Is reading economic weblogs just a waste of time? Kartik Athreya, an Economist with the Federal Reserve Bank of Richmond does think so. He has just published an provocative “letter to open-minded consumers of the economics blogosphere” entitled “Economics is Hard. Don’t Let Bloggers Tell You Otherwise.” (Athreya has removed his paper from Google Docs, but it’s still available here)
Athreya states that most economic bloggers do not “have anything interesting to say about economic policy.” The subject, he contends, is just too complicated – it takes you several years of strenuous education until you’re able to understand what’s going in the economy. “Much of my 1st year homework involved writing down tedious definitions of internally consistent outcomes. Not analyzing them, just defining them.”
Being an economic journalist (with a diploma in economics, though) you may imagine that I see things a little bit differently.
Of course a lot of ideas being discussed in economic blogs are rubbish. Unfortunately the same is true for a lot of things which are being published in very prestigious economic journals. A PhD in Economics is neither a precondition nor a guarantee that somebody is able to make good comments on economics. Unfortunately, sometimes even the contrary seems to be the case. The financial crisis delivered some very impressive examples of the shortcomings of “modern” state of the art macro economics. All these definitions and quantitative models which are so dominant in macro to a certain degree have distracted the economists. Sometimes the profession did not see the forest for the trees.
Ironically Athreyas arguments reveal a very uneconomic way of thinking. In a sense he wants that only professional academic macroeconomists talk about macroeconomics. This comes close of urging to end the division of labour within the economic profession. However, the idea that specialisation is welfare enhancing is one of the oldest insights of the dismal science. It is for a reason that Adam Smith’s famous observation of the division of labour in pin manufacturing “and the great increase in the quantity of work that results” is celebrated by the Bank of England on the current 20 pound notes in the UK.
What is true for pin manufacturers is also true for economists: Specialization generally increases quantity and quality. It is very sensible that some guys in the profession focus on developing sophisticated economic theories and models while others try to translate their findings for the general public. Of course these translators need to be able to understand what the researchers are saying. But it is no precondition that they are able to do the stuff themselves.
Academic economists should try harder explaining the relevance and usefulness of their research to the general public. Arguing that you’re not really able to understand the matter unless you’re a professionally trained economist does not really help, to put it mildly.
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Thanks to OS
Consequently, not only blogs should be silent on economic issues but also media and politicians. Discussions are limited to those who have spent years researching theoretically and empirically. We should limit our readings on scientific journals. In these weeks, we would probably learn the first time about the demise of Lehman.
How knowledge transfer takes place to those who have to live with the economic recommendations remains unclear in the world of Athreya
Athreya has also a wrong idea of blogs. Blogs are asking questions, rinse hidden information, try to give qualified opinion and like to start and join discussions. We do not claim to know the world better. But we believe that economists even don´t know it everything better.
Best Regard
D
You are precisely the kind of moron he’s complaining about. Go back to your cave, dimwit.
Without economic blogs, one would depend on the rubbish printed in mainstream-newspapers. At least in germany it is really boring to read most of the newspapers and magazines (execeptions: big parts of ftd, some parts of handelsblatt maybe…).
Reading blogs like http://www.weissgarnix.de keeps you thinking, keeps you informed and is fun…
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The problem with the line of criticism used in this blog is flawed, as it perpetuates a type of ignorance about the way macroeconomics is practiced. I doubt the author could tell you what the current macroeconomic model looks like or why it is flawed. Since, the type of models in academic economics are not forecasts about how the economy work. But either statistics (applied), or mathematics (Theoretical) models that are to promote understanding of how “the economy” works and study the effects of different policies and structures on economy. The line of criticism the author makes is simply paints macroeconomists as professional forecasters or oracles, something academic economics is not engaged in. Private sector, and Government economists may be professional analysts that are freqeuntly criticized.
I do agree with Athreya. It is hard for even first year graduate students to comprehend articles in economics journals. Much less a lay person to comment about them, as if they have some sort of expertise.
The problem in the blogosphere (on any issue, however non controversial) is that we swim in a vast ocean of nonsense. Skepticism is indeed in order. In my own field of medicine, the internet is replete with mind boggling conspiracy theories, quack cure suggestions and so on. Medicine has its own gray areas especially when it comes to complex treatments of major disorders. The variables are many and interact unexpectedly, often in a non linear manner. Yes, we unintentionally do get it wrong occasionally and the patient suffers, but that is risk; more to the point relative risk. We do not live in an absolute black and white world and medical decisions operate in that sphere but we get it mostly right. Observe the advancements that have been made in almost every field of human endeavor. Economics suffers even more, due to a large and direct presence of irrational and emotional actors, namely consumers along with their political biases. In the interest of freedom, economic activity cannot be as regulated as medical science for exactly that reason; we would not know the “mid point” of over or under regulation. Further, the modern world is very different from even a few decades ago. The increasing complexity of globally integrated economics will always be susceptible to an occasional crisis much like our bodies. Having said that, would we seriously want the contradictory cacophony of the Economics blogs (with all its attendant mud slinging) direct public policy? It would assure a permanent crisis and perpetual chaos. The simplistic “anti elitism” based argument is deeply flawed, as all of us have intrinsic worth. None of us can embark on even a modest repair of a modern automobile. There is a place for trained people and infrastructure in every field.
There is a problem with his position. He’s effectively tell Bloggers, most of whom are running it as a business, how to operate their business.
What would he know about running a Blog? See it goes both way’s.
In my field, engineering he’s effectively told me which field’s I can get work in. How many people are going to hirer a Mechanical Engineer with a specialization of Oil pump’s, if by regulatory and taxes, the industry is destroyed.
I would suggest that every person of any sort of qualification takes a step back, and open your eyes. Often times you will notice a flaw in something that you thought was sound. I don’t care if someone has an Econ Doctorate. They are still human, and prone to failure.
Forgive the bad grammar and spelling. Beer and Internet don’t always mix.
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