Showing posts with label physics. Show all posts
Showing posts with label physics. Show all posts

Tuesday, October 15, 2013

Economics Isn't Science - "Economics Is Harder Than Physics" Edition

So, while Higgs and Englert got the Nobel prize in physics after the biggest machine we have ever built had produced conclusive evidence that proved them right, the "Nobel prize" in economics went to both Shiller and Fama and additionally Hansen, one of whom has been conclusively proven wrong by the biggest disaster of our time. (Yves Smith posted an excerpt of her book concerning Fama which I completely agree with)

Reading what people had to say about two contradicting ideas) both getting the same price at the same time, I came across this gem, by Justin Fox. It started out great, but seemed to completely collapse in the second paragraph.

He claimed:

This is, to a certain extent, further evidence that economics isn’t a science like physics is a science [..]. But that’s not because economists are all frauds — it’s at least partly because economics is harder than physics.
Wait what? I completely agree with the first part, but the second part is, well, interesting. I would have at least expected some kind of explanation, but non is given. The rest of the post is actually a good read, but that is a pretty big claim. Let me try to explain why economics is in some respects harder than physics and why some economists are still frauds (but often not intentionally).