Blog Post

Fed economist slams econ bloggers

What’s at stake: Going back to the subject of modern macro and who should talk about it, there’s been uproar this week on the blogosphere over Kartik Athreya’s provocative essay on economics blogs. Athreya argued that most blogging is done by ill-informed hacks. His argument that bloggers should either shut up about economics and economic […]

By: Date: July 4, 2010 Topic: Global Economics & Governance

What’s at stake: Going back to the subject of modern macro and who should talk about it, there’s been uproar this week on the blogosphere over Kartik Athreya’s provocative essay on economics blogs. Athreya argued that most blogging is done by ill-informed hacks. His argument that bloggers should either shut up about economics and economic policy or be treated to a general boycott of attention has, as one would expect, elicited a mostly hostile response from economics bloggers.

Kartik Athreya says that he’s totally puzzled by the willingness of many who fearlessly and breathlessly opine about economics, especially macro- economic policy. Deficits, short-term interest rate targets, sovereign debt are all chewed over with a level of self-assuredness that only someone who doesn’t know more could. The main problem is that economics, and certainly macroeconomics is not, by any reasonable measure, simple. When a professional research economist thinks or talks about social insurance, unemployment, taxes, budget deficits, or sovereign debt, among other things, they almost always have a very precisely articulated model that has been vetted repeatedly for internal coherence. Critically, it is one whose constituent assumptions and parts are visible to all present, and can be fought over. Comparing, even momentarily, such careful work with its explicit, careful reasoning, its ever-mindful approach to the accounting for feedback effects, and its transparent reproducibility, with the sophomoric musings of auto-didact or non-didact bloggers or writers is instructive. The issue is that there is extremely low likelihood that the speculations of the untrained, on a topic almost pathologically riddled by dynamic considerations and feedback effects, will offer anything new. Moreover, there is a substantial likelihood that it will instead offer something incoherent or misleading.

Mark Thoma argues that blogs stepped in when the current crisis hit and began analysing crucial economic issues in real time in a way conventional research never could have done. Online conversations among the best macroeconomists in the business were very helpful in understanding what was going on and in developing policy responses to it. Conventional research is mostly backward looking. Academic economists look at an event like the 73-74 recession, ask what caused it, build models to try to understand it, and they try to find policies that would have worked better than the ones that were actually implemented at the time. That’s fine for many issues, but when big shocks hit the economy that do not fit into the standard models, there’s no time to wait for academic economists to take their usual approach.

Ryan Avent argues that writers are there to analyse economic issues in a broader context, which includes all the messiness of real life and politics. "Real" economists often fail badly at these kinds of tasks. Athreya’s essay furthermore errs in missing the breadth and richness of the economics blogosphere. He seems unaware of the fact that there are many very good economists writing blogs. There are even some very good macroeconomists putting down their thoughts online, including some which have advanced the science.

Nick Rowe, from a Worthwhile Canadian Initiative, writes that blogs are a great way to bring together the disparate knowledge of widely dispersed people. Individually, each of us knows little. But we know different things. The problem in society is to bring individuals’ disparate knowledge together. Hayek’s point was that a price system is a good way to bring disparate knowledge together. Rowe makes the same point but for blogging. Blogging is a different form of conversation, and in some ways it is a better form of conversation than academic interaction. It’s much easier to listen in and join in. It’s like a 24-hour seminar held everywhere at once with a record of what everyone said, so you can even arrive late at the seminar and not miss anything.

Rajiv Sethi, professor at Columbia University, argues that if one can separate the wheat from the chaff, the reasoned argument from the noise, this process should result in a more dynamic and robust discipline. Persuading a multitude of informed, thoughtful, intelligent readers of the relevance and validity of one’s arguments using words rather than formal models is a far more challenging task than persuading one’s own students or peers. Sethi suspects that within a decade, blogs will be a cornerstone of research in economics. Many original and creative contributions to the discipline will first be communicated to the profession (and the world at large) in the form of blog posts, since the medium allows for material of arbitrary length, depth and complexity.

*Bruegel Economic Blogs Review is an information service that surveys external blogs. It does not survey Bruegel’s own publications, nor does it include comments by Bruegel authors.


Republishing and referencing

Bruegel considers itself a public good and takes no institutional standpoint. Anyone is free to republish and/or quote this post without prior consent. Please provide a full reference, clearly stating Bruegel and the relevant author as the source, and include a prominent hyperlink to the original post.

Read article More by this author
 

Blog Post

It’s hard to live in the city: Berlin’s rent freeze and the economics of rent control

A proposal in Berlin to ban increases in rent for the next five years sparked intense debate in Germany. Similar policies to the Mietendeckel are currently being discussed in London and NYC. All three proposals reflect and raise similar concerns – the increase in per-capita incomes is not keeping pace with increases in rents, but will a cap do more harm than good? We review recent views on the matter.

By: Inês Goncalves Raposo Topic: European Macroeconomics & Governance Date: July 8, 2019
Read article More on this topic
 

Blog Post

The breakdown of the covered interest rate parity condition

A textbook condition of international finance breaks down. Economic research identifies the interplay between divergent monetary policies and new financial regulation as the source of the puzzle, and generates concerns about unintended consequences for financing conditions and financial stability.

By: Konstantinos Efstathiou and Bruegel Topic: Finance & Financial Regulation Date: July 1, 2019
Read article More on this topic
 

Blog Post

The June Eurogroup meeting: Reflections on BICC

The Eurogroup met on June 13th to discuss the deepening of the economic and monetary union (EMU) and prepare the discussions for the Euro Summit. From the meeting came two main deliverables: an agreement over a budgetary instrument for competitiveness and convergence and the reform of the European Stability Mechanism (ESM) treaty texts. We review economists’ first impressions.

By: Bruegel and Inês Goncalves Raposo Topic: European Macroeconomics & Governance Date: June 24, 2019
Read article More on this topic
 

Blog Post

The campaign against ‘nonsense’ output gaps

A campaign against “nonsense” consensus output gaps has been launched on social media. It has triggered responses focusing on the implications of output gaps for fiscal policy under EU rules, especially for Italy. But the debate about the reliability of output-gap estimates is more wide-ranging.

By: Konstantinos Efstathiou and Bruegel Topic: European Macroeconomics & Governance Date: June 17, 2019
Read article More on this topic
 

Blog Post

The inverted yield curve

Longer-term yields falling below shorter-term yields have historically preceded recessions. Last week, the US 10-year yield was 21 basis points below the 3-month yield, a feat last seen during the summer of 2007. Is the current yield curve a trustworthy barometer for future growth?

By: Inês Goncalves Raposo and Bruegel Topic: Global Economics & Governance Date: June 11, 2019
Read article More on this topic
 

Blog Post

The 'seven' ceiling: China's yuan in trade talks

Investors and the public have been looking at the renminbi with caution after the Trump administration threatened to increase duties on countries that intervene in the markets to devalue/undervalue their currency relative to the dollar. The fear is that China could weaponise its currency following the further increase in tariffs imposed by the United States in early May. What is the likelihood of this happening and what would be the consequences for the existing tensions with the United States, as well as for the global economy?

By: Inês Goncalves Raposo and Bruegel Topic: Global Economics & Governance Date: June 3, 2019
Read article More on this topic
 

Blog Post

The next ECB president

On May 28th, EU heads of state and government will start the nomination process for the next ECB president. Leaving names of possible candidates aside, this review tries to isolate the arguments about what qualifications the new president should have and what challenges he or she is likely to face.

By: Bruegel and Konstantinos Efstathiou Topic: European Macroeconomics & Governance Date: May 27, 2019
Read article More on this topic More by this author
 

Blog Post

The latest European growth-rate estimates

The quarterly growth rate of the euro area in Q1 2019 was 0.4% (1.5% annualized), considerably higher than the low growth rates of the previous two quarters. This blog reviews the reaction to the release of these numbers and the discussion they have triggered about the euro area’s economic challenges.

By: Konstantinos Efstathiou Topic: European Macroeconomics & Governance Date: May 20, 2019
Read article More by this author
 

Blog Post

Is an electric car a cleaner car?

An article published by the Ifo Institute in Germany compares the carbon footprint of a battery-electric car to that of a diesel car, and argues a higher share of electric cars will not contribute to reducing German carbon dioxide emissions. Respondents rejected the authors’ calculations as unrealistic and biased, and pointed to a series of studies that conclude the opposite. We summarise the article and responses to it.

By: Michael Baltensperger Topic: Energy & Climate, Innovation & Competition Policy Date: May 13, 2019
Read article More on this topic More by this author
 

Blog Post

All eyes on the Fed

Last week the US Federal Reserve left the federal funds rate unchanged and lowered the interest rate on excess reserves. We review economists’ recent views on the monetary policy conduct and priorities of the United States’ central bank system.

By: Inês Goncalves Raposo Topic: Global Economics & Governance Date: May 6, 2019
Read article More on this topic More by this author
 

Blog Post

Is this blog post legal (under new EU copyright law)?

How new EU rules on using snippets from news publishers and on copyright infringement liability might affect circulation of information, revenue distribution, market power and EU business competitiveness.

By: Catarina Midões Topic: European Macroeconomics & Governance Date: April 8, 2019
Read article More on this topic
 

Blog Post

Secular stagnation and the future of economic stabilisation

Larry Summers’ and Łukasz Rachel’s most recent study documents a secular fall in neutral real rates in advanced economies. According to the authors, this fall would be even more marked in the absence of offsetting fiscal policies. Policymaking in a world of permanently low interest rates may be hard to navigate, especially in troubled waters. We review economists’ views on the matter

By: Inês Goncalves Raposo and Bruegel Topic: European Macroeconomics & Governance Date: April 1, 2019
Load more posts