Lars P. Syll

Rational expectations — knowing what you see can’t be there …  [embedded content]

Top 10 RCT critiques •Basu, Kaushik (2014) Randomisation, Causality and the Role of Reasoned Intuition •Cartwright, Nancy  (2010) What are randomised controlled trials good for? •Cartwright, Nancy & Hardie, Jeremy (2012) Evidence-Based Policy: A Practical Guide to Doing It Better •Deaton, Angus (2009 ) Instruments of development: Randomization in the tropics, and the search for the elusive keys to economic development •Deaton, Angus &...

Truth — not unbiasedness — is what we should aim for Econometricians usually aim for unbiased estimates. And in econometrics textbooks you learn that if it’s not BLUE, it’s not good. But if you really think about it, there is no real unbiased estimates. As soon as you weigh in the fact that in all econometric applications you always get your ‘unbiased’ estimates based on non-ideal randomized samples, measurement errors, non-additive and non-linear...

Post-model-selection inference problems (wonkish) It has long been recognized by some that when any parameter estimates are discarded, the sampling distribution of the remaining parameter estimates can be distorted … For example, suppose the model a researcher selects depends on the day of the week. On Mondays it’s model A, on Tuesdays it’s model B, and so onup to seven different models on seven different days. Each model, therefore,is the “final” model with...

The problem of nonexcitation (wonkish) Modern econometrics is fundamentally based on assuming — usually without any explicit justification — that we can gain causal knowledge by considering independent variables that may have an impact on the variation of a dependent variable. This is however, far from self-evident. Often the fundamental causes are constant forces that are not amenable to the kind of analysis econometrics supplies us with. As Stanley...

Swedish-Eritrean journalist and writer Dawit Isaak has been held in Eritrean prison for 15 years without trial. He is the only Swedish citizen held as a prisoner of conscience. [embedded content]

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If contributions made by statisticians to the understanding of causation are to be taken over with advantage in any specific field of inquiry, then what is crucial is that the right relationship should exist between statistical and subject-matter concerns … Where the ultimate aim of research is not prediction per se but rather causal explanation, an idea of causation that is expressed in terms of predictive power — as, for example, ‘Granger’ causation — is likely to be found...

James Tobin explains why real business cycle theory and microfounded DSGE models are such a waste of time — thirty years before Paul Romer. Maybe one should start teaching some history of economic thought at economics departments again? Just a thought … They try to explain business cycles solely as problems of information, such as asymmetries and imperfections in the information agents have. Those assumptions are just as arbitrary as the institutional rigidities and inertia...

The best advice you will get this year Getting it right about the causal structure of a real system in front of us is often a matter of great importance. It is not appropriate to offer the authority of formalism over serious consideration of what are the best assumptions to make about the structure at hand … Where we don’t know, we don’t know. When we have to proceed with little information we should make the best evaluation we can for the case at hand —...