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Of course, you can test macroeconomics with a water tank too https://en.m.wikipedia.org/wiki/MONIAC https://en.m.wikipedia.org/wiki/MONIAC
by p10jkle 6y ago
Of course, you can test macroeconomics with a water tank too
https://en.m.wikipedia.org/wiki/MONIAC https://en.m.wikipedia.org/wiki/MONIAC
- lupire 6y agoBut hydrodynamics experiments actual give correct answers, because physics empirically matches physical theory, but economics doesn't.
- astrange 6y agoThere's empirical economics now. https://www.nobelprize.org/prizes/economic-sciences/2019/summary/ https://www.nobelprize.org/prizes/economic-sciences/2019/sum... I mean, the macro men are still out there, their predictions are still always wrong, and they still refuse to admit it. But at least we're starting to not listen to them.
- sceadu 6y agoSee also: https://wiki.lspace.org/mediawiki/Glooper https://wiki.lspace.org/mediawiki/Glooper
- nroets 6y agoThat model predates important advances like Rational Expectations. Even in the 1980s the Fed under Paul Volcker tried to reign in inflation too quickly, causing a recession.
- neilwilson 6y agoIf you believe modelling that actors can see the future perfectly is an advance - which is what Rational Expectations requires. It's a fudge to try and explain why monetary policy works instantly rather than in eighteen months to two years time. However the evidence of the failure to raise inflation to 2% demonstrates that it is wrong in practice. Unsurprisingly the real world can't see the future perfectly. Which is why you need advanced automatic stabiliser systems that actually work on the real world, not just the imagination.