Why we use mathematics in economics

Economics Nobel winner Jean Tirole put it succinctly as follows:

In a mostly auto-generated translation via Twitter’s web interface, this says “[we] use mathematics not because we’re smart but because we’re not smart”.

I agree wholeheartedly. Using mathematics in our work in economics (and in so many other areas of research) allows us to stand on the shoulders of giants and use their smarts. It’s on us to make good use of this powerful tool, honed over the centuries by so many brilliant people. Criticisms of using mathematics in economics are pointless; criticisms of using mathematics badly in economics are valuable.

Uplifting view

I took a healing walk in the Morris Arboretum with my wife and a friend. I’ve been stressing since the day after the election about the future of the country, and indeed of the planet, but walking in nature was a healing experience, as always.

For anyone who wonders why I emphasized the environment

I just wrote a post with emphasis on the environment, not necessarily what people might have expected on the day after the momentous US election. Here is why:
http://www.vox.com/2016/11/9/13571318/donald-trump-disaster-climate
I have no children of my own but I do love dearly a number of young people and generally feel for the plight of the young and the unborn to whom we leave this mess. Quite apart from the economic disaster that this election result is likely to produce, it does set back the recent world-wide progress on the environment, small and halting as it has been, and I find this casts a huge dark cloud over my thoughts.

Thoughts on the morning after

Hatred must always be fought and vanquished. We have extra work to do now to keep vanquishing hatred, to stand by vulnerable people, to stand for our rights and freedoms, to protect the environment from the depredations of humanity.

Taking a global view, I worry that Earth’s ecosystem will purge homo “sapiens” if said species continues in its destructive ways, with strife overtaking cooperation, with walls being built instead of bridges, with mutual distrust raising the chance of hideous weapons being used again.

This election is another indication, among many in the last decades, that our species is not managing its affairs in its own long-term benefit. Thinking people, we have the duty to think of paths that will take us to a better place and to do what we can to steer humanity in its direction, with malice toward none. It’s a tall order, but I refuse to accept it is an impossible aspiration.

Or we can leave a literally scorched Earth to thriving populations of rats and cockroaches, species that seem to have awesome staying power in a changing environment. That seems eminently feasible, and inevitable if we do not actively fight the good fight.

(As posted to my Facebook timeline this morning, in reaction to the US election result.)

A great way of being transparent in presenting empirical research

Do read carefully the text included in the image that comes with this tweet. It contains practices adopted in a recent research paper that make the reporting of statistical analyses substantially more transparent than commonly seen.

Paul Romer on the state of macroeconomics

Paul Romer, from whom I had the privilege to receive instruction in the first semester of my PhD studies, and who has gone on to great things, sees trouble in the way mainstream macroeconomics is done. He has been writing about this in various ways for a while, notably when he introduced the notion of “mathiness” (search for the term on this very blog to see what I had to say about it). His diagnosis about the trouble with macroeconomics, which is quite convincing to me, is here.