7 ms·

Economics seems more like a religion than science, with how much fundamental belief and perceptions seem to influence outcomes.

by N_Lens 1y ago

HPsquared 1y ago
There are certainly a lot of apologetics.
_heimdall 1y ago
I've taken issue with economics being considered a science since my first econ class in high school. It can be very useful for quantifying and comparing the past, but there's absolutely nothing scientific about the process and no matter how much modelling is done it can't reliably predict future outcomes.
- squid_ca 1y ago
  Edit:replied to wrong post
- braiamp 1y ago
  > it can't reliably predict future outcomes. Because we do not control perception. We have to presume multiple scenarios each of have a dimension of perception. Perception always become a determinant factor.
  - _heimdall 1y ago
    Practical economics is exclusively about controlling perception. The Fed, for example, may have modelling that indicates we have a downturn coming in 6 months. Those models aren't predictive though, and the Fed announces their economic outlook and what they may do with rates in the future they are only attempting to modify public perception and nudge behavior to make the future they actually want happen; it has nothing to do with predicting where the economy will be.
- seunosewa 1y ago
  Economics can be practised as a science or not, depending on the individual. Austrian economics, for example, is more of a religion while mainstream economics is more scientific. Economics is a science of human behaviour, which is not exact. Economic models are like weather models. They cannot be exact because what they are modelling (weather, human behaviour) is incredibly complicated with millions of parameters. Science is about observing something, forming a hypothesis about why it is that way, and then testing the hypothesis to determine whether it is correct. Many Economics researchers do all of the above, so they are scientists.
  - _heimdall 1y ago
    Totally agree that economists observe behavior and crest hypothesise, and model what might happen. That doesn't make it science though, especially when they can't really run any type of controlled studies that support the results and hypothesise claimed.
    - disgruntledphd2 1y ago
      > when they can't really run any type of controlled studies In that case, is geology a science? I too am sceptical about economics (mostly macro, the micro stuff is fine) but there are lots of places where you can't run experiments and some of them are science.
      - seunosewa 1y ago
        Evolutionary biology is another case where direct experiments don't work for the most part. Even in physics, Einstein's theories had to be supported by things like astronomical observations.
        _heimdall 1y ago
        This touches on another area I view as wholely unscientific - quantum physics. The most fundamental hypothesis of the field is untestable by design. We will never know if quantum state exists or if probability clouds collapse upon observation because by that very principle we will never know the state prior to observing it.
- deleted 1y ago
  [deleted]
- throw0101c 1y ago
  > […] and no matter how much modelling is done it can't reliably predict future outcomes. A physicists once remarked that his job would been much harder if particles had free will. But that is exact economists have to do: predict what humans will do. There is an entire sub-field of study on the non-rationality of people and how it feeds into how that effects money, finance, and economies: * https://en.wikipedia.org/wiki/Behavioral_economics https://en.wikipedia.org/wiki/Behavioral_economics But there have been instances of models working. When QE started a group of folks made predictions: > We believe the Federal Reserve’s large-scale asset purchase plan (so-called “quantitative easing”) should be reconsidered and discontinued. We do not believe such a plan is necessary or advisable under current circumstances. The planned asset purchases risk currency debasement and inflation, and we do not think they will achieve the Fed’s objective of promoting employment. * https://www.hoover.org/research/open-letter-ben-bernanke https://www.hoover.org/research/open-letter-ben-bernanke Another group of folks (often called "Keynesian") made different predictions based on their model(s) / understanding of how things work.. One turned out correct and other incorrect in their predictions. See also predictions about "tax cuts pay for themselves": * https://en.wikipedia.org/wiki/Tax_Cuts_and_Jobs_Act https://en.wikipedia.org/wiki/Tax_Cuts_and_Jobs_Act * https://en.wikipedia.org/wiki/Kansas_experiment https://en.wikipedia.org/wiki/Kansas_experiment The fact that people ignore the results of the experiments is not a failing of the academic field.
  - _heimdall 1y ago
    > But that is exact economists have to do: predict what humans will do Economists have agency. They don't have to predict what humans will do. They believe they can predict it, attempt to make their predictions, then claim that's what will happen. That works in reverse as well, attempting to predict why humans did what they did in the past and then attempt to attribute those predictions as an explanation of quantified economic indicators. In both case, past behavior and future behavior, their predictions are untestable. How is that scientific?
    - throw0101c 1y ago
      > Economists have agency. They don't have to predict what humans will do. They believe they can predict it, attempt to make their predictions, then claim that's what will happen. Economists study the economy which is made of… a bunch of humans doing stuff with money. > In both case, past behavior and future behavior, their predictions are untestable. How is that scientific? What is this not testable about: > The planned asset purchases risk currency debasement and inflation […] * https://blogs.wsj.com/economics/2010/11/15/open-letter-to-ben-bernanke/ https://blogs.wsj.com/economics/2010/11/15/open-letter-to-be... * https://www.hoover.org/research/open-letter-ben-bernanke https://www.hoover.org/research/open-letter-ben-bernanke Was there (USD) currency debasement? Was there US inflation? No? The predictions were wrong. The same day it was published (in the WSJ) there were critiques about it, e.g.: * https://archive.nytimes.com/krugman.blogs.nytimes.com/2010/11/15/liquidationists-of-the-world-unite/ https://archive.nytimes.com/krugman.blogs.nytimes.com/2010/1... When QE2 went forward and was about to stop there were many predictions (generally involving piles of money), some of which were accurate and others less so: * https://archive.nytimes.com/krugman.blogs.nytimes.com/2011/04/19/stocks-flows-and-pimco-wonkish/ https://archive.nytimes.com/krugman.blogs.nytimes.com/2011/0... * https://archive.nytimes.com/krugman.blogs.nytimes.com/2011/06/10/the-decline-of-pimco-macro/ https://archive.nytimes.com/krugman.blogs.nytimes.com/2011/0... * https://equitablegrowth.org/pimco-lose-lots-money-influence-people-honest-broker-week-october-10-2014/ https://equitablegrowth.org/pimco-lose-lots-money-influence-... How are / were these "untestable"? People in finance make predictions about what policies will do and where they will take the economy on a daily basis: * https://en.wikipedia.org/wiki/Futures_exchange https://en.wikipedia.org/wiki/Futures_exchange * https://en.wikipedia.org/wiki/Option_(finance) https://en.wikipedia.org/wiki/Option_(finance) Do you have a model that tries to explain what tariffs with do to the USD? You can make a prediction and win/lose a lot of money buy shorting/longing the dollar.
- Workaccount2 1y ago
  >there's absolutely nothing scientific about the process and no matter how much modelling is done it can't reliably predict future outcomes. I doubt you would agree that meteorology or chemistry are "nothing scientific" despite also meeting that criteria? Inability to predict outcomes does not mean "unscientific". It usually means it models a system with a fractal inputs and chaotic outputs.
  - _heimdall 1y ago
    Any study based entirely on modelling is unscientific in my opinion. Chemistry doesn't fall into that category as far as I understand, I don't know much about meteorological research.
    - Workaccount2 1y ago
      I don't know where you get that economics is based entirely on modelling. Economic decisions happen constantly on all levels, and their effects are studied heavily. The models follow from observation, the same as they do in chemistry or meteorology. And just like those two, the models are weak compared to actual observation.
      - _heimdall 1y ago
        But you can't study the effects directly. Economic system are complex, any changes made are impossible to isolate and any changes in economic indicators have to be assumed to be related to the changes made. I argue that economic research is entirely based on modelling because the research results produced always depend on modelling and either don't include any type of control group or use a controlled study so small that the odds it accurately reflects the entire economy are low. The first I think is self explanatory, for the second I'd point to studies of UBI that are done on small populations within a larger economy that doesn't have a UBI. The results of the small group are effectively meaningless because that group has a comparative advantage against the rest of the economy, and those studies are never able to create a bubble in which the UBI population is entirely cut off from the real economy while still mimicking well enough all other systems, industries, and motivations of the real economy.
- slowmovintarget 1y ago
  Economics is a science in the sense that it is a field of study. Weather science couldn't, for a long time, accurately predict the weather, but study and model refinement progressed to the point where weather prediction is more reliable now than in the past. Economics is the science of human behavior at scale, and as such, does indeed have predictive power. It is not always reliable as there are dynamic conditions and incomplete data that make the models not always fit. That doesn't disqualify it from being a science (especially the data-oriented part of it). Economics practice falls on its face when you attempt to inject ideology, though.
bell-cot 1y ago
Yeah - but mainstream economics is far more a state religion than it is just-a-religion. The priesthood is superficially concerned with the welfare of the masses, theological consistency, etc. - but the actual priority is divining what words, doctrines, and predictions would best serve the interests of the wealthy and powerful, and regularly pronouncing those. And vehemently denouncing any heretics who get too interested in the actual welfare of the masses, or the track record of the priesthood's predictions, or other dirty truths. So long as you have the right mindset, being a priest of a generously supported state religion is a very cushy job.
- braiamp 1y ago
  Yeah man, we are only to serve the rich, not because we are trying to solve the problem of scarcity nor we toot about the welfare state. Stop listening to popular economists, read about the science. We've figured this out, the problem is political.
  - andrekandre 1y ago
    > the problem is political it definitely is; sometimes i think the old term "political economy" was a much more suitable term cause it doesn't neglect the political part https://en.wikipedia.org/wiki/Political_economy https://en.wikipedia.org/wiki/Political_economy
squid_ca 1y ago
Economics isn’t a science, it’s a social science
- krona 1y ago
  I think you mean economics isn't a physical science, since social science is still a branch of science.
  - giardini 1y ago
    krona says "...since social science is still a branch of science." My experience has been that most social scientists say this is true but most physical scientists say it is false.
braiamp 1y ago
And we have very rigorous models that confirm that that is true. Perception shapes the economy more than actual fundamentals, specially when predicting the future.
terminalshort 1y ago
Macroecon, yes. Micro is actually very useful and has a good amount of predictive power.
- rrsp 1y ago
  Could you recommend any good resources for learning more about microeconomics?
  - wjnc 1y ago
    The absolute classic would be Hal Varian, afaik still chief economist at Google. Still proud of working through Microeconomic Analysis. He has an introduction into micro as well. His books are so full of worthwhile thoughts. Micro introduced me to platform economics before the internet was a big thing.
elif 1y ago
Correct. Success in modern market economics is 90% about determining the future sentiment of economists.
- rapsey 1y ago
  That is not true. Markets are moved by traders not economists. Professional traders have a very skeptical view of economists, because economists are simply wrong so often about the future. Economists from the world bank and such institutions are usually on the wrong side of forecasting for instance. For instance Scott Bessent opinion: "I will take the market-based indicators over the so-called 'experts' all the time! That’s how I made my 35-year career, was listening to the market."
  - krona 1y ago
    Distal causes vs proximate causes. Sure, you need traders to move the markets, and if that's good enough for Scott Bessent, good for him.
  - elif 1y ago
    The traders are all operating within the windows established by the policy choices of economists using fake money generated by economists to satisfy their own invented metrics. And traders are not themselves predicting the future as you put it, but they are predicting the future sentiment of other traders.
  - halfcat 1y ago
    > Markets are moved by traders And traders are moved by the Federal Reserve’s interest rate decisions
stop50 1y ago
That is why there is no nobelprize for economics. Only an Nobel Memorial Prize in Economic Sciences.
logicchains 1y ago
Economic models that have strong empirically demonstrated predictive power are called finance, not economics, because any economic predictive model that actually works can be used to make money.
chneu 1y ago
Economics is kinda like weather prediction. Most people don't understand what economists are saying and they react based on what they think economists are saying. The same is true for things like rain predictions in that people don't understand what the prediction is, so when it doesn't rain people think "the weatherman is never right" when that isn't what the prediction was saying in the first place. That said, economics is a mostly bunk "science".
Workaccount2 1y ago
I cannot disagree more, having hand waved away economics for 20 years, actually learning it has totally transformed my world view into a dramatically clearer and far more functional one. The pandemic era fiscal and monetary policy was pretty much a 5x speed (because of the scale of everything) display of economics at work, and understanding all the levers while they were pulled made it clear that no, economics is not bullshit, people just really don't like what economics has to say.
- andrekandre 1y ago
  > economics is not bullshit, people just really don't like what economics has to say. you've piqued my interest, what does it say that people don't like? (i have my own ideas so im curious what others think)
  - Workaccount2 1y ago
    Lots of people want to make it a law to "have their cake" after "eating their cake". Economics tells them they are dumb, so they call economics dumb.
    - andrekandre 1y ago
      > Lots of people want to make it a law to "have their cake" after "eating their cake". any good examples? (do you mean something like bailouts or tax cuts?)
      - HDThoreaun 1y ago
        Tariffs. Economic theory tells us that tariffs are terrible. Populists want them because they think manufacturing will come back(have their cake) but the downsides are much, much worse(eat it too).
        andrekandre 1y ago
        now it clicked, appreciated ^^
adverbly 1y ago
There's some truth to this take but it's not nearly as bad as most people think. Many people look at the economy and see that it is bad and so they think the economists must be bad at their job, but in many cases people in power simply don't listen to economists. The best example of this in my opinion is land value tax. Milton Friedman is an Nobel prize winner on the libertarian side who called lvt the best tax policy. Joseph Stieglitz is a Nobel prize winner who is a socialist who also advocated for lvt. A recent survey showed something like 83% of economists saying that lvt would significantly increase growth. And yet zero countries have implemented an lvt rate that is much higher than inflation. Good and smart policies do not need to be accepted by economists to be implemented. They need to be accepted by those in power and by the general population. In my opinion, if anything we should have way more economists on the news talking about the economy than the political pundits that you typically see - not the other way around!
jesuslop 1y ago
To be smothered in debts has nothing of spiritual.
avs733 1y ago
I’ll say that when I read business and economics it often feels like it is starting from the assumption that it is right and then trying to perform the language of science until you believe them. Add to that the wild level to which economists seem to think their economics knowledge generalizes to telling other disciplines and I tend to approach with distrust.
throw0101c 1y ago
> Economics seems more like a religion than science […] Science makes falsifiable statements that are then tested (per Popper). When QE started a group of folks made predictions: > We believe the Federal Reserve’s large-scale asset purchase plan (so-called “quantitative easing”) should be reconsidered and discontinued. We do not believe such a plan is necessary or advisable under current circumstances. The planned asset purchases risk currency debasement and inflation, and we do not think they will achieve the Fed’s objective of promoting employment. * https://www.hoover.org/research/open-letter-ben-bernanke https://www.hoover.org/research/open-letter-ben-bernanke Another group of folks (often label "Keynesian") made different predictions based on their model(s) / understanding of how things work.. One turned out correct and other incorrect in their predictions. Perhaps we should follow the models that accurately predicted things. Governments / politicians run economic experiments every time there's a major policy rollout, and they do so based on what they predict will happen: * https://en.wikipedia.org/wiki/Kansas_experiment https://en.wikipedia.org/wiki/Kansas_experiment It is not the fault of the academic discipline itself if people ignore the results of the experiments for ideological reasons. RFK Jr., the current US Secretary of HHS, is ignoring all the empirical evidence about vaccines (and even germ theory): is that the fault of biology?

Economics seems more like a religion than science, with how much fundamental belief and perceptions seem to influence outcomes.

by N_Lens 1y ago

Economics seems more like a religion than science, with how much fundamental belief and perceptions seem to influence outcomes.

HPsquared 1y ago

There are certainly a lot of apologetics.

_heimdall 1y ago

I've taken issue with economics being considered a science since my first econ class in high school. It can be very useful for quantifying and comparing the past, but there's absolutely nothing scientific about the process and no matter how much modelling is done it can't reliably predict future outcomes.

squid_ca 1y ago
Edit:replied to wrong post
braiamp 1y ago
> it can't reliably predict future outcomes. Because we do not control perception. We have to presume multiple scenarios each of have a dimension of perception. Perception always become a determinant factor.
- _heimdall 1y ago
  Practical economics is exclusively about controlling perception. The Fed, for example, may have modelling that indicates we have a downturn coming in 6 months. Those models aren't predictive though, and the Fed announces their economic outlook and what they may do with rates in the future they are only attempting to modify public perception and nudge behavior to make the future they actually want happen; it has nothing to do with predicting where the economy will be.
seunosewa 1y ago
Economics can be practised as a science or not, depending on the individual. Austrian economics, for example, is more of a religion while mainstream economics is more scientific. Economics is a science of human behaviour, which is not exact. Economic models are like weather models. They cannot be exact because what they are modelling (weather, human behaviour) is incredibly complicated with millions of parameters. Science is about observing something, forming a hypothesis about why it is that way, and then testing the hypothesis to determine whether it is correct. Many Economics researchers do all of the above, so they are scientists.
- _heimdall 1y ago
  Totally agree that economists observe behavior and crest hypothesise, and model what might happen. That doesn't make it science though, especially when they can't really run any type of controlled studies that support the results and hypothesise claimed.
  - disgruntledphd2 1y ago
    > when they can't really run any type of controlled studies In that case, is geology a science? I too am sceptical about economics (mostly macro, the micro stuff is fine) but there are lots of places where you can't run experiments and some of them are science.
    - seunosewa 1y ago
      Evolutionary biology is another case where direct experiments don't work for the most part. Even in physics, Einstein's theories had to be supported by things like astronomical observations.
      - _heimdall 1y ago
        This touches on another area I view as wholely unscientific - quantum physics. The most fundamental hypothesis of the field is untestable by design. We will never know if quantum state exists or if probability clouds collapse upon observation because by that very principle we will never know the state prior to observing it.
deleted 1y ago
[deleted]
throw0101c 1y ago
> […] and no matter how much modelling is done it can't reliably predict future outcomes. A physicists once remarked that his job would been much harder if particles had free will. But that is exact economists have to do: predict what humans will do. There is an entire sub-field of study on the non-rationality of people and how it feeds into how that effects money, finance, and economies: * https://en.wikipedia.org/wiki/Behavioral_economics https://en.wikipedia.org/wiki/Behavioral_economics But there have been instances of models working. When QE started a group of folks made predictions: > We believe the Federal Reserve’s large-scale asset purchase plan (so-called “quantitative easing”) should be reconsidered and discontinued. We do not believe such a plan is necessary or advisable under current circumstances. The planned asset purchases risk currency debasement and inflation, and we do not think they will achieve the Fed’s objective of promoting employment. * https://www.hoover.org/research/open-letter-ben-bernanke https://www.hoover.org/research/open-letter-ben-bernanke Another group of folks (often called "Keynesian") made different predictions based on their model(s) / understanding of how things work.. One turned out correct and other incorrect in their predictions. See also predictions about "tax cuts pay for themselves": * https://en.wikipedia.org/wiki/Tax_Cuts_and_Jobs_Act https://en.wikipedia.org/wiki/Tax_Cuts_and_Jobs_Act * https://en.wikipedia.org/wiki/Kansas_experiment https://en.wikipedia.org/wiki/Kansas_experiment The fact that people ignore the results of the experiments is not a failing of the academic field.
- _heimdall 1y ago
  > But that is exact economists have to do: predict what humans will do Economists have agency. They don't have to predict what humans will do. They believe they can predict it, attempt to make their predictions, then claim that's what will happen. That works in reverse as well, attempting to predict why humans did what they did in the past and then attempt to attribute those predictions as an explanation of quantified economic indicators. In both case, past behavior and future behavior, their predictions are untestable. How is that scientific?
  - throw0101c 1y ago
    > Economists have agency. They don't have to predict what humans will do. They believe they can predict it, attempt to make their predictions, then claim that's what will happen. Economists study the economy which is made of… a bunch of humans doing stuff with money. > In both case, past behavior and future behavior, their predictions are untestable. How is that scientific? What is this not testable about: > The planned asset purchases risk currency debasement and inflation […] * https://blogs.wsj.com/economics/2010/11/15/open-letter-to-ben-bernanke/ https://blogs.wsj.com/economics/2010/11/15/open-letter-to-be... * https://www.hoover.org/research/open-letter-ben-bernanke https://www.hoover.org/research/open-letter-ben-bernanke Was there (USD) currency debasement? Was there US inflation? No? The predictions were wrong. The same day it was published (in the WSJ) there were critiques about it, e.g.: * https://archive.nytimes.com/krugman.blogs.nytimes.com/2010/11/15/liquidationists-of-the-world-unite/ https://archive.nytimes.com/krugman.blogs.nytimes.com/2010/1... When QE2 went forward and was about to stop there were many predictions (generally involving piles of money), some of which were accurate and others less so: * https://archive.nytimes.com/krugman.blogs.nytimes.com/2011/04/19/stocks-flows-and-pimco-wonkish/ https://archive.nytimes.com/krugman.blogs.nytimes.com/2011/0... * https://archive.nytimes.com/krugman.blogs.nytimes.com/2011/06/10/the-decline-of-pimco-macro/ https://archive.nytimes.com/krugman.blogs.nytimes.com/2011/0... * https://equitablegrowth.org/pimco-lose-lots-money-influence-people-honest-broker-week-october-10-2014/ https://equitablegrowth.org/pimco-lose-lots-money-influence-... How are / were these "untestable"? People in finance make predictions about what policies will do and where they will take the economy on a daily basis: * https://en.wikipedia.org/wiki/Futures_exchange https://en.wikipedia.org/wiki/Futures_exchange * https://en.wikipedia.org/wiki/Option_(finance) https://en.wikipedia.org/wiki/Option_(finance) Do you have a model that tries to explain what tariffs with do to the USD? You can make a prediction and win/lose a lot of money buy shorting/longing the dollar.
Workaccount2 1y ago
>there's absolutely nothing scientific about the process and no matter how much modelling is done it can't reliably predict future outcomes. I doubt you would agree that meteorology or chemistry are "nothing scientific" despite also meeting that criteria? Inability to predict outcomes does not mean "unscientific". It usually means it models a system with a fractal inputs and chaotic outputs.
- _heimdall 1y ago
  Any study based entirely on modelling is unscientific in my opinion. Chemistry doesn't fall into that category as far as I understand, I don't know much about meteorological research.
  - Workaccount2 1y ago
    I don't know where you get that economics is based entirely on modelling. Economic decisions happen constantly on all levels, and their effects are studied heavily. The models follow from observation, the same as they do in chemistry or meteorology. And just like those two, the models are weak compared to actual observation.
    - _heimdall 1y ago
      But you can't study the effects directly. Economic system are complex, any changes made are impossible to isolate and any changes in economic indicators have to be assumed to be related to the changes made. I argue that economic research is entirely based on modelling because the research results produced always depend on modelling and either don't include any type of control group or use a controlled study so small that the odds it accurately reflects the entire economy are low. The first I think is self explanatory, for the second I'd point to studies of UBI that are done on small populations within a larger economy that doesn't have a UBI. The results of the small group are effectively meaningless because that group has a comparative advantage against the rest of the economy, and those studies are never able to create a bubble in which the UBI population is entirely cut off from the real economy while still mimicking well enough all other systems, industries, and motivations of the real economy.
slowmovintarget 1y ago
Economics is a science in the sense that it is a field of study. Weather science couldn't, for a long time, accurately predict the weather, but study and model refinement progressed to the point where weather prediction is more reliable now than in the past. Economics is the science of human behavior at scale, and as such, does indeed have predictive power. It is not always reliable as there are dynamic conditions and incomplete data that make the models not always fit. That doesn't disqualify it from being a science (especially the data-oriented part of it). Economics practice falls on its face when you attempt to inject ideology, though.

bell-cot 1y ago

Yeah - but mainstream economics is far more a state religion than it is just-a-religion. The priesthood is superficially concerned with the welfare of the masses, theological consistency, etc. - but the actual priority is divining what words, doctrines, and predictions would best serve the interests of the wealthy and powerful, and regularly pronouncing those. And vehemently denouncing any heretics who get too interested in the actual welfare of the masses, or the track record of the priesthood's predictions, or other dirty truths. So long as you have the right mindset, being a priest of a generously supported state religion is a very cushy job.

braiamp 1y ago
Yeah man, we are only to serve the rich, not because we are trying to solve the problem of scarcity nor we toot about the welfare state. Stop listening to popular economists, read about the science. We've figured this out, the problem is political.
- andrekandre 1y ago
  > the problem is political it definitely is; sometimes i think the old term "political economy" was a much more suitable term cause it doesn't neglect the political part https://en.wikipedia.org/wiki/Political_economy https://en.wikipedia.org/wiki/Political_economy

squid_ca 1y ago

Economics isn’t a science, it’s a social science

krona 1y ago
I think you mean economics isn't a physical science, since social science is still a branch of science.
- giardini 1y ago
  krona says "...since social science is still a branch of science." My experience has been that most social scientists say this is true but most physical scientists say it is false.

braiamp 1y ago

And we have very rigorous models that confirm that that is true. Perception shapes the economy more than actual fundamentals, specially when predicting the future.

terminalshort 1y ago

Macroecon, yes. Micro is actually very useful and has a good amount of predictive power.

rrsp 1y ago
Could you recommend any good resources for learning more about microeconomics?
- wjnc 1y ago
  The absolute classic would be Hal Varian, afaik still chief economist at Google. Still proud of working through Microeconomic Analysis. He has an introduction into micro as well. His books are so full of worthwhile thoughts. Micro introduced me to platform economics before the internet was a big thing.

elif 1y ago

Correct. Success in modern market economics is 90% about determining the future sentiment of economists.

rapsey 1y ago
That is not true. Markets are moved by traders not economists. Professional traders have a very skeptical view of economists, because economists are simply wrong so often about the future. Economists from the world bank and such institutions are usually on the wrong side of forecasting for instance. For instance Scott Bessent opinion: "I will take the market-based indicators over the so-called 'experts' all the time! That’s how I made my 35-year career, was listening to the market."
- krona 1y ago
  Distal causes vs proximate causes. Sure, you need traders to move the markets, and if that's good enough for Scott Bessent, good for him.
- elif 1y ago
  The traders are all operating within the windows established by the policy choices of economists using fake money generated by economists to satisfy their own invented metrics. And traders are not themselves predicting the future as you put it, but they are predicting the future sentiment of other traders.
- halfcat 1y ago
  > Markets are moved by traders And traders are moved by the Federal Reserve’s interest rate decisions

stop50 1y ago

That is why there is no nobelprize for economics. Only an Nobel Memorial Prize in Economic Sciences.

logicchains 1y ago

Economic models that have strong empirically demonstrated predictive power are called finance, not economics, because any economic predictive model that actually works can be used to make money.

chneu 1y ago

Economics is kinda like weather prediction. Most people don't understand what economists are saying and they react based on what they think economists are saying. The same is true for things like rain predictions in that people don't understand what the prediction is, so when it doesn't rain people think "the weatherman is never right" when that isn't what the prediction was saying in the first place. That said, economics is a mostly bunk "science".

Workaccount2 1y ago

I cannot disagree more, having hand waved away economics for 20 years, actually learning it has totally transformed my world view into a dramatically clearer and far more functional one. The pandemic era fiscal and monetary policy was pretty much a 5x speed (because of the scale of everything) display of economics at work, and understanding all the levers while they were pulled made it clear that no, economics is not bullshit, people just really don't like what economics has to say.

andrekandre 1y ago
> economics is not bullshit, people just really don't like what economics has to say. you've piqued my interest, what does it say that people don't like? (i have my own ideas so im curious what others think)
- Workaccount2 1y ago
  Lots of people want to make it a law to "have their cake" after "eating their cake". Economics tells them they are dumb, so they call economics dumb.
  - andrekandre 1y ago
    > Lots of people want to make it a law to "have their cake" after "eating their cake". any good examples? (do you mean something like bailouts or tax cuts?)
    - HDThoreaun 1y ago
      Tariffs. Economic theory tells us that tariffs are terrible. Populists want them because they think manufacturing will come back(have their cake) but the downsides are much, much worse(eat it too).
      - andrekandre 1y ago
        now it clicked, appreciated ^^

adverbly 1y ago

There's some truth to this take but it's not nearly as bad as most people think. Many people look at the economy and see that it is bad and so they think the economists must be bad at their job, but in many cases people in power simply don't listen to economists. The best example of this in my opinion is land value tax. Milton Friedman is an Nobel prize winner on the libertarian side who called lvt the best tax policy. Joseph Stieglitz is a Nobel prize winner who is a socialist who also advocated for lvt. A recent survey showed something like 83% of economists saying that lvt would significantly increase growth. And yet zero countries have implemented an lvt rate that is much higher than inflation. Good and smart policies do not need to be accepted by economists to be implemented. They need to be accepted by those in power and by the general population. In my opinion, if anything we should have way more economists on the news talking about the economy than the political pundits that you typically see - not the other way around!

jesuslop 1y ago

To be smothered in debts has nothing of spiritual.

avs733 1y ago

I’ll say that when I read business and economics it often feels like it is starting from the assumption that it is right and then trying to perform the language of science until you believe them. Add to that the wild level to which economists seem to think their economics knowledge generalizes to telling other disciplines and I tend to approach with distrust.

throw0101c 1y ago

> Economics seems more like a religion than science […] Science makes falsifiable statements that are then tested (per Popper). When QE started a group of folks made predictions: > We believe the Federal Reserve’s large-scale asset purchase plan (so-called “quantitative easing”) should be reconsidered and discontinued. We do not believe such a plan is necessary or advisable under current circumstances. The planned asset purchases risk currency debasement and inflation, and we do not think they will achieve the Fed’s objective of promoting employment. * https://www.hoover.org/research/open-letter-ben-bernanke https://www.hoover.org/research/open-letter-ben-bernanke Another group of folks (often label "Keynesian") made different predictions based on their model(s) / understanding of how things work.. One turned out correct and other incorrect in their predictions. Perhaps we should follow the models that accurately predicted things. Governments / politicians run economic experiments every time there's a major policy rollout, and they do so based on what they predict will happen: * https://en.wikipedia.org/wiki/Kansas_experiment https://en.wikipedia.org/wiki/Kansas_experiment It is not the fault of the academic discipline itself if people ignore the results of the experiments for ideological reasons. RFK Jr., the current US Secretary of HHS, is ignoring all the empirical evidence about vaccines (and even germ theory): is that the fault of biology?