Lars P. Syll

On the road to hell  [embedded content]

The logic of instrumental variables (student stuff)  [embedded content]

Macroeconometrics — the science of hubris When a macroeconometrician uses regression, he or she is implicitly saying, in effect, that the third quarter of 2007 is the same as the first quarter of 1988, once all factors that might be different between those two quarters are controlled for. The idea is that the economist is conducting an intertemporal quasi-experiment. But because there is only one economic history with which to work, there is a lack of...

 [embedded content] Jättebra video. Låt oss hoppas att LO nu rejält påminner “sitt” eget parti om det gigantiska svek de utsatt sina väljare för. Historiens dom ska falla hård på ansvariga politiker — och inte minst på socialdemokratins Göran Persson, Kjell-Olof Feldt och alla andra som i deras fotspår fortsatt glatt traska patrull — som hänsynslöst och med berått mod låtit offra den en gång så stolta svenska traditionen av att försöka bygga ett jämlikt samhälle. Ett samhälle...

Selection bias and the elite school illusion  [embedded content] A great set of lectures — but I still warn my students that regression-based averages is something we have reasons to be cautious about. Suppose we want to estimate the average causal effect of a dummy variable (T) on an observed outcome variable (O). In a usual regression context one would apply an ordinary least squares estimator (OLS) in trying to get an unbiased and consistent estimate: O...

R A Fisher — the father of modern statistics (1/4)  [embedded content]

Unquantifiable risk and financial stability Meteorologists and insurers talk about the “1-in-100 year storm”. Should regulators do the same for financial crises? In this post, we argue that false confidence in people’s ability to calculate probabilities of rare events might end up worsening the crises regulators are trying to prevent … Unwarranted faith in the odds of rare events can set the stage for far worse outcomes. No matter how hard we try, we cannot...

Causality — the back-door criterion  [embedded content]

Mitt Romney — hero in times of cowardice [embedded content] And yes, I certainly know what kind of politician Romney is, but here he shows loads of personal courage, and for that, we owe him some respect.

Overcontrolling in econometrics — a wasteful practice ridden with errors The gender pay gap is a fact that, sad to say, to a non-negligible extent is the result of discrimination. And even though many women are not deliberately discriminated against, but rather self-select into lower-wage jobs, this in no way magically explains away the discrimination gap. As decades of socialization research has shown, women may be ‘structural’ victims of impersonal social...