Re: [Fwd: nobel]

[Clifford Poirot <cpoirot@xxxxxxxxxxx>]

I think I would be inclined to agree with Paul about the utility of
econometrics as a means of empirical observation save in very limited ways.
That is not to argue against quantification per se. On the whole, I would
argue the very best analysis of the Great Depression is Kindleberger's "The
World in Depression". It is far superior to either Temin's or Friedman's
works on the Great dDepression. Kindleberger did not use one econometric
equation, while Friedman and Temin devoted great efforts to econometrics.

Schumpeter and Rostow contributed a great deal to our knowleddge of leading
sectors and industrialization. Econometricians came up with the brilliant
observation that if we hadn't built railroads, we would have to build
canals. If we hadn't developed east to west, we could have developed north
to south (which actually ignores the obstacles to development in the
southern states). Based on this incredible insight, they concluded we could
have gotten along just fine without railroads...

Post-Keynesians would do better to re-emphasize and rethink the role of
historical narrative or is the proposition that history matters to be
reduced to propositions about idempotent matrices?

-----Original Message-----
From: Sven R Larson [mailto:slarson@xxxxxxxxxxxx]
Sent: Thursday, October 10, 2002 2:06 PM
To: pkt@xxxxxxxxxxxxxxxx
Subject: Fwd: Re: [Fwd: nobel]



paul davidson wrote:
> Don't confuse econometric research with mere observations! Most
econometric
> research MISUSES the statistical tools -- since the conditions necessary
> for tests of significance, etc are not available for most economic
> data.  Poor statistical analysis is bad statistics -- or as the book I
read
> when I was a biochemist years ago stated  in its title "How to Lie With
> Statistics".

Honestly, Paul, anyone with 300-level economics, and particular with
graduate training, knows this. You're breaking through open doors.
Even my son, 8 years old, knows that it makes no sense to say that if
your right hand is in boiling water and your left hand is on ice you
are on average doing pretty OK. So let's skip that and talk about how
we can actually approach the world beyond the armchair. I have a
review of Truman Bewley's book "Why Wages Don't Fall During a
Recession" in the last ROPE. Read it, then read the book. Bewley shows
that using the right kind of empirical tools you CAN grasp the world
in a way that suits a Post Keynesian perspective.

> Crude statistical analysis is bad statistics and deserves to be recognized
> as such.  Observatiuon and statistical analysis is not the same.  As a
> biochemist I was always warned that a column of data that others collected
> was merely a column of numbers-- and not information about the real world
[
> [as those who have been following the recent several decade long
> disclosures of fabrication of  lab book observations by eminent  and up
> coming scientists has revealed.  and like Enron that is just the tip of
the
> iceberg in the natural science-- and econometrics starts even off worse,
> since the lab book observations are fabricated by someone else who the
> analyst typically does not know -- and does not communicate with.

Are you saying qualitative evidence is superior to quantitative? I
don't think so, but you don't seem to have anything good to say about
quantitative empirical methods whatsoever.

/srl

--
Dr. Sven R Larson
Department of Economics
Skidmore College
815, North Broadway
Saratoga Springs, NY 12866
(518) 580-5278