What Makes Macro So Hard? Not a Yogi-ism, But Still Good (Optional)

This relates to Aaron’s question from the class quodlibet.

Attributed to Jan L. A. van de Snepscheut:†

In theory, there is no difference between theory and practice. But, in practice, there is.

In a nutshell, this is the problem with teaching macroeconomics. Is there any other field where the theory in texts is more blithely ignored by the practitioners?

Via the comment thread at Newmark’s Door for this post.

† This quote is often mis-attributed to Yogi Berra.

Food for Thought (Optional)

New colleague Paul Schneider repeated this example in brown bag seminar on teaching:†

Honestly, I wonder how many adults would respond that this question is not answerable.

In doing quantitative work, particularly with undergraduates, I run into something like this. It’s a sure fire sign that a student doesn’t understand the problem their working with if they print out every possible digit produced by their computer or calculator. Rounding, I guess, is an indicator of comfort with your level of understanding.

† I believe the cite for this is Bransford, John D., and Barry S. Stein. "The IDEAL problem solver." (1993).

Technorati Tags: bransford,stein

Augmented Capital

What if capital owned the labor instead of the other way around?

In growth theory, it’s called augmented labor, when we invent technology that allows a worker to control/use more capital at the same time. The robot above is capital, and it needs augmenting.

In this comic strip, that might be something like a way for a bunch of humans to nap with a minimal number of robots watching over them. Gee … sort of like a more benevolent vision of The Matrix.

This also illustrates growth and level effects, of technology. If the robots invented a technology that allowed them to control more humans, that would be a level effect that’s good for the robots. But having to deal with all those extra humans needing their nap would be the negative growth effect.

From the December 5, 2015 issue of Dilbert.

OPTIONAL: Tyler Cowen Thinks We Should Wake Up to the Misdirection

Is Trump playing liberals for fools?
Maybe.

Trump specializes in lower-status lies … The lie needs to be understood as more than just the lie.
… Long-term credibility does not need to be maintained. Once we get past blaming Trump for various misdeeds, it’s worth taking a moment to admit we should be scared he might be right about that.
… The Trump administration trusts neither its own appointees nor its own supporters, and is creating a situation where that lack of trust is reciprocal. That is of all things a strategy for getting things done …

Yikes.
This is just Tyler’s opinion, but he thinks on way more levels than I do.

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OOPS! You do not have to read this post.

I use one software (OpenLiveWriter) to write blog posts for multiple blogs. Above the line is a post I wrote for, and did post to, my non-academic blog voluntaryXchange. But I also clicked the button to post it here too. Unfortunately, it's 2017, and with social media, once something gets posted, it's hard to undo, and easier to just apologize. So ... sorry about this.

You're welcome to go read that blog if you like, but it isn't required. If I really want you to read something it's here on the class blog.

Please note that this post is paired with the one that immediately precedes it on that blog. So, if you do read this, go read this other one too. I'm not pro-Trump, but I'm trying to figure out how this is all going to pan out. I'm warming to the viewpoint that if he's crazy, he's "crazy like a fox"