Hoover - is macroeconomics real?
I have a HUGE issue with the comparison of macro and micro economics to macro and micro biology. The purpose of a metaphor is to explain something complex in terms of something simple so that your readers can associate the concepts. Metaphors should simplify the paper, not convolute it. While the idea is very interesting, it is inappropriate for these reasons.
That being said, I understood from the paper that macroeconomic fluctuations are real despite errors in deriving their micro foundations. I’m kind of confused what else to take from it, as it read more like a history-reporting paper than an analysis paper to me; furthermore, the train of thought was hard to follow as the paper seemed to be very unfocused. The section criticizing price indices could develop into a paper in and of itself. While “synthetic” aggregates are imperfect, and as such should have their shortcomings brought to light to avoid their leading to faulty conclusions.
I apologize, but I really don’t know what more to say on the matter. Please inform Hoover of these criticisms, Dr. Greenlaw - I think he’s on to something, but it needs focus.
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May 4th, 2008 at 3:29 pm
This layman is skeptical if macro-economics should be wagging the tail of microeconomics or should micro-economics be the tail wagger.
I see the rationale for the markets as dissemblings for strategic gambling. the only diffference between the gambler at the roulette table and the stock or commodity trader, is that the latter has computer generated probability data, while the gamer at the table has uncanny intuition to ow tech data.
The “dislocations” of markets and abuses by traders and investors are the proof that theory doesn’t accurately account for the practical consequences beyond apologetic statistics. It does little for those affected. I would guess that the compensatory gains occur to other micro-units while those effcted are left on the side of the macro-economic highway as roadkill.
A much as probability can be an accurte predictor of natural, unbiased processes, it cannot account for intentional willfullness for wrong dooing and abuses. To that extent, the theories of macro-economics that are based on probblsitic models donot address the profound affect of unethical greed that plays a LARGER factor in the DISRUPTIONS and DISLOCATIONS than the theorizers have been willing to admit.
Macro-economics are more the tool for high tech gambling, than it is the architecture for micro-economic security.
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