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I'd argue that Economics is not a science because it has no models that can predict anything. Economists today are just modern day Oracles/Seers that use their

I'd argue that Economics is not a science because it has no models that can predict anything. Economists today are just modern day Oracles/Seers that use their equations/models in a similar manner to how a Seer would throw chicken bones to foretell the future. Because of these Economists seem to break up into factions making it more similar to religious belief IMO. You even see many Economists ignore evidence that contradicts their pet theory. I think it's dangerous to take their ideas too seriously.

jnwatson 6y ago
I'm not sure where you're coming from. Economics does indeed produce models that are predictive.
- JetSpiegel 6y ago
  Tulip prices can only go up. See also 1929, 2008, etc etc.
traek 6y ago
The link explains some practical applications of Milgrom's and Wilson's work on auction theory. Mechanism design and auction theory are definitely predictive and useful in the real world.
johnrgrace 6y ago
The current prize disproves your point.
prionassembly 6y ago
This seems to conflate predictability with determinism. The value of stock options hews very close to what Black-Scholes theory would assume. There's one loose bone: volatility. But reasonable estimates of volatility are close enough for any real applications of derivatives (i.e. hedging, not speculation). The uncovered parity equation of exchange rates has one loose bone: sovereign risk premia. If Cristina Kirschner dies and her successor starts privatizing foreign-owned capital assets, well, there goes the model. And to a smaller extent this is happening all the time. But if you had to take a decision on how local interest rates affect exchange rates, this is an excellent guide. If anything, economics is insufficiently mathematical in the treatment of what it can't determine. It's a reasonable mean field theory but should be more Bayesian about what it takes as assumption (markets will open tomorrow -- fruit and stock alike...). The assumptions are mostly fine but we should, as a general public, have a clearer picture of how fine. Then, how well is epidemiology doing this? 99% confidence intervals from March Covid models should encompass the possibility that there's almost no fomite transmission but the virus remains alive in airborne aerosols for longer distances and time. We might all have gone the Swede route, where true agglomerations were instantly shut down, or at least prevented having the WHO and the Surgeon General telling us not to wear masks.

jnwatson 6y ago

I'm not sure where you're coming from. Economics does indeed produce models that are predictive.

JetSpiegel 6y ago
Tulip prices can only go up. See also 1929, 2008, etc etc.

traek 6y ago

The link explains some practical applications of Milgrom's and Wilson's work on auction theory. Mechanism design and auction theory are definitely predictive and useful in the real world.

johnrgrace 6y ago

The current prize disproves your point.

prionassembly 6y ago

This seems to conflate predictability with determinism. The value of stock options hews very close to what Black-Scholes theory would assume. There's one loose bone: volatility. But reasonable estimates of volatility are close enough for any real applications of derivatives (i.e. hedging, not speculation). The uncovered parity equation of exchange rates has one loose bone: sovereign risk premia. If Cristina Kirschner dies and her successor starts privatizing foreign-owned capital assets, well, there goes the model. And to a smaller extent this is happening all the time. But if you had to take a decision on how local interest rates affect exchange rates, this is an excellent guide. If anything, economics is insufficiently mathematical in the treatment of what it can't determine. It's a reasonable mean field theory but should be more Bayesian about what it takes as assumption (markets will open tomorrow -- fruit and stock alike...). The assumptions are mostly fine but we should, as a general public, have a clearer picture of how fine. Then, how well is epidemiology doing this? 99% confidence intervals from March Covid models should encompass the possibility that there's almost no fomite transmission but the virus remains alive in airborne aerosols for longer distances and time. We might all have gone the Swede route, where true agglomerations were instantly shut down, or at least prevented having the WHO and the Surgeon General telling us not to wear masks.