Lars P. Syll

Modelling an uncertain world In a very personal discussion of uncertainty and the hopelessness of accurately modeling what will happen in the real world, Nobel laureate Kenneth Arrow – in “I Know a Hawk From a Handsaw,” in M. Szenberg, ed., Eminent Economists: Their Life Philosophies, Cambridge University Press (1992) – writes: It is my view that most individuals underestimate the uncertainty of the world. This is almost as true of economists and other...

Il n’y a pas de vérité économique  [embedded content]

 [embedded content]

Wienmodellen — så löser vi bostadsbristen [embedded content] Yours truly har alltid gillat Wien sen han läste tyska där år 1980. Jag längtar med jämna mellanrum tillbaka (var där för några år sedan och föreläste vid stadens två stora universitet). Och det blir ju inte sämre när det nu visar sig att staden — till skillnad från t ex Stockholm — på allvar försöker göra något åt bostadseländet. (h/t Kjell Nilsson)

Econometric beasts of bias In an article posted earlier on this blog — What are the key assumptions of linear regression models? — yours truly tried to argue that since econometrics doesn’t content itself with only making ‘optimal’ predictions,” but also aspires to explain things in terms of causes and effects, econometricians need loads of assumptions — and that most important of these are additivity and linearity. Let me take the opportunity to elaborate...

 [embedded content] The economic implications of gender discrimination are most serious. To deny women is to deprive a country of labor​ and talent, but — even worse — to undermine the drive to achievement of boys and men. One cannot rear young people in such wise that half of them think themselves superior by biology, without dulling ambition and devaluing accomplishment … To be sure, any society will have its achievers no matter what, if only because it has its own division...

Econometrics — the path from cause to effect [embedded content] In their book — Mastering ‘Metrics: The Path from Cause to Effect — Joshua D. Angrist and Jörn-Steffen Pischke write: Our first line of attack on the causality problem is a randomized experiment, often called a randomized trial. In a randomized trial, researchers change the causal variables of interest … for a group selected using something like a coin toss. By changing circumstances randomly,...

Böckerna jag alltid bär med mig I tre decennier förde Roland Svensson dagböcker där han i ord och bild tecknade ner händelser och tankar från Stockholms skärgård. Dagböckerna från 1949 och 1950 — i facsimile — köpte jag på Roland Svensson-utställningen på Waldemars udde år 2011. Tack Roland för denna kulturskatt!

Random walks (student stuff)  [embedded content]

This is my take on Rogoff’s “Modern Monetary Nonsense” Rogoff: “A number of leading US progressives, who may well be in power after the 2020 elections, advocate using the Fed’s balance sheet as a cash cow to fund expansive new social programs, especially in view of current low inflation and interest rates.” Rogoff’s use of the expression “as a cash cow to fund” ignores the fact that the Fed is already the “cash cow” that makes all economy’s payments possible. The Fed lends to...