Lars P. Syll

What is truth in economics? In my view, scientific theories are not to be considered ‘true’ or ‘false.’ In constructing such a theory, we are not trying to get at the truth, or even to approximate to it: rather, we are trying to organize our thoughts and observations in a useful manner. Robert Aumann What a handy view of science. How reassuring for all of you who have always thought that believing in the tooth fairy make you understand what happens to...

The perils of calling your pet cat a dog … 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 — most important of these are additivity and linearity. Important, simply because if they are not true, your model is invalid and descriptively incorrect.  And when the model is wrong — well, then it’s wrong. The assumption of...

Svensk universitetsutbildning i fritt fall (II) Jag sprang nyligen på en sammanställning av genusdoktorsavhandlingar från 2014. Många godbitar. Men en av dem var särskilt anmärkningsvärd, nämligen nummer 19 i uppräkningen. Det handlar om doktorsavhandlingen “Rum, rytm och resande” från Linköpings universitet (pdf). Sammanställningen sammanfattar: “Avhandlingen undersöker järnvägstationer som fysiska platser och sociala rum ur könsperspektiv. Kimstad...

What it takes to make economics a real science What is science? One brief definition runs: “A systematic knowledge of the physical or material world.” Most definitions emphasize the two elements in this definition: (1) “systematic knowledge” about (2) the real world. Without pushing this definitional question to its metaphysical limits, I merely want to suggest that if economics is to be a science, it must not only develop analytical tools but must also...

Svensk universitetsutbildning i fritt fall Kvantiteten har länge fått gå före kvaliteten i högskolan. Varken den förkastade budgeten eller den som riksdagen antog ändrar den bilden. Samtidigt som urholkningen av högskolan fortsätter finns det ett politiskt tryck på fler utbildningsplatser. Men ensidiga satsningar på fler platser gynnar varken samhället, högskolorna eller de studenter som får utbildning av tvivelaktig kvalitet. I nuläget måste högskolans...

Statistical significance tests do not validate models The word ‘significant’ has a special place in the world of statistics, thanks to a test that researchers use to avoid jumping to conclusions from too little data. Suppose a researcher has what looks like an exciting result: She gave 30 kids a new kind of lunch, and they all got better grades than a control group that didn’t get the lunch. Before concluding that the lunch helped, she must ask the...

Why p-values cannot be taken at face value A researcher is interested in differences between Democrats and Republicans in how they perform in a short mathematics test when it is expressed in two different contexts, either involving health care or the military. The research hypothesis is that context matters, and one would expect Democrats to do better in the health- care context and Republicans in the military context … At this point there is a huge...

Mainstream economists dissing people that want to rethink economics There’s a lot of commenting on the blog now, after yours truly put up a post where Cambridge economist Pontus Rendahl in an interview compared heterodox economics to ‘creationism’ and ‘alternative medicine,’ and totally dissed students that want to see the economics curriculum moving in a more pluralist direction. Sad to say, Rendahl is not the only mainstream economist having monumental...

Econometrics and the bridge between model and reality Trygve Haavelmo, the “father” of modern probabilistic econometrics, wrote that he and other econometricians could not “build a complete bridge between our models and reality” by logical operations alone, but finally had to make “a non-logical jump” [‘Statistical testing of business-cycle theories,’ 1943:15]. A part of that jump consisted in that econometricians “like to believe … that the various a...

On the proper use of mathematics in economics One must, of course, beware of expecting from this method more than it can give. Out of the crucible of calculation comes not an atom more truth than was put in. The assumptions being hypothetical, the results obviously cannot claim more than a vey limited validity. The mathematical expression ought to facilitate the argument, clarify the results, and so guard against possible faults of reasoning — that is all....