I’m happy you mentioned game theory since it has also a naïve econ type issue. The prisoner’s dilemma is a bad example of game theory since the game is only played one time. One time a bunch of guys decided to do a game theory tournament where they made bots play tons of games against each other and see which one does best. To the researcher’s surprise the sample “Tit for tat” approach was the best, it just did whatever the opponent did last.
And of course people sometimes conflate Economics with hard science when it’s a social science. We can’t just make an alternate universe and run an experiment to see which policy creates the most GDP growth or whatever people are measuring.
Also, assuming homo economicus is an accurate representation of humans just doesn’t work, but it does make the math a lot simpler. It’s the issue with economic models is that a simple model doesn’t accurately reflect society and a complex model, although a better simulation, is a lot harder to analyse and draw conclusions from. The superhuman homo economicus can assign monetary value to everything, is aware of all choices and can rank them accurately according to each choices utility. Nobody does that, everyone makes a shit purchase every now and then.
Economics is great but it’s soooo incredibly oversimplified to the point where people are making claims that are opposite to what economics is actually teaching.
Btw, have you checked out Money & Macro on YouTube/Nebula? It’s a channel from a professor in economics and he’s really good at getting into the economic nuances of current events.
Apologies for my pointed tone, but the demotion of Economics as a lesser science due to lack of controlled experiments is a pet peeve of mine.
Economists do run experiments, or work very hard to try to hard quasi-like experiment designs.
Angrist Krueger won a Nobel for showing that increasing minimum wage actually increases overall employment, by utilising data in border towns in NJ/NY where the differing laws across state lines constituted a natural experiment.
Amy Finkelstein won a Bates medal (basically a baby Nobel) for her work in health policy, which involves being the lead investigator in coordinating the large scale Oregon Health Insurance Experiment that randomly assigned participants with health insurance.
It’s even possible, though much more difficult, on the macro side. Scholars such as Emi Nakamura look at high-frequency data of bond markets to see how markets and the economy respond to the actions of the Federal Reserve.
More recently, “General Equilibrium Effects of Cash Transfers: Experimental Evidence From Kenya” won the Frisch medal for conducting randomised, large scale cash transfers to low income, isolated rural communities, where due to the isolation, could make it arguably similar to UBI.
Actually good Econ channels:
Money and Macro
TLDR News (though their non UK/global coverage is a bit sus)
National Bureau of Economic Research (live streams economic research conferences, wouldn’t recommend actually watching but you can get a feel for what Econ actually does)
Unlearning Economics (maybe only 70% correct, but very engaging and not as “mainstream”)
Nice, let’s I’m going to nerd out a bit more.
I’m happy you mentioned game theory since it has also a naïve econ type issue. The prisoner’s dilemma is a bad example of game theory since the game is only played one time. One time a bunch of guys decided to do a game theory tournament where they made bots play tons of games against each other and see which one does best. To the researcher’s surprise the sample “Tit for tat” approach was the best, it just did whatever the opponent did last.
And of course people sometimes conflate Economics with hard science when it’s a social science. We can’t just make an alternate universe and run an experiment to see which policy creates the most GDP growth or whatever people are measuring.
Also, assuming homo economicus is an accurate representation of humans just doesn’t work, but it does make the math a lot simpler. It’s the issue with economic models is that a simple model doesn’t accurately reflect society and a complex model, although a better simulation, is a lot harder to analyse and draw conclusions from. The superhuman homo economicus can assign monetary value to everything, is aware of all choices and can rank them accurately according to each choices utility. Nobody does that, everyone makes a shit purchase every now and then.
Economics is great but it’s soooo incredibly oversimplified to the point where people are making claims that are opposite to what economics is actually teaching.
Btw, have you checked out Money & Macro on YouTube/Nebula? It’s a channel from a professor in economics and he’s really good at getting into the economic nuances of current events.
Apologies for my pointed tone, but the demotion of Economics as a lesser science due to lack of controlled experiments is a pet peeve of mine.
Economists do run experiments, or work very hard to try to hard quasi-like experiment designs.
Angrist Krueger won a Nobel for showing that increasing minimum wage actually increases overall employment, by utilising data in border towns in NJ/NY where the differing laws across state lines constituted a natural experiment.
Amy Finkelstein won a Bates medal (basically a baby Nobel) for her work in health policy, which involves being the lead investigator in coordinating the large scale Oregon Health Insurance Experiment that randomly assigned participants with health insurance.
It’s even possible, though much more difficult, on the macro side. Scholars such as Emi Nakamura look at high-frequency data of bond markets to see how markets and the economy respond to the actions of the Federal Reserve.
More recently, “General Equilibrium Effects of Cash Transfers: Experimental Evidence From Kenya” won the Frisch medal for conducting randomised, large scale cash transfers to low income, isolated rural communities, where due to the isolation, could make it arguably similar to UBI.
Actually good Econ channels:
Money and Macro
TLDR News (though their non UK/global coverage is a bit sus)
National Bureau of Economic Research (live streams economic research conferences, wouldn’t recommend actually watching but you can get a feel for what Econ actually does)
Unlearning Economics (maybe only 70% correct, but very engaging and not as “mainstream”)
Shit tier channels (at least for Econ):
Economics Explained
Kurzgesagt
Infographics Show
Econ dork detected, deploying Econ joke:
“Hey there Mr. Powell, how’s your soda?”
“… My beveridge is unfortunately rather flat…”