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Science is prediction, not explanation - Fred Hoyle.

By that measure, economics hasn't qualified as a science yet. The prediction quality is terrible. That's embarrassing. There's plenty of data. There's plenty of compute power. By now, economics should have more predictive power that it demonstrates.




Scientists cannot accurately predict what the temperature in my city will be next month, so is climatology a science?

Economists could make predictions in isolated systems - the problem is 'the real world' is complex.

Worse - the economy is made up of human actors, and policy makers, investors, all of whom make decisions that are not necessarily rational. Ergo, in such systems, it's pretty hard to determine outcomes.

Economists can spell out for you pretty much what would happen if foreign purchasers dried up in Toronto, along with a slight increase in rates ... but we can't be sure if/when that would happen.


> Scientists cannot accurately predict what the temperature in my city will be next month, so is climatology a science?

weather forecasts have been getting more and more accurate, actually


Weather is inherently unpredictable. They'll never be perfect.

I missed the most important point: because the economy is made up of intelligent actors - there is a dynamic aspect to economist predictions.

If the weatherman says 'it will be 'very hot' next week' - this can be right or wrong, but the weather won't change as a result.

If a prominent economist says 'there will be a recession next month' - business leaders may hold up on investment thereby causing a recession, where none might have been.

So it's pretty hard to predict the future, when your predictions change the future ;)


That just seems like it makes it easier! You predict a recession, you're wrong, but you end up being right anyway!


It does, but working prediction models make money in the private sector (Wall Street), so you'll never see them.




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