Friday , December 6 2019
Home / Tag Archives: Economic Methods

Tag Archives: Economic Methods

Immigration Research for the Future?

Question from an anonymous reader, reprinted with permission: Hi Bryan, First of all, I’d like to say that I really loved your new book Open Borders! It’s an amazing feat in terms of making a clear case, exploring many arguments and counter-arguments and presenting everything in a fun, engaging way. I have one question for you. After having gone through all the literature for this book, where do you think additional research is more likely to have a high marginal...

Read More »

So If Incentives Are Overrated…

New Nobelists Duflo and Bannerjee in the NYT: [E]conomists have somehow managed to hide in plain sight an enormously consequential finding from their research: Financial incentives are nowhere near as powerful as they are usually assumed to be. David’s critique is excellent.  But supposing Duflo and Bannerjee are right, I have a few questions. If incentives are overrated… 1. Is it OK to reduce penalties for tax evasion? 2. Is it OK to cut regulatory enforcement? 3. Is...

Read More »

Nobel Laureates Aim Too Low on Global Poverty

The Royal Swedish Academy of Sciences will award the 2019 Nobel Prize in Economic Sciences to Abhijit Banerjee and Esther Duflo of the Massachusetts Institute of Technology and Michael Kremer of Harvard “for their experimental approach to alleviating global poverty.” The award reveals a deepening fault line among economists about how best to fight poverty. What’s striking about the award is that the Nobel committee gave it to the three economists specifically for addressing “smaller, more...

Read More »

The One Big Fact that Overawes All Doubts

How do I pick book topics?  On reflection, I usually start with what appears to be a big blatant neglected fact.  Then I try to discover whether anything in the universe is big enough to explain this alleged fact away.  If a laborious search uncovers nothing sufficient, I am left with the seed of a book: One Big Fact that Overawes All Doubts. Thus, my Myth of the Rational Voter starts with what appears to be a big blatant neglected fact: the typical voter seems...

Read More »

Can tariffs have a deflationary impact?

Before I read Deirdre McCloskey, I had a rather primitive view of methodology. Economists should develop hypotheses and then test these theories using real world data. Models were mathematical and empirical tests used regression analysis. Today, I have a more eclectic view.  A macroeconomist uses basic economic concepts, stylized facts and financial market reactions to news in order to develop a framework for understanding important macro phenomena.  Influential...

Read More »

Theory and practice

Before getting to today’s post, I’d like to correct my previous post on Brexit.  When discussing the impact of Brexit on British growth, I forgot the evidence from asset prices.  The British pound falls on news that Brexit is more likely, and falls even more on “no deal Brexit” becoming more likely.  It’s hard to quantify that evidence, but it certainly counts for something. Alex Tabarrok discusses research by the recent winners of the Nobel Prize in Economics.  This...

Read More »

How Crackpotted is Your Economics?

Courtesy of a lovely little article in Lapham’s Quarterly titled “Beware of Cranks” I have recently discovered the incredibly useful “Crackpot Index” developed in 1992 by the physicist John C. Baez as a way of computing precisely how nutty the nutty theories of various amateur mathematicians are. Mathematicians apparently have a particular need for this kind of rating system. A similar crackpot index exists for theories specifically about prime numbers, and an earlier...

Read More »

How Crackpotted is Your Economics?

Courtesy of a lovely little article in Lapham’s Quarterly titled “Beware of Cranks” I have recently discovered the incredibly useful “Crackpot Index” developed in 1992 by the physicist John C. Baez as a way of computing precisely how nutty the nutty theories of various amateur mathematicians are. Mathematicians apparently have a particular need for this kind of rating system. A similar crackpot index exists for theories specifically about prime numbers, and an earlier...

Read More »

The Latest Nobel Prize in Economics

The Royal Swedish Academy of Sciences will award the 2019 Nobel Prize in Economic Sciences to Abhijit Banerjee and Esther Duflo of the Massachusetts Institute of Technology and Michael Kremer of Harvard “for their experimental approach to alleviating global poverty.” The award reveals a deepening fault line among economists about how best to fight poverty. What’s striking about the award is that the Nobel committee gave it to the three economists specifically for...

Read More »

Rational expectations isn’t the problem; it’s the solution.

Edward Luce has a very misleading piece in the Financial Times. Here’s an excerpt: Why do economists continue to get it so wrong? One answer is that not all of them do. David Blanchflower, who was on the Bank of England’s monetary policy committee during the 2008 crash, insists that evidence of an impending crash was hidden in plain view long before it happened. Blanchflower, whose book Not Working: Where Have all the Good Jobs Gone? is a stinging rebuke to his...

Read More »