Can Economics Change Your Mind?
Economics is sometimes dismissed as more art than science. In this skeptical view, economists and those who read economics are locked into ideologically motivated beliefs—liberals versus conservatives, for example—and just pick whatever empirical evidence supports those pre-conceived positions. I say this is wrong and solid empirical evidence, even of the complicated econometric sort, changes plenty of minds.
For one thing, it's changed my mind. Work from David Autor, David Dorn, and Gordon Hanson has convinced me that in some local areas the job losses from free trade can be substantial, and that these communities have been slower to adjust than I expected. Importantly, the study is not simple and utilizes instrumental variables, representing the kind of econometrics that skeptics think can't convince anyone.
Another example is, Mark Zandi, chief economist of Moody's Analytics, who tells me the paper "Potential Output and Recessions: Are We Fooling Ourselves?" by Robert Martin, Teyanna Munyan, and Beth Anne Wilson changed his mind recently. This study suggests that recessions tend to have a permanent negative effect on output, which was previously not thought to be the case. As a result Moody's Analytics is undertaking more research on this.
Researchers also frequently set out to test a hypothesis they think is right, only to find it was wrong. Harvard economists Raj Chetty and John Friedman were skeptical of standardized test based measures of teacher performance, and they set off to do research, along with Jonah Rockoff, which they thought was "going to show that these measures don’t work, that this has to do with student motivation or principal selection or something else." Instead, their evidence convinced them they were wrong, and their results showed that value-added measures were good measures of teacher quality, and the authors argue that school districts should use them in teacher evaluations.
Tyler Cowen's version here.
Overall I find that history and theory-laden observation tend to be the forms of evidence which have convinced me the most. #3 and #8 are examples of “sheer econometrics,” but that is not usually how minds are changed, mine included.
Economics is sometimes dismissed as more art than science. In this skeptical view, economists and those who read economics are locked into ideologically motivated beliefs—liberals versus conservatives, for example—and just pick whatever empirical evidence supports those pre-conceived positions. I say this is wrong and solid empirical evidence, even of the complicated econometric sort, changes plenty of minds.
For one thing, it's changed my mind. Work from David Autor, David Dorn, and Gordon Hanson has convinced me that in some local areas the job losses from free trade can be substantial, and that these communities have been slower to adjust than I expected. Importantly, the study is not simple and utilizes instrumental variables, representing the kind of econometrics that skeptics think can't convince anyone.
Another example is, Mark Zandi, chief economist of Moody's Analytics, who tells me the paper "Potential Output and Recessions: Are We Fooling Ourselves?" by Robert Martin, Teyanna Munyan, and Beth Anne Wilson changed his mind recently. This study suggests that recessions tend to have a permanent negative effect on output, which was previously not thought to be the case. As a result Moody's Analytics is undertaking more research on this.
Researchers also frequently set out to test a hypothesis they think is right, only to find it was wrong. Harvard economists Raj Chetty and John Friedman were skeptical of standardized test based measures of teacher performance, and they set off to do research, along with Jonah Rockoff, which they thought was "going to show that these measures don’t work, that this has to do with student motivation or principal selection or something else." Instead, their evidence convinced them they were wrong, and their results showed that value-added measures were good measures of teacher quality, and the authors argue that school districts should use them in teacher evaluations.
Tyler Cowen's version here.
Overall I find that history and theory-laden observation tend to be the forms of evidence which have convinced me the most. #3 and #8 are examples of “sheer econometrics,” but that is not usually how minds are changed, mine included.
RSS Feed
