Wednesday, October 5, 2011

Keynes, Economics and Econometrics

Perhaps one of the biggest names in economics is Keynes; even those who have no knowledge of economics have heard of this chap Keynes. His work appears to float in and out of flavour, with a resurgence in 2008, but a fall back in 2009 on as we've headed towards the economics of austerity. Much is said and mis-said about Keynes, and one thing often presented is that he was anti-econometrics. There's a really good blog written by some econometrics lecturers in Canada which has a post on Keynes and his contributions to econometrics - it's well worth a read if you're interested in how the disciplines of economics and econometrics have developed.

1 comment:

  1. It does sound like you haven't really delved into econometrics with any great depth - if and when you do, you'll find just how rich it is. Macroeconomics suffers from aggregation as much as it benefits (it is a necessary evil to understand how economies at the national level are moving), and hence macro-econometrics will suffer from the aggregation of the millions of individual decisions. But if you look at micro-econometrics, you'll see a great many hugely interesting datasets that aren't aggregated, but that measure individual decisionmaking, and enable great insight into economic behaviour.

    Econometrics is always useful in making economics real - it tests it against the real world, and an economic theory that hasn't been tested against the real world is pretty useless at best.

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