. Jag har tjänat så några gånger när jag var timavlönad och inte fick jobba så mycket – efter att jag köpt för ett SL-kort, lite mat och betalat en räkning fanns inga pengar kvar. Ofta räckte det inte ens till räkningar.

Hon undrar hur Lööf, som tjänar 161 000 kronor i månaden, skulle klara sig på en sådan lön.

– Jag skulle gärna vilja se Annie Lööf leva på 4 000 kronor i månaden. Skulle hon klara att äta, ta sig till jobbet och ha en värdig fritid? Det är fullständigt idiotiskt att lyfta det som positivt. I slutändan handlar det ju om pengarna – vi lever i ett samhälle där pengar avgör om man har ett värdigt liv eller inte och jag undrar hur den här personen lever.

ETC

Then the chilly winds blew down (private)

23 August, 2014 at 09:15 | Posted in Varia | Leave a comment


In loving memory of my brother

Econometric business cycle research

21 August, 2014 at 19:33 | Posted in Statistics & Econometrics | 1 Comment

The wide conviction of the superiority of the methods of the science has converted the econometric community largely to a group of fundamentalist guards of mathematical rigour. It is often the case that mathemical rigour is held as the dominant goal and the criterion for research topic choice as well as research evaluation, so much so that the relevance of the research to business cycles is reduced to empirical illustrations. To that extent, probabilistic formalization has trapped econometric business cycle research in the pursuit of means at the expense of ends.

Economic_cycle.svg

Once the formalization attempts have gone significantly astray from what is needed for analysing and forecasting the multi-faceted characteristics of business cycles, the research community should hopefully make appropriate ‘error corrctions’ of its overestimation of the power of a priori postulated models as well as its underestimation of the importance of the historical approach, or the ‘art’ dimewnsion of business cycle research.

Duo Qin A History of Econometrics (OUP 2013)

Econometric forecasting — a retrospective assessment

20 August, 2014 at 12:11 | Posted in Statistics & Econometrics | Leave a comment

411e9aO5PCL._SY344_BO1,204,203,200_There have been over four decades of econometric research on business cycles … The formalization has undeniably improved the scientific strength of business cycle measures …

But the significance of the formalization becomes more difficult to identify when it is assessed from the applied perspective, especially when the success rate in ex-ante forecasts of recessions is used as a key criterion. The fact that the onset of the 2008 financial-crisis-triggered recession was predicted by only a few ‘Wise Owls’ … while missed by regular forecasters armed with various models serves us as the latest warning that the efficiency of the formalization might be far from optimal. Remarkably, not only has the performance of time-series data-driven econometric models been off the track this time, so has that of the whole bunch of theory-rich macro dynamic models developed in the wake of the rational expectations movement, which derived its fame mainly from exploiting the forecast failures of the macro-econometric models of the mid-1970s recession.

The limits of econometric forecasting has, as noted by Qin, been critically pointed out many times before.

Trygve Haavelmo — with the completion (in 1958) of the twenty-fifth volume of Econometrica – assessed the the role of econometrics in the advancement of economics, and although mainly positive of the “repair work” and “clearing-up work” done, Haavelmo also found some grounds for despair:

We have found certain general principles which would seem to make good sense. Essentially, these principles are based on the reasonable idea that, if an economic model is in fact “correct” or “true,” we can say something a priori about the way in which the data emerging from it must behave. We can say something, a priori, about whether it is theoretically possible to estimate the parameters involved. And we can decide, a priori, what the proper estimation procedure should be … But the concrete results of these efforts have often been a seemingly lower degree of accuracy of the would-be economic laws (i.e., larger residuals), or coefficients that seem a priori less reasonable than those obtained by using cruder or clearly inconsistent methods.

Haavelmo-intro-2-125397_630x210There is the possibility that the more stringent methods we have been striving to develop have actually opened our eyes to recognize a plain fact: viz., that the “laws” of economics are not very accurate in the sense of a close fit, and that we have been living in a dream-world of large but somewhat superficial or spurious correlations.

And as the quote below shows, even Ragnar Frisch shared some of Haavelmo’s — and Keynes’s — doubts on the applicability of econometrics:

sp9997db.hovedspalteI have personally always been skeptical of the possibility of making macroeconomic predictions about the development that will follow on the basis of given initial conditions … I have believed that the analytical work will give higher yields – now and in the near future – if they become applied in macroeconomic decision models where the line of thought is the following: “If this or that policy is made, and these conditions are met in the period under consideration, probably a tendency to go in this or that direction is created”.

Ragnar Frisch

Econometrics may be an informative tool for research. But if its practitioners do not investigate and make an effort of providing a justification for the credibility of the assumptions on which they erect their building, it will not fulfill its tasks. There is a gap between its aspirations and its accomplishments, and without more supportive evidence to substantiate its claims, critics will continue to consider its ultimate argument as a mixture of rather unhelpful metaphors and metaphysics. Maintaining that economics is a science in the “true knowledge” business, I remain a skeptic of the pretences and aspirations of econometrics. So far, I cannot really see that it has yielded very much in terms of relevant, interesting economic knowledge. And, more specifically,  when it comes to forecasting activities, the results have been bleak indeed.

The marginal return on its ever higher technical sophistication in no way makes up for the lack of serious under-labouring of its deeper philosophical and methodological foundations that already Keynes complained about. The rather one-sided emphasis of usefulness and its concomitant instrumentalist justification cannot hide that the legions of probabilistic econometricians who give supportive evidence for their considering it “fruitful to believe” in the possibility of treating unique economic data as the observable results of random drawings from an imaginary sampling of an imaginary population, are scating on thin ice. After having analyzed some of its ontological and epistemological foundations, I cannot but conclude that econometrics on the whole has not delivered “truth,” nor robust forecasts. And I doubt if it has ever been the intention of its main protagonists.

Our admiration for technical virtuosity should not blind us to the fact that we have to have a more cautious attitude towards probabilistic inference of causality in economic contexts. Science should help us penetrate to — as Keynes put it — “the true process of causation lying behind current events” and disclose “the causal forces behind the apparent facts.”  We should look out for causal relations, but econometrics can never be more than a starting point in that endeavour, since econometric (statistical) explanations are not explanations in terms of mechanisms, powers, capacities or causes. Firmly stuck in an empiricist tradition, econometrics is only concerned with the measurable aspects of reality, But there is always the possibility that there are other variables – of vital importance and although perhaps unobservable and non-additive not necessarily epistemologically inaccessible – that were not considered for the model. Those who were can hence never be guaranteed to be more than potential causes, and not real causes.

A rigorous application of econometric methods in economics really presupposes that the phenomena of our real world economies are ruled by stable causal relations between variables. A perusal of the leading econom(etr)ic journals shows that most econometricians still concentrate on fixed parameter models and that parameter-values estimated in specific spatio-temporal contexts are presupposed to be exportable to totally different contexts. To warrant this assumption one, however, has to convincingly establish that the targeted acting causes are stable and invariant so that they maintain their parametric status after the bridging. The endemic lack of predictive success of the econometric project indicates that this hope of finding fixed parameters is a hope for which there really is no other ground than hope itself.

This is a more fundamental and radical problem than the celebrated “Lucas critique” have suggested. This is not the question if deep parameters, absent on the macro-level, exist in “tastes” and “technology” on the micro-level. It goes deeper. Real world social systems are not governed by stable causal mechanisms or capacities. It is the criticism that Keynes — in Essays in Biography — first launched against econometrics and inferential statistics already in the 1920s:

The atomic hypothesis which has worked so splendidly in Physics breaks down in Psychics. We are faced at every turn with the problems of Organic Unity, of Discreteness, of Discontinuity – the whole is not equal to the sum of the parts, comparisons of quantity fails us, small changes produce large effects, the assumptions of a uniform and homogeneous continuum are not satisfied. Thus the results of Mathematical Psychics turn out to be derivative, not fundamental, indexes, not measurements, first approximations at the best; and fallible indexes, dubious approximations at that, with much doubt added as to what, if anything, they are indexes or approximations of.

The kinds of laws and relations that econom(etr)ics has established, are laws and relations about entities in models that presuppose causal mechanisms being atomistic and additive. When causal mechanisms operate in real world social target systems they only do it in ever-changing and unstable combinations where the whole is more than a mechanical sum of parts. If economic regularities obtain they do it (as a rule) only because we engineered them for that purpose. Outside man-made “nomological machines” they are rare, or even non-existant. Unfortunately that also makes most of the achievements of econometrics – as most of contemporary endeavours of economic theoretical modeling – rather useless.

Leontief’s uneasy feeling about the state of economics

19 August, 2014 at 18:25 | Posted in Economics | 1 Comment

Much of current academic teaching and research has been criticized for its lack of relevance, that is, of immediate practical impact … I submit that the consistently indifferent performance in practical applications is in fact a symptom of a fundamental imbalance in the present state of our discipline. The weak and all too slowly growing empirical foundation clearly cannot support the proliferating superstructure of pure, or should I say, speculative economic theory …

004806Uncritical enthusiasm for mathematical formulation tends often to conceal the ephemeral substantive content of the argument behind the formidable front of algebraic signs … In the presentation of a new model, attention nowadays is usually centered on a step-by-step derivation of its formal properties. But if the author — or at least the referee who recommended the manuscript for publication — is technically com- petent, such mathematical manipulations, however long and intricate, can even without further checking be accepted as correct. Nevertheless, they are usually spelled out at great length. By the time it comes to interpretation of the substantive conclusions, the assumptions on which the model has been based are easily forgotten. But it is precisely the empirical validity of these assumptions on which the usefulness of the entire exercise depends.

What is really needed, in most cases, is a very difficult and seldom very neat assessment and verification of these assumptions in terms of observed facts. Here mathematics cannot help and because of this, the interest and enthusiasm of the model builder suddenly begins to flag: “If you do not like my set of assumptions, give me another and I will gladly make you another model; have your pick.” …

But shouldn’t this harsh judgment be suspended in the face of the impressive volume of econometric work? The answer is decidedly no. This work can be in general characterized as an attempt to compensate for the glaring weakness of the data base available to us by the widest possible use of more and more sophisticated statistical techniques. Alongside the mounting pile of elaborate theoretical models we see a fast-growing stock of equally intricate statistical tools. These are intended to stretch to the limit the meager supply of facts … Like the economic models they are supposed to implement, the validity of these statistical tools depends itself on the acceptance of certain convenient assumptions pertaining to stochastic properties of the phenomena which the particular models are intended to explain; assumptions that can be seldom verified.

Wassily Leontief

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