Thread by @Noahpinion

Hey, folks! Today's @bopinion post is about an exciting topic...empirical macroeconomics!

Well, OK, actually people don't get very excited about empirical macroeconomics...and that's a BIG PROBLEM.

bloomberg.com/opinion/articl…

Macroeconomics isn't a science the way biology is a science.

It isn't even a science the way labor economics is a science!

But does that mean that looking at data, and trying to test theories, is useless?

Heck no!

Many academic macroeconomists try really hard to test theories as best they can.

And many academic macroeconomists do empirical research about various pieces of the economy, trying to gather crumbs of knowledge about how things really work.

This is humble, slow, boring, un-sexy work.

It's not the kind of thing you can build a political campaign around, or a macro investment thesis.

But damn it, it's HONEST.

But you don't want "humble, boring, honest, and slow", do you?

You want FAST results. Big bold theories that will change our politics and/or make you a bunch of money! YEAH!!

You want to understand the economy with beautiful, clean logic, and undeniable, perfect accounting identities.

You want it to really be THAT SIMPLE.

You don't want to test your fun cool theory with structural vector autogregressions with order restrictions and Cholesky decompositions, blah blah blah, yawwwwwn, BORING.

You want to say: MY GUYS PREDICTED THE CRISIS!! We called it, folks. Our theory WINS!

And you don't want to have to wait 20 years for some timid, bespectacled nerd to hand you a list of tentative conclusions about what we should do to stabilize the economy.

You want ACTION, and you want it NOW! Forward!!

And since mainstream theories don't even seem to work very well, why not? Why not go with fun, bold, and simple?

Well, no reason, I guess. Except scientific and empirical humility, if you're into that sort of thing.

But if you're one of those crazy wierdos who insists on trying to make a fundamentally not-very-scientific field as scientific as possible, I salute you.

(end)

bloomberg.com/opinion/articl…