Lars P. Syll

Models and evidence in economics Analogue-economy models may picture Galilean thought experiments or they may describe credible worlds. In either case we have a problem in taking lessons from the model to the world. The problem is the venerable one of unrealistic assumptions, exacerbated in economics by the fact that the paucity of economic principles with serious empirical content makes it difficult to do without detailed structural assumptions. But the...

President Trump talking bollocks .[embedded content] Confirms — again — what we already knew: Trump is a reckless, untruthful, outrageous, incompetent and undignified buffoon!

Keynes and Knight on uncertainty First, Knight and Keynes derive from their different philosophical worldviews distinct definitions of uncertainty. Keynes’s is a wholly epistemic uncertainty concept (see Packard and Clark, 2020), the ignorance of an actor regarding the objective and knowable (a priori) probabilities of future outcomes. Such probabilities are discoverable by learning the underlying ‘probability-relations’ between causes and effects....

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Solving a simple DP problem (student stuff) .[embedded content] In case you want to solve the problem yourself, here’s a Python script yours truly made (assuming the utility function is of the natural log kind and with some explicit numerical parameterization): import numpy as np import matplotlib.pyplot as plt # Parameters beta = 0.9 # Discount factor r = 0.1 # Depreciation rate T = 3 # Time horizon k0 = 4.0 # Initial capital # Production function:...

Best advice to an aspiring economist — don’t be an economist! A science that fails to reflect on its own history and neglects critical methodological and theoretical questions about its practice is a science in crisis. As early as 1991, a commission led by Anne Krueger—featuring esteemed economists such as Kenneth Arrow, Edward Leamer, and Joseph Stiglitz—highlighted a fundamental weakness in graduate economics education. Drawing from their own experiences,...

Post Keynesian authors have offered various classifications of uncertainty … A common distinction is that of epistemological versus ontological uncertainty, with the former depending on the limitations of human reasoning and the latter on the actual nature of social systems … Models of ontological uncertainty tend to hinge on the existence of information that is critical to the decision-making task. Fundamental uncertainty occurs in “situations in which at least some essential...

Who pays for Trump’s tariffs? You will! .[embedded content]

.[embedded content] Danke, guter Gott, dass es Politiker wie Heidi gibt!