tag:blogger.com,1999:blog-11906042.post2532006083006259880..comments2024-03-22T11:55:50.335+13:00Comments on Not PC: The Truth About Economic ForecastingPeter Cresswellhttp://www.blogger.com/profile/10699845031503699181noreply@blogger.comBlogger4125tag:blogger.com,1999:blog-11906042.post-79301753847410633492013-05-15T11:01:12.787+12:002013-05-15T11:01:12.787+12:00Sorry, but when we think about how millions of ind...Sorry, but when we think about how millions of individuals will respond to a set of circumstances, we're making economic predictions.<br /><br />Humans are complex, but (especially on aggregate, ie, in an economy), predictable, even when they act irrationally.<br /><br />I would suggest that the failure of economic predictions lies in this irrationality for two reasons:<br />- economic models usually assume people are impossibly rational<br />- economists, as humans, are sometimes irrational, so they are liable to let what they'd like to be true get in the way of the evidence. This is true on the left and the rightSamnoreply@blogger.comtag:blogger.com,1999:blog-11906042.post-12252385593503804862013-05-12T12:38:34.428+12:002013-05-12T12:38:34.428+12:00Sam, the economy is not a real existant entity. Ea...Sam, the economy is not a real existant entity. Each person you ask will possess a different delusion of what it is. On the other and individuals are real. You can touch them. Deal with the real. To answer your question about tax you ought to direct your atention away from an imaginary collective and deal with what exists. Deal with individuals. Ask yourself whether it would help an individual to have more of his property stolen from him or less or even noen at all. The answer will certainly let you know whether taxing is a good thing to do or not. <br /><br />Amit Cim Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-11906042.post-36854887332376600842013-05-10T19:50:09.452+12:002013-05-10T19:50:09.452+12:00If predictions are impossible in economics, how ca...If predictions are impossible in economics, how can you justify having any opinion on economic policy? How can you defend your belief that, for example, tax increases will hurt the economy, without making economic predictions?Samnoreply@blogger.comtag:blogger.com,1999:blog-11906042.post-90759737498855498072013-05-09T19:54:10.847+12:002013-05-09T19:54:10.847+12:00"In fact, by presenting itself as the only sc..."In fact, by presenting itself as the only scientific dimension of economics, forecasting has helped discredit the whole discipline, and fuelled an exodus of economists from the more mundane academic world to the arena of state control and coercion, to the detriment of every American."<br /><br />Two points 1) very few economists are involved in forecasting. The majority of economists have nothing to do with it and want nothing to do with it. 2) private forecasters stay in business only because someone is buying their forecasts. There are entrepreneurs out there buying forecasts. One assumes this is because they find the information they get from these forecasts worthwhile.Paul Walkerhttps://www.blogger.com/profile/13731003529546075700noreply@blogger.com