Thursday, December 14, 2006

Silliness From Edward Prescott

Some bloggers have recently commented on an editorial in the funny pages of the Wall Street Journal. This is the same Edward Prescott, who, after co-winning the "Nobel" prize in economics in 2004, was interviewed by the Arizona Republic. And Prescott said then, "It's easy to get over $200,000 in income with two wage earners in a household."

The engineers I know, when designing filters and otherwise applying the theory of linear systems, have some reason to believe that sytems they are modeling are linear. I don't see the same practical concern in economics. Here's an article that I like on mistaken consensus beliefs among mainstream macroeconomists:
  • White, Graham (2004). "Capital, Distribution and Macroeconomics: 'Core' Beliefs and Theoretical Foundations", Cambridge Journal of Economics, V. 28: 527-547

No comments: