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Archive of posts filed under the Economics category.

“It’s as if you went into a bathroom in a bar and saw a guy pissing on his shoes, and instead of thinking he has some problem with his aim, you suppose he has a positive utility for getting his shoes wet”

The notion of a geocentric universe has come under criticism from Copernican astronomy. . . . A couple months ago in a discussion of differences between econometrics and statistics, I alluded to the well-known fact that everyday uncertainty aversion can’t be explained by a declining marginal utility of money. What really bothers me—it’s been bothering […]

How does inference for next year’s data differ from inference for unobserved data from the current year?

Juliet Price writes: I recently came across your blog post from 2009 about how statistical analysis differs when analyzing an entire population rather than a sample. I understand the part about conceptualizing the problem as involving a stochastic data generating process, however, I have a query about the paragraph on ‘making predictions about future cases, […]

Why isn’t replication required before publication in top journals?

Gabriel Power asks the above question, writing: I don’t recall seeing, on your blog or elsewhere, this question raised directly. Of course there is much talk about the importance of replication, mostly by statisticians, and economists are grudgingly following suit with top journals requiring datasets and code. But why not make it a simple requirement? […]

Replication Wiki for economics

Jan Hoeffler of the University of Gottingen writes: I have been working on a replication project funded by the Institute for New Economic Thinking during the last two years and read several of your blog posts that touched the topic. We developed a wiki website that serves as a database of empirical studies, the availability […]

Understanding the hot hand, and the myth of the hot hand, and the myth of the myth of the hot hand, and the myth of the myth of the myth of the hot hand, all at the same time

Josh Miller writes: I came across your paper in the Journal of Management on unreplicable research, and in it you illustrate a point about the null hypothesis via the hot hand literature. I am writing you because I’d like to move your current prior (even if our work uses a classical approach). I am also […]

Estimated effect of early childhood intervention downgraded from 42% to 25%

Last year I came across an article, “Labor Market Returns to Early Childhood Stimulation: a 20-year Followup to an Experimental Intervention in Jamaica,” by Paul Gertler, James Heckman, Rodrigo Pinto, Arianna Zanolini, Christel Vermeerch, Susan Walker, Susan M. Chang, and Sally Grantham-McGregor, that claimed that early childhood stimulation raised adult earnings by 42%. At the […]

The health policy innovation center: how best to move from pilot studies to large-scale practice?

A colleague pointed me to this news article regarding evaluation of new health plans: The Affordable Care Act would fund a new research outfit evocatively named the Innovation Center to discover how to most effectively deliver health care, with $10 billion to spend over a decade. But now that the center has gotten started, many […]

Skepticism about a published claim regarding income inequality and happiness

Frank de Libero writes: I read your Chance article (disproving that no one reads Chance!) re communicating about flawed psychological research. And I know from your other writings of your continuing good fight against misleading quantitative work. I think you and your students might be interested on my recent critique of a 2011 paper published […]

Differences between econometrics and statistics: From varying treatment effects to utilities, economists seem to like models that are fixed in stone, while statisticians tend to be more comfortable with variation

I had an interesting discussion with Peter Dorman (whose work on assessing the value of a life we discussed in this space a few years ago). The conversation started when Peter wrote me about his recent success using hierarchical modeling for risk analysis. He wrote, “Where have they [hierarchical models] been all my life? In […]

Visualizing sampling error and dynamic graphics

Robert Grant writes: What do you think of this visualisation from the NYT [in an article by Neil Irwin and Kevin Quealy but I'm not sure if they're the designers of the visualization]? I’m pretty impressed as a method of showing sampling error to a general audience! I agree. P.S. In related news, Antony Unwin […]