Macroeconomists dislike criticism like anyone else, and especially hate the idea that their opinions are no better than anyone else. So, I especially liked this little quip from one of the most insecure economists blogging today, Brad DeLong, who was invited to speak on macro at some poli-sci class:Professor Intro:Brad’s a great guy, we go way back …he blogs…here’s Brad
J.Bradford DeLong: I do remember being horrified once when I was introduced by the Vice President of the Federal Reserve Bank of Kansas City, not as an economic historian or macroeconomist or the sometime Deputy Assistant Secretary of the Treasury for Economic Policy, but as the weblogger.
So I’m going to start by putting up what I’m calling equation 11 up on the board, simply to demonstrate I am a real economist and to say this equation 11 is going to be the centrepiece of Lawrence H. Summers and J. Bradford DeLong’s Fiscal Policy in a Depressed Economy, which is going to be presented at the Brookings institutiton on Friday March 23, and then published in the Spring issue of the Brookings papers on Economic Activity.
Intro: You are a serious scholar and a serious policymaker which I did omit…I apologise
Here’s the equation 11 DeLong refers to, which contains 7 variables, a couple of which are straightforward (tax rate, the real growth rate), the rest could all be somewhere within the (-inf,inf) space that lets macro debates happen. Further, he’s talking about rates of change, so there’s an unspecified time dimension and these parameters are time-varying, having different short and long-term levels and the definition of ‘long term’ also probably varies over the business cycle.
He didn’t actually discuss what the equation is, or how it adds to the debate, just that he, his credentials, Larry Summers and their initials, will be speaking at an Important Institution which will then publish research that contains as a centrepiece, an equation. In short, equation 11 is being used to prove his profundity in the most disingenuous way, because equations by themselves do not mean anything. That is, it’s not like this equation has ever been empirically tested, let alone validated, and the history of economics is littered with empirically vacuous equations. Further, it’s not like it is going into a refereed publication.
Many mediocre minds are impressed by famous colleagues, graduate degrees, Harvard, or equations. Those people aren’t worth impressing. While such signals are correlated with good ideas, they are neither necessary nor sufficient for a good idea. When someone emphasises these signals, however, that should lower their credibility among thoughtful people because it suggests bad faith, a preference towards pretentious irrelevancies.
I’ve seen this a lot, hiding behind equations. It often works because one does not want to sit down, understand what all the variables mean and how they are measured, etc. I just don’t feel impressed at all by such equations because my Bayesian prior is they merely have a bad idea in equation form, so I don’t give them the benefit of the doubt even when I’m lazy and have not enough time to evaluate their maths.