Econometrics — science based on whimsical assumptions

4 June, 2015 at 12:35 | Posted in Economics | 1 Comment

overconfidenceIn order to draw inferences from data as described by econometric texts, it is necessary to make whimsical assumptions. The professional audience consequently and properly withholds belief until an inference is shown to be adequately insensitive to the choice of assumptions. The haphazard way we individually and collectively study the fragility of inferences leaves most of us unconvinced that any inference is believable. If we are to make effective use of our scarce data resource, it is therefore important that we study fragility in a much more systematic way. If it turns out that almost all inferences from economic data are fragile, I suppose we shall have to revert to our old methods …

Ed Leamer

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  1. Look, do you really want force Paul Krugman to once again describe your posts to his large blog audience as “diatribes,” or will you please be reasonable, dare to be silly, and shut up already about how their entire research agenda is really a kind of mathy (h/t the very busy Paul Romer) story-telling (http://krugman.blogs.nytimes.com/2014/03/26/dare-to-be-silly/)


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