I have what I think are very strong economic intuitions: it just makes sense to me and always has. I frequently think in terms of supply and demand. Do you think I would gain a great deal of value from the explicit mathematical formulations?
They are informed by and consistent with the books I’ve read.
I should note that I don’t know much about macroeconomics. Keynesian economics (like Marxism) baffles me. I need a Keynesian to explain to me why there should be “leakages” in the banking system.
What I am getting at is that you were informed by some books and, unsurprisingly, found your knowledge consistent with these books. But that’s no guarantee of correctness. There are a lot of books which teach and advocate views that range from not quite true to quite not true. The arbiter of correctness is reality.
You said that you have correct economic intuitions. So let me ask again—why do you believe they are correct, is that only because a book told you so?
When I was very young, my dad t aught me the basis of economic concepts . They made sense to me. Latter, when I took economics classes, the instruction seemed obvious. I found myself having a feeling for the principles, in contrast with others that I spoke to. For instance, my peers were astonished to learn about the huge mark-up on “fancy” water. A high school friend commented that the water is obviously not worth that much. I knew that “value” is subjective, rather than being an intrinsic property of an object, and that the price, rather than reflecting that supposed real-value, was the result of the interaction of supply and demand. The water was “worth” exactly as much as it cost, by the simple fact that people would pay for it at that price.
I read other economists. They sometimes expressed ideas from new perspectives, but the fundamental ideas were the same. I took college level classes.
My confidence in my economic understanding parallels my confidence in evolution: the ideas make sense to me, and they are, to my knowledge, endorsed by the professionals who work in the field, yet I don’t know of a way of verifying those concepts for myself, without relying on the testimony of those experts. I discount my economic knowledge somewhat, since economics in general seems more contentious than biology, and especially the foundation of biology.
I don’t know of a way of verifying those concepts for myself
Well, it’s pretty easy—try to make some real-life forecasts. There is a lot of economic activity happening all around the world and enough of it is visible and documented.
Take something you have an interest in, look at the current situation, explicitly apply the economic concepts you have, create a forecast (which you will be able to verify). Then see if your forecast worked out. Make a bunch of forecasts to get some diversification.
My first thought is “prediction is a b---- and macroeconomics is less predictable than anything else. Expecting to make predictions, and have them be right, is crazy.” Now, I know there’s a problem with that. (lthough, subjectively, I’m not doubting my knowledge any more than I was. I was going to type “Which makes me hugely suspect of my supposed knowledge”, but then I realized that’s not true and I was just signaling how “rational” I am (which, to go another level into meta-space, is, I think, what I’m doing right now, by telling you that I was going to falsely signal, then realized it and restrained myself))
Making predictions. That’s a good idea. I don’t have anything to lose except some false beliefs or some unfounded confidence in some beliefs.
What are some simple questions of which I can predict answers?
Not necessarily macroeconomics which are hard because if you can successfully predict things in that sphere, there is usually a simple way to monetize that ability.
Look at your economic intuitions. What kind of claims do they make? What do they think they can predict?
That if somthign is hard to get or make it will cost more than if its easy to get or make.
That some consumption is conscious consumption and provides a signalling benefit which swamps the direct material benefit.
Higher order goods have a longer delay to pay-off in the form of first order goods, but the progression to higher and higher order goods and the specialization that drives it, is economic growth.
People like variety in their consumption because of LMD in their utility functions.
If the price of a good rises, the prices of its compliment goods will fall slightly and the prices of its substitute goods will rice slightly (since people will buy more of substitute and less of the complement and supply & demand.
Economies of scale.
There’s no such thing as a free lunch.
(If you know that diminishing marginal returns are pervasive and allow for trade between actors, pretty much all of classical economics follows by implication.)
I have what I think are very strong economic intuitions: it just makes sense to me and always has. I frequently think in terms of supply and demand. Do you think I would gain a great deal of value from the explicit mathematical formulations?
Are your “very strong economic intuitions” correct and how do you know whether they are or not?
They are informed by and consistent with the books I’ve read.
I should note that I don’t know much about macroeconomics. Keynesian economics (like Marxism) baffles me. I need a Keynesian to explain to me why there should be “leakages” in the banking system.
Are they consistent with reality?
I believe so, but I don’t know how to check.
Well, on which basis do you believe so?
What I am getting at is that you were informed by some books and, unsurprisingly, found your knowledge consistent with these books. But that’s no guarantee of correctness. There are a lot of books which teach and advocate views that range from not quite true to quite not true. The arbiter of correctness is reality.
You said that you have correct economic intuitions. So let me ask again—why do you believe they are correct, is that only because a book told you so?
Let me be clarify:
When I was very young, my dad t aught me the basis of economic concepts . They made sense to me. Latter, when I took economics classes, the instruction seemed obvious. I found myself having a feeling for the principles, in contrast with others that I spoke to. For instance, my peers were astonished to learn about the huge mark-up on “fancy” water. A high school friend commented that the water is obviously not worth that much. I knew that “value” is subjective, rather than being an intrinsic property of an object, and that the price, rather than reflecting that supposed real-value, was the result of the interaction of supply and demand. The water was “worth” exactly as much as it cost, by the simple fact that people would pay for it at that price.
I read other economists. They sometimes expressed ideas from new perspectives, but the fundamental ideas were the same. I took college level classes.
My confidence in my economic understanding parallels my confidence in evolution: the ideas make sense to me, and they are, to my knowledge, endorsed by the professionals who work in the field, yet I don’t know of a way of verifying those concepts for myself, without relying on the testimony of those experts. I discount my economic knowledge somewhat, since economics in general seems more contentious than biology, and especially the foundation of biology.
Does that clarify? What should I be asking?
Well, it’s pretty easy—try to make some real-life forecasts. There is a lot of economic activity happening all around the world and enough of it is visible and documented.
Take something you have an interest in, look at the current situation, explicitly apply the economic concepts you have, create a forecast (which you will be able to verify). Then see if your forecast worked out. Make a bunch of forecasts to get some diversification.
Hmm...
My first thought is “prediction is a b---- and macroeconomics is less predictable than anything else. Expecting to make predictions, and have them be right, is crazy.” Now, I know there’s a problem with that. (lthough, subjectively, I’m not doubting my knowledge any more than I was. I was going to type “Which makes me hugely suspect of my supposed knowledge”, but then I realized that’s not true and I was just signaling how “rational” I am (which, to go another level into meta-space, is, I think, what I’m doing right now, by telling you that I was going to falsely signal, then realized it and restrained myself))
Making predictions. That’s a good idea. I don’t have anything to lose except some false beliefs or some unfounded confidence in some beliefs.
What are some simple questions of which I can predict answers?
Not necessarily macroeconomics which are hard because if you can successfully predict things in that sphere, there is usually a simple way to monetize that ability.
Look at your economic intuitions. What kind of claims do they make? What do they think they can predict?
That if somthign is hard to get or make it will cost more than if its easy to get or make.
That some consumption is conscious consumption and provides a signalling benefit which swamps the direct material benefit.
Higher order goods have a longer delay to pay-off in the form of first order goods, but the progression to higher and higher order goods and the specialization that drives it, is economic growth.
People like variety in their consumption because of LMD in their utility functions.
If the price of a good rises, the prices of its compliment goods will fall slightly and the prices of its substitute goods will rice slightly (since people will buy more of substitute and less of the complement and supply & demand.
Economies of scale.
There’s no such thing as a free lunch.
(If you know that diminishing marginal returns are pervasive and allow for trade between actors, pretty much all of classical economics follows by implication.)