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Garbage-can econometrics

from Lars Syll

When no formal theory is available, as is often the case, then the analyst needs to justify statistical specifications by showing that they fit the data. That means more than just “running things.” It means careful graphical and crosstabular analysis …

garbageWhen I present this argument … one or more scholars say, “But shouldn’t I control for every-thing I can? If not, aren’t my regression coefficients biased due to excluded variables?” But this argument is not as persuasive as it may seem initially.

First of all, if what you are doing is mis-specified already, then adding or excluding other variables has no tendency to make things consistently better or worse. The excluded variable argument only works if you are sure your specification is precisely correct with all variables included. But no one can know that with more than a handful of explanatory variables.

Still more importantly, big, mushy regression and probit equations seem to need a great many control variables precisely because they are jamming together all sorts of observations that do not belong together. Countries, wars, religious preferences, education levels, and other variables that change people’s coefficients are “controlled” with dummy variables that are completely inadequate to modeling their effects. The result is a long list of independent variables, a jumbled bag of nearly unrelated observations, and often, a hopelessly bad specification with meaningless (but statistically significant with several asterisks!) results.

Christopher H. Achen

This article is one of my absolute favourites. Why? Because it reaffirms yours truly’s view that since there is no absolutely certain knowledge at hand in social sciences — including economics — explicit argumentation and justification ought to play an extremely important role if purported knowledge claims are to be sustainably warranted. As Achen puts it — without careful supporting arguments, “just dropping variables into SPSS, STATA, S or R programs accomplishes nothing.”

  1. ghholtham
    January 15, 2021 at 11:57 am

    Piltdown man, accepted as a genuine hominid for years, was a fake, made by combining human and ape bones. That just goes to show that palaeontology is useless because you can never guard 100 per cent against fakery and bad practice when looking at old bones. Very learned historians accepted that Hitler’s diaries were authentic. That just proves history is a waste of time since you can never be sure what happened in the past. The sources may be false or not tell the whole story. Anti-vaxxers must be right since double-blind controlled experiments cannot possibly control for all the variables affecting human health so such trials can’t be trusted. Empirical tests that cannot provide certainty even when done well and which – shock, horror – can be done badly are obviously untrustworthy so all empirical work should be shunned.
    It gets increasingly hard to satirise Lars Syll’s writings on econometrics.

    • Meta Capitalism
      January 15, 2021 at 12:09 pm

      Piltdown man, accepted as a genuine hominid for years, was a fake, made by combining human and ape bones. That just goes to show that palaeontology is useless because you can never guard 100 per cent against fakery and bad practice when looking at old bones. Very learned historians accepted that Hitler’s diaries were authentic. That just proves history is a waste of time since you can never be sure what happened in the past.

      .
      What crock of crap Gerald. You conflate historical events with the professional practice of historical studies as a disciple. The Piltdown fraud had nothing to do the the professional field of historical studies and your inability to discern the difference and conflate them is pure ignorance. Truly I expected more sophistication from you. I am really disappointed. You are using rhetorical sophistry for self-serving arguments.
      .
      I know well the history of the Piltdown fraud and the history of this event. You have misused and misrepresented the professional field of historical stuides for your own self-serving childish purposes. What next? How low will you go?
      .

      Anti-vaxxers must be right since double-blind controlled experiments cannot possibly control for all the variables affecting human health so such trials can’t be trusted. Empirical tests that cannot provide certainty even when done well and which – shock, horror – can be done badly are obviously untrustworthy so all empirical work should be shunned.

      .
      Bullshit rhetoric. Mere hyperbole and sophistry. We all know that sane use of double-blind studies and such tell us plenty and Lars arguments do not dismiss this. You are a whining sophist making his argument. The irony is the satire of your arguments. How sad you allow your emotions to get the better of you. So sad. So petty, and silly.

      • Meta Capitalism
        January 15, 2021 at 12:12 pm

        “You are a whining sophist making his argument” should be “You are a whining sophist making this argument.” Truly Gerald you aught to restrain your stupid emotions before posting. What a utterly ignorant argument you are making here. I have so enjoyed your thoughtful comments, but this is not one of them.

    • Meta Capitalism
      January 15, 2021 at 12:29 pm

      Do you really think that the field of historical studies has taken no notice of advancements in science Gerald? Do you really think that historians today don’t know about the advances in CRISPER and the ability to use Comparative Genomics? You argument and dissing of history presumes historians today relay on the same kinds of “evidence” that historians in the times of the Piltdown hoax. How disingenuous and shallow of an argument.

  2. January 15, 2021 at 12:57 pm

    Yours truly has to agree with Meta here. I too, Gerry, have enjoyed many of your thoughtful comments, but this is not one of them.

  3. ghholtham
    January 15, 2021 at 1:30 pm

    Well thanks for the compliment Lars. I am trying provoke you into saying how you think we can or should test economic propositions. Criticising bad practice where you find it is fine by me. And we know that generalisations cannot be “proven” beyond doubt. But if all econometrics is a lost cause, which you seem to imply, how do we do empirical economics? You and I share a distaste for the theological sort.

    • Meta Capitalism
      January 18, 2021 at 3:04 am

      Some thoughts …
      .

      I am trying provoke you into saying how you think we can or should test economic propositions. Criticising bad practice where you find it is fine by me. And we know that generalisations cannot be “proven” beyond doubt. ~ Gerald

      .
      Trying to “provoke” seems more like an emotional response than reasoned response, and I believe it is rooted in Gerald’s psychological projection onto Lars of his own insecurity that “econometrics is a lost cause.” Lar’s critiques of econometrics Gerald says, “Criticising bad practice where you find it is fine by me.” But then he makes the presumption that Lar’s is obligated to provide the alternative solution when in reality Lar’s has no such obligation, duty, or need to play that role. This is a blog for God’s sake, not a academic seminar or classroom or research program. That Gerald is projecting his own insecurity is seen in his statement, “which you seem to imply,” followed by the utterly unintelligible comment “You and I share a distaste for the theological sort.” What ever might one mean by “the theological sort?” Economic ideology?
      .

      I am really disappointed that you did not reply to my question. How can we advance empirical economics? How can we test any theories or generalisations that are put forward? The questions is not rhetorical. ~ Gerald

      .
      Perhaps Gerald your own expectations are the cause of your disappointment. Maybe Lars is exactly what he has said; a Gardner merely weeding the bramble a bit and that is it. You say you are “genuinely at a loss as to how you believe we should proceed to sort the chaff from the wheat – assuming there is any wheat.” Perhaps we are at a point in history where this is the question of the age?
      .
      And then you begin more emotionally laden psychological projection, such as “Your writing does not seemed designed to urge higher standards of intellectual honesty and technique in econometrics (with which one could only agree) but to discourage people from the attempt altogether. Ok but what then? (Gerald Holtham)”
      .
      As for urging more “intellectual honesty,” I most certainly have seen Lars do that in his book. You seem to be making a subtle ad hominem jab here meant to provide more than enlighten. You can do better Gerald, I know it. You just need to stop projecting your own insecurities and expectations onto Lars and start providing the balanced critical thinking you have so frequently exhibited on this blog and let Lars be himself, a Gardner merely clearing some weeds away.

      • Meta Capitalism
        January 18, 2021 at 3:06 am

        “provide more than enlighten” should be “provoke more than enlighten.”

  4. ghholtham
    January 17, 2021 at 7:40 pm

    Lars, I am really disappointed that you did not reply to my question. How can we advance empirical economics? How can we test any theories or generalisations that are put forward? The questions is not rhetorical. Since you are sceptical of experiment and statistical analyses I am genuinely at a loss as to how you believe we should proceed to sort the chaff from the wheat – assuming there is any wheat.
    Your writing does not seemed designed to urge higher standards of intellectual honesty and technique in econometrics (with which one could only agree) but to discourage people from the attempt altogether. Ok but what then?

    • Meta Capitalism
      January 18, 2021 at 11:35 am

      How can we advance empirical economics? How can we test any theories or generalisations that are put forward? The questions is not rhetorical. Since you are sceptical of experiment and statistical analyses I am genuinely at a loss as to how you believe we should proceed to sort the chaff from the wheat – assuming there is any wheat. ~ Gerald’s Question

      .
      One way is to take history seriously. Lars recommends this; you once said so yourself, but your rhetorical abuse of history doesn’t imply you do take history seriously. I even have a archived quote where you heap sarcasm on history (proving you are not always consistent). History shows social science in many ways is a case of illusory progress. Many of the same critiques made long ago are made today again.

  5. ghholtham
    January 18, 2021 at 1:40 pm

    Meta, I think you missed the point of my post . All of the statements in it were deliberately false and silly. I was trying to satirise the Lars’ approach to empirical testing in economics. I should have known better. Irony is seldom a good technique in multicultural contexts. Of course I take history seriously but it doesn’t answer the question of systematic testing. Lars won’t answer the question, either , it seems.

    • Meta Capitalism
      January 18, 2021 at 10:33 pm

      And all those statements make you, well, look silly. It is a blog, and blogs don’t do satire well. If your failure to communicate is on you and no one else.

  6. ghholtham
    January 19, 2021 at 2:24 pm

    All right let me be blunt. Lars is not a discriminating gardener clearing the undergrowth. He does clear a lot of weeds but he does not always distinguish the weeds from the useful plants. When it comes to empirical techniques he digs up everything, leaving barren land. When he is asked what should we plant now, he has nothing to say.

    • Meta Capitalism
      January 19, 2021 at 3:33 pm

      All right let me be blunt. Lars is not a discriminating gardener clearing the undergrowth. He does clear a lot of weeds but he does not always distinguish the weeds from the useful plants. ~ Gerald

      .
      Ok, let me be blunt too. Then stop whining and pretending and show the evidence and examples you have that lead us to fruitful plants? Put up your evidence and examples instead of your whining negative rhetoric, otherwise you have no more of a positive argument than Lars. Hence what are you whining about then?

      • Meta Capitalism
        January 19, 2021 at 3:37 pm

        In other words, Gerald, your sophistry (aka sarcasm) is just as barren as that which you protest against. That indeed is irony. When asked what have you planted and what fruit has it produced, you have nothing to say?

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