From: John Conover <email@example.com>
Subject: Re: Why are economists reviled?
Date: 19 Aug 1999 05:20:17 -0000
John J. Weatherby writes: > > In short it like this. The old forecasting are gone. They don't predict. > Forecasting models try to predict almost everything for the next year or so. > Policy implications can be somewhat predicted. Partial solutions are > available. For instance the new growth theory has a lot to say about what > kind of returns certain policy can have. Unlike the days of Solow when his > model said X K in year t means Y K in year t+1, therefore z% amount of > growth. The Keynesian models gave no policy implications to growth. The new > growth theory does. For instance taking product creation or R&D an accurate > estimation for the return of X government dollars in basic research can > made. This doesn't mean the New Growth models predict the growth rate for > the next period, well not all of them. The models predict what effects > increased education, research, worker training programs, etc. may have. A > very much better result than the old forecasting models that said we can > predict X% growth but don't ask me why. > Oh, perturbation theory. The good news is-if the system is sufficiently complex-that it will produce desired results somewhat over 50% of the time. The bad news is that it won't somewhat less than 50% of the time (ie., Pareto-Levy distribution.). Which, would be would be decided by lottery. The question is, is an economy a sufficiently complex system? Anyone measured it? John BTW, a good way to verify it would be to apply some means to achieve a desired economic end, but do so at different time scales, measuring the successes and failures, and assembling them into a frequency distribution. If the distribution doesn't change WRT time scales, it is sufficiently complex. I'll bet it converges into a Pareto-Levy distribution, in only a very few iterations, (like two, to assert its bell shaped characteristic.) -- John Conover, firstname.lastname@example.org, http://www.johncon.com/