Economic Doctoring And Tradeoff Types

“Should economists be advocates or engineers?” asks Noah Smith. Tradeoffs reveal how reliably they perform as either.

Smith worries that his trade’s “engineering” aspects are being sacrificed for “political advocacy” (e.g. some economists act like “a free-market priesthood,” not as neutral experts). He cites Google’s “real secret sauce” to illustrate good econ-engineering: rock-star economist Hal Varian, who designed their profusely profitable ad auctioning system.

Great, but how else are economists like engineers? Consider “tradeoffs”: Most economists believe “that there is a tradeoff between prosperity and income equality.” Yet the IMF finds “no observed tradeoff between [redistribution] and… economic growth.” Do engineers have such disputes?

1. Mechanistic tradeoffs: Engineering has direct iron-law tradeoffs, like car weight vs. fuel efficiency. Would cars built using economics-like tradeoffs be safe? When engineers don’t know why something works, they won’t build without knowing under what conditions it does.

2. Micro-deviancy: Microeconomics might have iron-law engineering-like tradeoffs, but engineering never uses components whose behaviors can deviate from prior patterns.

3. Macro-flip-flops: macroeconomics is even less engineering-like. Apparently economists may have gotten the “basic relationship” between interest rates and inflation “exactly wrong.”

4. Complexity-matched: Are economies like engines or bridges? No, they’re trickier. Not even climate systems or ecologies have parts that change behaviors as rapidly as people in markets.

7. Model tendencies: Models are relationships encoded. Despite well understood micro-level  relationships climate models aren’t great. Economic modellers face complexities compounded by weaker relationships. Thanks to multi-step cascading effects and diffusely coupled psychologically contingent behaviors, composite “tradeoffs” are likely indirect and unmechanistic. They’re tendencies not tradeoffs.

5. Economic doctoring: Economists are more like medics than engineers. Doctors don’t build what they work on; they have good science in some areas but much remains unknown.

6. Medieval doctrines: Despite having hyper-modern math-models, economists seemingly use medieval-medic-level doctrines. They grasp some basics (engineering-like bones and bleeding)  but few systemic “mechanisms” or treatments are known (and “diagnoses” always lead to bloodletting).

8. Ethics trading: To paraphrase Upton Sinclair, it’s difficult for people to advocate what their salary depends on them not advocating. Since political interests fund much economic research (e.g. Mercatus Center underwritten by "staunchly anti-regulatory” groups) are pre-commitments skewing research and interpretations? Just politics (and regulatory capture) “disguised as science”?

Good economists make clear their uncertainties, often nobody really knows (here, here). Socrates said, “Admitting ignorance is the beginning of wisdom.” Economists please wise up. 


Illustration by Julia Suits, The New Yorker Cartoonist & author of The Extraordinary Catalog of Peculiar Inventions.

Why a great education means engaging with controversy

Jonathan Zimmerman explains why teachers should invite, not censor, tough classroom debates.

Sponsored by the Institute for Humane Studies
  • During times of war or national crisis in the U.S., school boards and officials are much more wary about allowing teachers and kids to say what they think.
  • If our teachers avoid controversial questions in the classroom, kids won't get the experience they need to know how to engage with difficult questions and with criticism.
  • Jonathan Zimmerman argues that controversial issues should be taught in schools as they naturally arise. Otherwise kids will learn from TV news what politics looks like – which is more often a rant than a healthy debate.
Keep reading Show less

Are these 100 people killing the planet?

Controversial map names CEOs of 100 companies producing 71 percent of the world's greenhouse gas emissions.

Image: Jordan Engel, reused via Decolonial Media License 0.1
Strange Maps
  • Just 100 companies produce 71 percent of the world's greenhouse gases.
  • This map lists their names and locations, and their CEOs.
  • The climate crisis may be too complex for these 100 people to solve, but naming and shaming them is a good start.
Keep reading Show less

SpaceX catches Falcon Heavy nosecone with net-outfitted boat

It marks another milestone in SpaceX's long-standing effort to make spaceflight cheaper.

Technology & Innovation
  • SpaceX launched Falcon Heavy into space early Tuesday morning.
  • A part of its nosecone – known as a fairing – descended back to Earth using special parachutes.
  • A net-outfitted boat in the Atlantic Ocean successfully caught the reusable fairing, likely saving the company millions of dollars.
Keep reading Show less