Lars P. Syll

The Fed is making a big mistake .[embedded content]

[unable to retrieve full-text content]

The geometry of Bayes theorem .[embedded content] An informative visualization of a theorem that shows how to update probabilities — calculating conditional probabilities — when new information/evidence becomes available. But … Although Bayes’ theorem is mathematically unquestionable, that doesn’t qualify it as indisputably applicable to scientific questions. Bayesian statistics is one thing, and Bayesian epistemology is something else. Science is not...

Knowing the contents of a toolbox, of course, requires statistical thinking, that is, the art of choosing a proper tool for a given problem. Instead, one single procedure that I call the “null ritual” tends to be featured in texts and practiced by researchers. Its essence can be summarized in a few lines: The null ritual: 1. Set up a statistical null hypothesis of “no mean difference” or “zero correlation.” Don’t specify the predictions of your research hypothesis or of any...

In 1817 David Ricardo presented — in Principles — a theory that was meant to explain why countries trade and, based on the concept of opportunity cost, how the pattern of export and import is ruled by countries exporting goods in which they have a comparative advantage and importing goods in which they have a comparative disadvantage. Ricardo’s theory of comparative advantage, however, didn’t explain why the comparative advantage was the way it was. At the beginning of the...

On probabilism and statistics ‘Mr Brown has exactly two children. At least one of them is a boy. What is the probability that the other is a girl?’ What could be simpler than that? After all, the other child either is or is not a girl. I regularly use this example on the statistics courses I give to life scientistsworking in the pharmaceutical industry. They all agree that the probability is one-half. So they are all wrong. I haven’t said that the older...

Mainstream economics — a methodological reductionist strait-jacket. Jamie Morgan: To a member of the public it must seem weird that it is possible to state, as you do, such fundamental criticism of an entire field of study. The perplexing issue from a third party point of view is how do we reconcile good intention (or at least legitimate sense of self as a scholar), and power and influence in the world with error, failure and falsity in some primary sense;...

Propensity score matching (student stuff) .[embedded content]

Abduction — beyond deduction and induction Science is made possible by the fact that there are structures that are durable and independent of our knowledge or beliefs about them. There exists a reality beyond our theories and concepts of it. Contrary to positivism, yours truly would as a critical realist argue that the main task of science is not to detect event-regularities between observed facts, but rather to identify and explain the underlying...

How banks create money .[embedded content]