The MIT Gang • Hacker News Board

Re: The MIT Gang

#51

Post by digi_owl » Sun, Jul 26, 2015, 4:21 PM UTC

washedup wrote: post #5

overpaidgoogler wrote: post #2

The distinction is usually referred to as saltwater vs freshwater economists (referring to the geographical location of the university's). Apart from MIT there is also Princeton and Stanford in the saltwater camp. And Krugman is right that the saltwater economists were vindicated by the recovery from the GFC. However Krugman is not a good spokesperson for saltwater economists. Most econ professors I know from saltwat…

We really need a way to simulate how the economy will react under certain policies. The current model is based on one hypothesis about how the economy works, when such policies may have been only tested once or twice before, AND when the test conditions were different in a lot of ways. Because of the complex nature of economic systems, prediction is extremely difficult. We have yet to see if the monetary policies bei…

http://www.debtdeflation.com/blogs/minsky/

May be of interest.

Re: The MIT Gang

#52

Post by overpaidgoogler » Mon, Jul 27, 2015, 11:03 AM UTC

pekk wrote: post #33

overpaidgoogler wrote: post #11

Earlier quoted context omitted.

I don't see any fundamental difference between what your call simulation and what economists call models. The only difference is that your believe in the possibility of models so accurate that one could easily verify that they give correct predictions, as opposed to existing models which are subject to continual debate. The reason it is so hard to stimulate the economy is that it represents the sum total of a large p…

Mathematical descriptions of large-scale static properties like equilibria are patently not the same as, say, dynamic discrete-time simulations with evolving state. I don't think we have anything satisfyingly like the latter for economics, but to claim that there is no fundamental difference is just inaccurate.

DSGE models are precisely "dynamic discrete-time simulations with evolving state" and they are the workhorse of modern macro.

Re: The MIT Gang

#53

Post by jeffbax » Tue, Jul 28, 2015, 5:38 PM UTC

dluan wrote: post #16

My beef with Krugman is his absolutism, which comes as way more smug when he's post-rationalizing.

Yeah, his problem is he's so lost in his own ego these days he's just a blatant ideologue at this point. He's uncharitable to his opponents, unwilling to acknowledge his own biases, and is more and more like the Bill O'Reilly of the left just better educated. His smugness and amazing ability to totally ignore any evidence to the contrary just makes me roll my eyes.

His ability to spin is uncanny, these being but two small examples of many http://econlog.econlib.org/archives/2015/07/krugman_on_cana_... http://econlog.econlib.org/archives/2015/04/krugmans_insigh....

Re: The MIT Gang

#54

Post by eutectic » Wed, Jul 29, 2015, 12:38 PM UTC

yummyfajitas wrote: post #22

eutectic wrote: post #18

Earlier quoted context omitted.

The economic slowdown could last 5-10 years and cost trillions of dollars (June 2009): http://news.bbc.co.uk/1/hi/business/8081813.stm Semi-prediction of a housing bubble (August 2002): http://www.nytimes.com/2002/08/02/opinion/dubya-s-double-dip... Inflation and interest rates will remain low in in spite of stimulus and QE (many times). A diagnosis of potential problems with the euro, many of which have come to pass…

A better question would be, "what predictions did Krugman make which disagreed with non-Keynesians that turned out right (or wrong)?" Various ideological enemies of Krugman made these same predictions. All you are really saying is that Krugman, along with everyone else, gets the easy ones right.

I'm not qualified to adjudicate between Krugman and the market monetarists, but I feel it is important to realise that many (and many prominent) people did fail to make these predictions, and essentially all of them have kept their jobs and their status.