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description=15 posts published by Lars Syll during January 2016;

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ion analysis posted on the edge website a week ago watch the lecture here now i think that what nisbett says is right as far as it goes although it would certainly have strengthened nisbett s argumentation if he had elaborated more on the methodological question around causality or at least had given some mathematical statistical econometric references unfortunately his alternative approach is not more convincing than regression analysis as so many other contemporary social scientists today nisbett seems to think that randomization may solve the empirical problem by randomizing we are getting different populations that are homogeneous in regards to all variables except the one we think is a genuine cause in this way we are supposed to be able to not have to actually know what all these other factors are if you succeed in performing an ideal randomization with different treatment groups and control groups that is attainable but it presupposes that you really have been able to establish and not just assume that the probability of all other causes but the putative have the same probability distribution in the treatment and control groups and that the probability of assignment to treatment or control groups are independent of all other possible causal variables unfortunately real experiments and real randomizations seldom or never achieve this so yes we may do without knowing all causes but it takes ideal experiments and ideal randomizations to do that not real ones as i have argued e g here that means that in practice we do have to have sufficient background knowledge to deduce causal knowledge without old knowledge we can t get new knowledge and no causes in no causes out nisbett is well worth reading and listening to but on the issue of the shortcomings of multiple regression analysis no one sums it up better than eminent mathematical statistician david freedman in his statistical models and causal inference if the assumptions of a model are not derived from theory and if predictions are not tested against reality then deductions from the model must be quite shaky however without the model the data cannot be used to answer the research question in my view regression models are not a particularly good way of doing empirical work in the social sciences today because the technique depends on knowledge that we do not have investigators who use the technique are not paying adequate attention to the connection if any between the models and the phenomena they are studying their conclusions may be valid for the computer code they have created but the claims are hard to transfer from that microcosm to the larger world regression models often seem to be used to compensate for problems in measurement data collection and study design by the time the models are deployed the scientific position is nearly hopeless reliance on models in such cases is panglossian given the limits to present knowledge i doubt that models can be rescued by technical fixes arguments about the theoretical merit of regression or the asymptotic behavior of specification tests for picking one version of a model over another seem like the arguments about how to build desalination plants with cold fusion and the energy source the concept may be admirable the technical details may be fascinating but thirsty people should look elsewhere causal inference from observational data presents may difficulties especially when underlying mechanisms are poorly understood there is a natural desire to substitute intellectual capital for labor and an equally natural preference for system and rigor over methods that seem more haphazard these are possible explanations for the current popularity of statistical models indeed far reaching claims have been made for the superiority of a quantitative template that depends on modeling by those who manage to ignore the far reaching assumptions behind the models however the assumptions often turn out to be unsupported by the data if so the rigor of advanced quantitative methods is a matter of appearance rather than substance the force from above cleaning my soul 28 jan 2016 at 09 30 posted in varia comments off on the force from above cleaning my soul krugman a vichy left coward 27 jan 2016 at 23 53 posted in politics society comments off on krugman a vichy left coward paul krugman s recent posts have been most peculiar several have looked uncomfortably like special pleading for political figures he likes notably hillary clinton he has in my judgement stooped rather far down in attacking people well below him in the public relations food chain perhaps the most egregious and clearest cut case is his refusal to address the substance of a completely legitimate well documented article by david dayen outing krugman and to a lesser degree his fellow traveler mike konczal in abjectly misrepresenting sanders financial reform proposals the krugman that was early to stand up to the iraq war who was incisive before and during the crisis has been very much in absence since obama took office it s hard to understand the loss of intellectual independence that may not make krugman any worse than other democratic party apparatchiks but he continues to believe he is other than that and the lashing out at dayen looks like a wounded denial of his current role krugman and konczal need to be seen as what they are part of the vichy left brand cover for the democratic party messaging apparatus krugman sadly has chosen to diminish himself for a not very worthy cause yves smith naked capitalism share on facebook opens in new window facebook share on x opens in new window x share on bluesky opens in new window bluesky thatcher policies for dummies 27 jan 2016 at 15 47 posted in politics society comments off on thatcher policies for dummies what is post keynesian economics 27 jan 2016 at 11 05 posted in economics comments off on what is post keynesian economics deduction induction abduction 25 jan 2016 at 14 42 posted in theory of science methodology 3 comments in science and economics one could argue that there basically are three kinds of argumentation patterns schemes methods strategies available deduction premise 1 all chicago economists believe in reh premise 2 robert lucas is a chicago economist conclusion robert lucas believes in reh here we have an example of a logically valid deductive inference and following quine whenever logic is used in this essay logic refers to deductive analytical logic in a hypothetico deductive reasoning hypothetico deductive confirmation in this case we would use the conclusion to test the law like hypothesis in premise 1 according to the hypothetico deductive model a hypothesis is confirmed by evidence if the evidence is deducible from the hypothesis if robert lucas does not believe in reh we have gained some warranted reason for non acceptance of the hypothesis an obvious shortcoming here being that further information beyond that given in the explicit premises might have given another conclusion the hypothetico deductive method in case we treat the hypothesis as absolutely sure true we rather talk of an axiomatic deductive method basically means that we posit a hypothesis infer empirically testable propositions consequences from it test the propositions through observation or experiment depending on the testing results either find the hypothesis corroborated or falsified however in science we regularly use a kind of practical argumentation where there is little room for applying the restricted logical formal transformations view of validity and inference most people would probably accept the following argument as a valid reasoning even though it from a strictly logical point of view is non valid premise 1 robert lucas is a chicago economist premise 2 the recorded proportion of keynesian chicago economists is zero conclusion so certainly robert lucas is not a keynesian economist how come well i guess one reason is that in science contrary to what you find in most logic text books not very many argumentations are settled by showing that all xs are ys in scientific practice we instead present other than analytical explicit warrants and backings data experience evidence theories models for our inferences as long as we can show that our deductions or inferences are justifiable and have well backed warrants our colleagues listen to us that our scientific deductions or inferences are logical non entailments simply is not a problem to think otherwise is committing the fallacy of misapplying formal analytical logic categories to areas where they are pretty much irrelevant or simply beside the point scientific arguments are not analytical arguments where validity is solely a question of formal properties scientific arguments are substantial arguments if robert lucas is a keynesian or not is nothing we can decide on formal properties of statements propositions we have to check out what the guy has actually been writing and saying to check if the hypothesis that he is a keynesian is true or not in a deductive nomological explanation also known as a covering law explanation we would try to explain why robert lucas believes in reh with the help of the two premises in this case actually giving an explanation with very little explanatory value these kinds of explanations both in their deterministic and statistic probabilistic versions rely heavily on deductive entailment from assumed to be true premises but they have preciously little to say on where these assumed to be true premises come from deductive logic of confirmation and explanation may work well given that they are used in deterministic closed models in mathematics the deductive axiomatic method has worked just fine but science is not mathematics conflating those two domains of knowledge has been one of the most fundamental mistakes made in the science of economics applying it to real world systems however immediately proves it to be excessively narrow and hopelessly irrelevant both the confirmatory and explanatory ilk of hypothetico deductive reasoning fails since there is no way you can relevantly analyze confirmation or explanation as a purely logical relation between hypothesis and evidence or between law like rules and explananda in science we argue and try to substantiate our beliefs and hypotheses with reliable evidence proportional and predicate deductive logic on the other hand is not about reliability but the validity of the conclusions given that the premises are true deduction and the inferences that goes with it is an example of explicative reasoning where the conclusions we make are already included in the premises deductive inferences are purely analytical and it is this truth preserving nature of deduction that makes it different from all other kinds of reasoning but it is also its limitation since truth in the deductive context does not refer to a real world ontology only relating propositions as true or false within a formal logic system and as an argument scheme is totally non ampliative the output of the analysis is nothing else than the input continue reading deduction induction abduction share on facebook opens in new window facebook share on x opens in new window x share on bluesky opens in new window bluesky new keynesian dsge models 24 jan 2016 at 10 28 posted in economics 2 comments in the model gali smets and wouters unemployment in an estimated new keyesian mode l 2011 there is perfect consumption insurance among the members of the household because of separability in utility this implies that consumption is equalized across all workers whether they are employed or not workers who find that they do not have to work are unemployed or out of the labor force and they have cause to rejoice as a result unemployed workers enjoy higher utility than the employed because they receive the same level of consumption but without having to work there is much evidence that in practice unemployment is not the happy experience it is for workers in the model for example chetty and looney 2006 and gruber 1997 find that us households suffer roughly a 10 percent drop in consumption when they lose their job according to couch and placzek 2010 workers displaced through mass layoffs suffer substantial and extended reductions in earnings moreover oreopoulos page and stevens 2008 present evidence that the children of displaced workers also suffer reduced earnings additional evidence that unemployed workers suffer a reduction in utility include the results of direct interviews as well as findings that unemployed workers experience poor health outcomes clark and oswald 1994 oswald 1997 and schimmack schupp and wagner 2008 describe evidence that suggests unemployment has a negative impact on a worker s self assessment of well being sullivan and von wachter 2009 report that the mortality rates of high seniority workers jump 50 100 more than would have been expected otherwise in the year after displacement cox and koo 2006 report a significant positive correlation between male suicide and unemployment in japan and the united states for additional evidence that unemployment is associated with poor health outcomes see fergusson horwood and lynskey 1997 and karsten and moser 2009 suppose the cps current population survey employee encountered one of the people designated as unemployed and asked if she were available for work what would her answer be she knows with certainty that she will not be employed in the current period privately she is delighted about this because the non employed enjoy higher utility than the employed not only is she happy about not having to work but the labor union also does not want her to work from the perspective of the union her non employment is a fundamental component of the union s strategy for promoting the welfare of its membership lawrence j christiano to me these kind of new keynesian dsge models where unemployment is portrayed as a bliss are a sign of a momentous failure to model real world unemployment it s not only adding insult to injury it s also sad gibberish that shamelessly tries to whitewash neoliberal economic policies that put people out of work all empirical sciences use simplifying or unrealistic assumptions in their modeling activities that is not the issue as long as the assumptions made are not unrealistic in the wrong way or for the wrong reasons theories are difficult to directly confront with reality economists therefore build models of their theories those models are representations that are directly examined and manipulated to indirectly say something about the target systems but models do not only face theory they also have to look to the world being able to model a credible dsge world how credible that world is when depicting unemployment as a happy experience and predicting the wage markup to increase with unemployment i leave to the reader to decide a world that somehow could be considered real or similar to the real worl...