Tag Archives: modeling

A key difficulty here is that, even though interactions are clearly all over the place, they’re hard to estimate. Remember, you need 16 times the sample size to estimate an interaction than to estimate a main effect. So, along with accepting the importance of interactions, we also have to accept inevitable uncertainty in their estimation. We have to move away from the idea that a statistical analysis will give us effective certainty for the things we care about. "Representative agents" are...

Over the twenty years that I have been pursuing an Islamic approach — focusing on the production of USEFUL knowledge, I have managed to heal all three of these divides. This happens naturally, when you focus on solution of real world problems. You automatically need to combine information coming from many different specialization areas. You need to use reasoning and also intuition. You also need to use both theory and its applications to the real world experiences. This leads to substantial...

On the practical side of philosophy of science. Adding nuance to Karl Popper on falsification. Further argument for the view that theories are useful but not "true." This may seem to contradict the realist view that theories are general descriptions of causal relationships. But I don't think that this is what is is implied. Rather, useful theories can be viewed as fitting the data because they reveal underlying structures that are not observed directly but only indirectly.  There is a...

Brief review of Scott Page, The Model Thinker: What You Need to Know to Make Data Work for You.Understanding SocietyModeling the socialDaniel Little | Chancellor of the University of Michigan-Dearborn, Professor of Philosophy at UM-Dearborn and Professor of Sociology at UM-Ann Arbor

I've known writers who have the essay almost fully formed in their mind, and it just pours out on to the page. It's happened for me a few times. But most writing for me, and I suspect for others, starts from a place of less clarity. There's an idea, to be sure, and some support for the idea. But as you try to put the ideas into concrete words, you become aware of a lack of precision in what you are saying, of a failure to capture what you really mean to say, of holes and inconsistencies in...

Tyler Cowen comments on a paper, and Barkley Rosser, who is not an author of the paper but is interested in the issues, responds in the comments. (Ignore the trolls in the comments.) I agree with Barkley Rosser. Social phenomena are difficult to measure and subjectivity greatly complicates this. However, it doesn't invalidate all models any more than similar issues invalidate modeling in economics. Where problems arise lies not so much in modeling and modeling decisions as in...

Financial economics. e.g., EMH and CAPM.Stumbling and MumblingProgress in economicsChris Dillow | Investors Chronicle

Hayek, Coase and uncertainty. In any case I find it fascinating that the two, Hayek and Coase, both in their own way, brought the impact of uncertainty to the fore in the same year. It’s a shame that economics has never fully embraced, nor realized, the full richness of their ideas. Neither author was willing to step into the world that they clearly understood existed. Hayek was right about universal central planning: it is an impossibility. He was wrong to assert that this implied...

You might find this of interest. As a bonus, it explains some fundamental principles of mathematical modeling. Hierarchy appears to be an inescapable feature of animal, including human, societies. There are dominants and subordinates, bosses and employees, rulers and subjects, and an individual’s position in the social hierarchy to a large degree determines fundamental aspects of his or her life, including one’s health, access to resources, and influence in society. From the individual’s...

The title is snark. The post is actually about modeling behavior and its pitfalls and shortcomings. Short and worthwhile.TruthdigVladimir Putin: Computer Genius? Andrew Cockburn