Project 2

       The community that I am becoming a part of is the on-campus community of economics majors. My major is Economics so naturally I am looking to join my peers that are doing the same. I am also hoping to do some networking in the next few years with other economists and those in the field of economics and its applications.

       The job of an economist is to break down the world around them into numbers basically, that way predictions and calculations can be made. This basically makes everything a text within the realm of economics. Because of this I am not certain about which text(s) I will be focusing on for this project. The interview should provide necessary insight into the important and meaningful texts integrated into the society of economists.

       I plan to interview one of the many economics professors here at FSU, seeing as they are very involved within the community. I hope to write about the point of view that they introduce me to and the texts associated with this community as well as the community as a whole. They may send me to another individual for further information.

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Interview Summary: 

Nicolas Blanton

Mat Wenzel

ENC 2135

21 February 2018

Interview Summary

            On February 20th, 2018 I interviewed my macroeconomics professor Joe Calhoun. I chose to interview him because he is very involved with the academic community of FSU economists and I knew he would provide necessary insight for my essay. After some personal questions about how he became active within the community I asked Professor Calhoun how he would define the economics community. He defined it as those that are like-minded and have a true passion for economics. Such people turn economics into a profession and even a lifestyle. I found it interesting how personal his definition was.

            Calhoun identified some of the texts involved within the economics community and he divided them up into three sections: Textbooks, general books, and peer-reviewed journals. He described the textbooks as those used by teachers and professors. General books, he said, were those written by economists in the private sector. Peer-reviewed was self-explanatory in definition. He also provided descriptions of how these various genres of texts influence and shape the society, including details such as who is affected and how.

            As discussion leading into my research proposal question I asked what the characteristics of a good economist are. My professor’s response shocked me a bit because I expected something along the lines of result precision or prediction accuracy. Instead he said that it depends on what kind of research you do. If an economist puts out a large number of published journals and contributes a small, incremental bit every time then eventually all of the tiny contributions build up and one can be considered a “good economist,” simply by the total quantity of work. However, on the other side, if you perform research that is groundbreaking in one article that changes the game across the board, then one can be considered “good.” It becomes a matter of quality over quantity. Calhoun also pointed out that if you are not involved academically then public policy improvements can be a metric of how “good” an economist you truly are.

            Throughout this paper I want to discuss an issue within the economics community as a whole, but specifically how it has affected the FSU community. This issue is the occurrence of inconsistency between economic views. It is joked that if you ask 10 economists their opinions you will get 11 different opinions. I wish to know why that is and if something can be done about this. After all, conclusion precision is the ultimate goal of economists. My professor was able to shed some light upon this subject. He said that the complexity of markets and how all the pieces fit together is so difficult to predict that it is very difficult to draw the same conclusion twice. This is partly caused by the way people are raised and how they are taught, creating a sort of lens of which they view the world through. And since people themselves are so much different, it is expected that they will have varying degrees of interpretation.

            The most powerful and influential part of this interview was when I asked if there would be some way to achieve a better consensus between economic viewpoints. Calhoun simply replied no, and that we would not want a consensus. The different views create controversy that in turn sparks conversation and discussion about economic matters. He conveyed that different suggestions are healthy for the community and that one-track thinking can be detrimental.  

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Annotated Bibliography

 

LAURITZ LARSON J. An inquiry into the nature and causes of the wealth of nations. Journal of the Early Republic. 2015;35(1):1-23. http://search.ebscohost.com/login.aspx?direct=true&db=a9h&AN=100915696&site=ehost-live.

This is a book review about Adam Smith’s book “The Wealth of Nations.” The wealth of nations discusses basic economic principles and illustrates their importance within the time period. Adam Smith is considered the father of economics. This book review gives insight into how Smith’s considerations relate to today’s world. It will be very helpful to craft my project with the help of the economic policies embedded within this review.

 

Coyle D, Buxton MJ, O'Brien BJ. Measures of importance for economic analysis based on decision modeling. J Clin Epidemiol. 2003;56(10):989. http://search.ebscohost.com/login.aspx?direct=true&db=a9h&AN=11114412&site=ehost-live. doi: 10.1016/S0895-4356(03)00176-8.

This article discusses the use of economic models and predictions. It illustrates the importance of these models and how they can be used in creating hypotheses. It also talks about the problems with economic models and their shortcomings. This article will provide valuable understanding about how economic predictions are constructed and understood. This will provide a basis to my paper while I attempt to answer my research question.

 

Hudik M. Prediction in economics. Metascience. 2017;26(1):71-74. http://search.ebscohost.com/login.aspx?direct=true&db=a9h&AN=121518556&site=ehost-live. doi: 10.1007/s11016-017-0154-5.

This article also talks about economic models and predictions. It goes deeper into how they are used and how economists construct them. The author discusses the various ways that economics is unreliable and how that is what makes economics so interesting. There are multiple things discussed, this is a very broad article, but I will be focusing very finely on specific points within the text. This article will allow me to pinpoint more ways to view and talk about my research proposal and question. I hope to use this one and Measures of Importance to build off of one another.

 

Vladucu A. Philosophico-methodological analysis of prediction and its role in economics. Romanian Journal of Political Science. 2017;17(1):170-174. http://search.ebscohost.com/login.aspx?direct=true&db=a9h&AN=126001495&site=ehost-live.

This journal explores the classifications of economics as a true science versus a social science. It breaks apart the many excellences and failings of the science of economics and sorts them into categories of objective and subjective. Utilizing this technique gives a sort of insight into what can be achieved through economics. This will be very helpful in introductory paragraphs. I will facilitate necessary background information with the help of this journal.

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Annotated Bibliography (updated with 10 sources)

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Nicolas Blanton

Mat Wenzel

ENC 2135-15

5 March 2018

Annotated Bibliography

 

LAURITZ LARSON J. An inquiry into the nature and causes of the wealth of nations. Journal of the Early Republic. 2015;35(1):1-23. http://search.ebscohost.com/login.aspx?direct=true&db=a9h&AN=100915696&site=ehost-live.

This is a book review about Adam Smith’s book “The Wealth of Nations.” Smith’s book is thought of as the bible of economics. It was the first book to dive deep into economic theory. This will relate directly to many of my sources because it centers the use of economic theories in today’s world. It will be very helpful to craft my project with the help of the economic policies embedded within this review. I hope to use this source as a way to explain certain economic practices, creating a more comprehensible and digestible essay.

 

Coyle D, Buxton MJ, O'Brien BJ. Measures of importance for economic analysis based on decision modeling. J Clin Epidemiol. 2003;56(10):989. http://search.ebscohost.com/login.aspx?direct=true&db=a9h&AN=11114412&site=ehost-live. doi: 10.1016/S0895-4356(03)00176-8.

This article discusses the use of economic models and predictions. It illustrates the importance of these models and how they can be used in creating hypotheses. It also talks about the problems with economic models and their shortcomings. This relates to my other sources by discussing parts of my research question. This will provide the basis of the reasoning behind my argument, as well as forming a possible solution to the problem. This article will provide valuable understanding about how economic predictions are constructed and understood. This will provide a basis to my paper while I attempt to answer my research question.

 

Hudik M. Prediction in economics. Metascience. 2017;26(1):71-74. http://search.ebscohost.com/login.aspx?direct=true&db=a9h&AN=121518556&site=ehost-live. doi: 10.1007/s11016-017-0154-5.

This article also talks about economic models and predictions. The author discusses the various ways that economics is unreliable and how that is what makes economics so interesting. This is also what makes it so controversial and easily debated within my essay. This will help discuss my research question. This article will allow me to pinpoint more ways to view and talk about my research proposal and question. I hope to use this one and Measures of Importance to build off of one another.

 

Vladucu A. Philosophico-methodological analysis of prediction and its role in economics. Romanian Journal of Political Science. 2017;17(1):170-174. http://search.ebscohost.com/login.aspx?direct=true&db=a9h&AN=126001495&site=ehost-live.

This journal explores the classifications of economics as a true science versus a social science. It breaks apart the many excellences and failings of the science of economics and sorts them into categories of objective and subjective. This will provide some ethos to my article which is very important because there is a large group of people that think negatively about economics as a “science.” This journal relates to my sources in the way that it talks about economics, but I will be using it in a different way. This will be very helpful in introductory paragraphs. I will facilitate necessary background information with the help of this journal.

 

Calhoun, Joseph. Personal interview. 20 February 2018

This is the interview I conducted with my Economics professor. He was able to provide personalized information about how the economics community functions. This is a very different source compared to my other sources, but I believe it provides the most crucial information. This interview allowed me to come up with and shape my exploratory research question. I hoped that this interview would facilitate some of the “active texts” within my community but I was unfortunately not able to discover any more. I am also using this as a scholarly source because the information provided comes from a scholar.

 

Davis, Marc. "Why Can’t Economists Agree?" Investopedia Page 1. Web. https://www.investopedia.com/articles/economics/09/why-economists-do-not-agree.asp

In this online magazine article, Marc Davis discusses the various reasons why economists disagree. This is discussed, helpfully, with less of the elaborate and sophisticated talk that some academic journal articles tend to have. This will aid me in understanding the main ideas better and in turn explaining them to my audience in an improved manner. This source is different from my others because it is specifically about this topic instead of having that topic as a piece of its whole, like the other sources. I like that it has a list of different types of data, this specificity will be most helpful.

 

McArdle, Megan. "4 Politically Controversial Issues Where All Economists Agree" The Atlantic 9 April 2012: Page 1. Web. https://www.theatlantic.com/business/archive/2012/04/4-politically-controversial-issues-where-all-economists-agree/255600/

This magazine article explores a few issues that most economists agree on. This source will provide a small counter argument that will actually strengthen my original argument. This will become clear how within my paper. This source is most like the other magazine article in the measures of its specificity, which will improve the comprehensiveness of my essay altogether. It mentions a few examples that I am aware of and familiar with, so they will be easier to discuss.

 

Higgs, Robert. “What Makes a Good Economist.” Mises Wire, Mises Institute, 2 June 2015, mises.org/wire/what-makes-good-economist-%E2%80%94-one-paragraph.

Robert Higgs takes a look at what makes a good economist. He gives three specific points of emphasis that he says are the most important. This blog may allow for me to open and answer some of the questions one may have about all these sources. The interesting thing about this source is that it is only one paragraph, but it provides the necessary information.

 

Namaki A, Shirazi AH, Raei R, Jafari GR. Network analysis of a financial market based on genuine correlation and threshold method. Physica A. 2011;390(21):3835-3841. http://search.ebscohost.com/login.aspx?direct=true&db=a9h&AN=65045058&site=ehost-live. doi: 10.1016/j.physa.2011.06.033.

This journal comments on financial markets and how they are analyzed. It will provide commentary about how complex markets may be predicted. This relates to some of my sources because it talks about prediction within financial systems. The authors use Random Matrix Theory to create correlations.

 

Yl-Cheng Zhang, Miguel A F. Dynamical complexity of market mechanism. International Journal of Modern Physics B: Condensed Matter Physics; Statistical Physics; Applied Physics. 2003;17(22-24):4168. http://search.ebscohost.com/login.aspx?direct=true&db=a9h&AN=11055401&site=ehost-live.

This journal comments on theory that is successfully applicable to markets. This relates to my subject matter by illustrating what is effective within financial market systems, from a physicist point of view. This point of view is different from any of the other articles in this list. This journal subverts genre expectations by challenging long standing economic theory.

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500 Word Polished Draft

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Nicolas Blanton

Mat Wenzel

ENC 2135-15

5 March 2018

Project 2: 500 Word Draft

            Everyone in my high school graduating class that passed Calculus, and maybe even physics, then went on to major in a STEM field when they got to whatever college that they chose to attend, normally within the state of North Carolina. This makes me, someone who went out-of-state for college and is currently not studying a STEM field, an outlier. People ask why I chose Florida State University and why I chose to study Economics of all fields. Most do not know what economics entails. Well, I have always been good at numbers, so I passed calculus, but I am not very proficient with physics. This meant that my childhood dream of being an engineer was crushed. This also meant I needed to find something else to major in. Google helped by searching what kind of majors work well for people that are good with numbers. When I read the description of an economist I knew right then and there that that was my calling. I was going to be a great economist. This led me to Florida State because we have the fourth or fifth best economics program in the nation and the top three or four are either too expensive or too academically inclined. I am, therefore, joining the community of future economists here at Florida State University. I have investigated joining the Economics club but have not had the time to be active within it these last two semesters. I hope to change that in the fall.

            There are plenty of jokes about economists out there. They all have the same premise, which is the fact that different economists will never give you the same answer. The inconsistency within the overarching economics community is staggering and rather infamous. I would like to question why economists can never agree, and if there is possibly a way to come up with some sort of consensus. In order to begin to answer either of these questions I decided to talk to someone that is very active within the economics community, especially the one here on campus, my Economics professor Joseph Calhoun. I had his microeconomics class last semester and I am currently enrolled in his macroeconomics class. I asked him a few questions to help shed some light on the subject. I thought that maybe the inconsistency comes from accurate vs. inaccurate measurements or predictions. Thus, I asked, “What makes a good economist?” Calhoun replied that a good economist depends on what the economist is currently involved in. If one is involved in more economics research, then the number of conclusions drawn, or the importance of those conclusions, can define their greatness. If an economist is a teacher, like Calhoun himself, then the ability to teach and explain economic theory and practices will measure their success. Finally, for an economist that is more prevalent within the private sector, the amount of positive policy changes that one evokes can be utilized as the metric of which to scale their accomplishment.

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1500 Word Draft

Nicolas Blanton

Mat Wenzel

ENC 2135-15

21 March 2018

Project 2: 1500 Word Draft

            Everyone in my high school graduating class that passed Calculus, and maybe even physics, then went on to major in a STEM field when they got to whatever college that they chose to attend, normally within the state of North Carolina. This makes me, someone who went out-of-state for college and is currently not studying a STEM field, an outlier. People ask why I chose Florida State University and why I chose to study Economics of all fields. Most do not know what economics entails. Well, I have always been good at numbers, so I passed calculus, but I am not very proficient with physics. This meant that my childhood dream of being an engineer was crushed. This also meant I needed to find something else to major in. Google helped by searching what kind of majors work well for people that are good with numbers. When I read the description of an economist I knew right then and there that that was my calling. I was going to be a great economist. This led me to Florida State because we have the fourth or fifth best economics program in the nation and the top three or four are either too expensive or too academically inclined. I am, therefore, joining the community of future economists here at Florida State University. I have investigated joining the Economics club but have not had the time to be active within it these last two semesters. I hope to change that in the fall.

            There are plenty of jokes about economists out there. They all have the same premise, which is the fact that different economists will never give you the same answer. The inconsistency within the overarching economics community is staggering and rather infamous. I would like to question why economists can never agree, and if there is a way, possibly, to come up with some sort of consensus. In order to begin to answer either of these questions I decided to talk to someone that is very active within the economics community, especially the one here on campus, my Economics professor Joseph Calhoun. I had his microeconomics class last semester and I am currently enrolled in his macroeconomics class. I asked him a few questions to help shed some light on the subject. I thought that maybe the inconsistency comes from accurate vs. inaccurate measurements or predictions. Thus, I asked, “What makes a good economist?” Calhoun replied that a good economist depends on what the economist is currently involved in. If one is involved in more economics research, then the number of conclusions drawn, or the importance of those conclusions, can define their greatness. If an economist is a teacher, like Calhoun himself, then the ability to teach and explain economic theory and practices will measure their success. Finally, for an economist that is more prevalent within the private sector, the amount of positive policy changes that one evokes can be utilized as the metric of which to scale their accomplishment. A major reason that economists disagree, or more accurately vary in interpretation, is because of the complexity of Economic data. Calhoun also added that personal background such as who an economist studied under and where they come from can alter views when it comes to hypotheses. He described it as a lens that we see the world through. Through this paper other factors will be discussed. Concluding the interview, I asked one final question and that is “Would there possibly be a way to achieve a consensus on economic models and predictions. My professor’s answer surprised me but I am not going to share it quite yet.

            Adam Smith is often viewed as the Father of Economics and his book “An inquiry into the Nature and Causes of the Wealth of Nations” is seen as the economic bible. It was the breakthrough book that laid out the most basic economic principles. These principles included ones such as the idea of “invisible hand” economics and that people react to incentives in predictable ways. In short, people pursue their own selfish interests and through this they inadvertently pursue actions that stimulate economic growth. This is referred to as the “invisible hand” that guides people to making decisions that are good for the economy without actively doing so. This book also discussed how specialization of labor leads to economic growth and that market forces alone will decide price levels (Lauritz, 6). Taking all of these different relationships into account and then projecting them into the future is the job of an economist. There are many more factors to consider, since the US economy alone is worth over 19 trillion dollars, all flowing to and from places. And knowing where the money is coming from, where it is going, and why all of this is happening is usually quite complicated.

             One of the more sophisticated examples of just how complex and uncertain economic predictions can be is the issue of elasticity. It would be a lot easier if economists could say that raising prices or supply will increase or decrease the amount that consumers purchase. But that is not the case. Economist must take into account how much the target audience wants or needs the particular product or service. If the market is elastic, meaning that the market is very responsive to a price change, then lowering the price will actually boost revenue, because the members of the market will see the cheaper price and buy more, and the quantity purchased will outweigh the price drop. However, if the market is relatively inelastic, meaning that the members are not very responsive to a price change then raising the price will increase revenue, because the price increase does not change the purchasing habits of the consumers very much. Interpreting this information is very difficult and obtaining the information in the first place is sometimes challenging.

            This passage taken from Marek Hudik’s Book review “Predictions in Economics” truly sums up the main point.

Regarding this issue, the author claims that there is a “consensus on the notorious unreliability of many predictions… in different fields in economic activity,” using the fact that economists fail to predict crises as evidence (p. 1). Indeed, theories of business cycles do not provide reliable predictions (see, e.g., Loungani 2001 for a review). Nevertheless, there are theories which have relatively good predictive record, such as discrete choice theory (McFadden 1974), auction theory (King et al. 2007), and gravity theory of international trade (Anderson 2010). Why are predictions in some areas more reliable than in others? Is the complexity of the predicted phenomenon the only answer?

This illustrates why economics has such a bad track record when it comes to interpretations. We cannot predict important things such as business cycles and other crises, but we can predict small, specific portions.

            I would like to begin to answer the question of why economists disagree so much by taking a look at the two elementary sections of economic thinking. These two main types are Keynesian Economists and Free Market, or Laissez-fare Economists. The Keynesian economists believe that government taxation and spending is favorable and often times necessary to keep the market growing at a steady pace. Free Market Economists believe that government intervention is nothing but a hinderance to economic growth and that economic fluctuations will work themselves out over time through natural market processes (Davis). These two opposing views begin the divergence of economic views.

 

 

Works Cited

Davis, Marc. "Why Can’t Economists Agree?" Investopedia Page 1. Web. https://www.investopedia.com/articles/economics/09/why-economists-do-not-agree.asp

LAURITZ LARSON J. An inquiry into the nature and causes of the wealth of nations. Journal of the Early Republic. 2015;35(1):1-23. http://search.ebscohost.com/login.aspx?direct=true&db=a9h&AN=100915696&site=ehost-live.

Hudik M. Prediction in economics. Metascience. 2017;26(1):71-74. http://search.ebscohost.com/login.aspx?direct=true&db=a9h&AN=121518556&site=ehost-live. doi: 10.1007/s11016-017-0154-5.

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Project 2: 2000 Word Draft

Nicolas Blanton

Mat Wenzel

ENC 2135-15

28 March 2018

Project 2: 2000 Word Draft

            Everyone in my high school graduating class that passed Calculus, and maybe even physics, then went on to major in a STEM field when they got to whatever college that they chose to attend, normally within the state of North Carolina. This makes me, someone who went out-of-state for college and is currently not studying a STEM field, an outlier. People ask why I chose Florida State University and why I chose to study Economics of all fields. Most do not know what economics entails. Well, I have always been good at numbers, so I passed calculus, but I am not very proficient with physics. This meant that my childhood dream of being an engineer was crushed. This also meant I needed to find something else to major in. Google helped by searching what kind of majors work well for people that are good with numbers. When I read the description of an economist I knew right then and there that that was my calling. I was going to be a great economist. This led me to Florida State because we have the fourth or fifth best economics program in the nation and the top three or four are either too expensive or too academically inclined. I am, therefore, joining the community of future economists here at Florida State University. I have investigated joining the Economics club but have not had the time to be active within it these last two semesters. I hope to change that in the fall.

            There are plenty of jokes about economists out there. They all have the same premise, which is the fact that different economists will never give you the same answer. The inconsistency within the overarching economics community is staggering and rather infamous. I would like to question why economists can never agree, and if there is a way, possibly, to come up with some sort of consensus. This passage taken from Marek Hudik’s Book review “Predictions in Economics” truly sums up the main point.

Regarding this issue, the author claims that there is a “consensus on the notorious unreliability of many predictions… in different fields in economic activity,” using the fact that economists fail to predict crises as evidence (p. 1). Indeed, theories of business cycles do not provide reliable predictions (see, e.g., Loungani 2001 for a review). Nevertheless, there are theories which have relatively good predictive record, such as discrete choice theory (McFadden 1974), auction theory (King et al. 2007), and gravity theory of international trade (Anderson 2010). Why are predictions in some areas more reliable than in others? Is the complexity of the predicted phenomenon the only answer?

This illustrates why economics has such a bad track record when it comes to interpretations. We cannot predict important things such as business cycles and other crises, but we can predict small, specific portions. Some professionals have issues calling economics a science because it is extensively variable with its results.

In order to begin to answer either of these questions I decided to talk to someone that is very active within the economics community, especially the one here on campus, my Economics professor Joseph Calhoun. I had his microeconomics class last semester and I am currently enrolled in his macroeconomics class. I asked him a few questions to help shed some light on the subject. I thought that maybe the inconsistency comes from accurate vs. inaccurate measurements or predictions. Thus, I asked, “What makes a good economist?” Calhoun replied that a good economist depends on what the economist is currently involved in. If one is involved in more economics research, then the number of conclusions drawn, or the importance of those conclusions, can define their greatness. If an economist is a teacher, like Calhoun himself, then the ability to teach and explain economic theory and practices will measure their success. Finally, for an economist that is more prevalent within the private sector, the amount of positive policy changes that one evokes can be utilized as the metric of which to scale their accomplishment. A major reason that economists disagree, or more accurately vary in interpretation, is because of the complexity of Economic data. Calhoun also added that personal background such as who an economist studied under and where they come from can alter views when it comes to hypotheses. He described it as a lens that we see the world through. Through this paper other factors will be discussed. Concluding the interview, I asked one final question and that is “Would there possibly be a way to achieve a consensus on economic models and predictions?” My professor’s answer surprised me, but I will withhold his answer for now.

Adam Smith is often viewed as the Father of Economics and his book “An inquiry into the Nature and Causes of the Wealth of Nations” is seen as the economic bible. It was the breakthrough book that laid out the most basic economic principles. These principles included ones such as the idea of “invisible hand” economics and that people react to incentives in predictable ways. In short, people pursue their own selfish interests and through this they inadvertently pursue actions that stimulate economic growth. This is referred to as the “invisible hand” that guides people to making decisions that are good for the economy without actively doing so. This book also discussed how specialization of labor leads to economic growth and that market forces alone will decide price levels (Lauritz, 6). Taking all of these different relationships into account and then projecting them into the future is the job of an economist. There are many more factors to consider, since the US economy alone is worth over 19 trillion dollars, all flowing to and from places. And knowing where the money is coming from, where it is going, and why all of this is happening is usually quite complicated.

One of the more sophisticated examples of just how complex and uncertain economic predictions can be is the issue of elasticity. It would be a lot easier if economists could say that raising prices or supply will increase or decrease the amount that consumers purchase. But that is not the case. Economist must take into account how much the target audience wants or needs the particular product or service. If the market is elastic, meaning that the market is very responsive to a price change, then lowering the price will actually boost revenue, because the members of the market will see the cheaper price and buy more, and the quantity purchased will outweigh the price drop. However, if the market is relatively inelastic, meaning that the members are not very responsive to a price change then raising the price will increase revenue, because the price increase does not change the purchasing habits of the consumers very much. Interpreting this information is very difficult and obtaining the information in the first place is sometimes challenging.

I am a part of this campus and I am majoring in economics. As I progress through my curriculum here at Florida State I will become increasingly intimate with my major and those that are involved in it. I will be opened up to opportunities for networking and forming relationships with colleagues, relationships that will be valuable when I am in the job market. I am unfortunately not as fully involved as I wish to be, and this is because I have other life things going on. This is my first year of college and I am still trying to satisfy prerequisite classes such as this one. I currently also work 36 hours a week because I have to. I need that money because I am very far away from home and must take care of myself. I am very busy all the time, but my grades are not suffering, at least not yet. I am very pleased with my life right now. I am putting in the work that is necessary to land me a high paying job in the future. And to be honest, that is the only reason I am here. I do not actually care about Florida State (I know that hurts) beyond the academic and career advancements, and maybe that would be different if I was from here. I am only using this institution for its prestige and study opportunities. Once I have graduated I find it hard to believe that I will miss this place extensively. Intermittent visits may be something I choose to partake in but not essentially. The point I am trying to make is that I care about this place only because of my major and I only pursue that because it fits my likenesses which is useful for a career. Economics is not my life. Being a part of the economics club is not something I am striving tirelessly for, or else I would have joined right? My goal in life is to be successful, because after the day’s work is done and I am finally able to do what I want, only then am I living, only then am I actively participating in what I want my life to be about. This is why it may seem that this community of Florida State Economists is not something I am broadly involved in, because quite blatantly I am not. But I am working on it, and no doubt it will be accelerated as my professional pursuits begin to draw closer. Now that I have addressed my involvement, or partial involvement, within this community I can now discuss my research questions.

            I would like to begin to answer the question of why economists disagree so much by taking a look at the two elementary sections of economic thinking. These two main types are Keynesian Economists and Free Market, or Laissez-fare Economists. The Keynesian economists believe that government taxation and spending is favorable and often times necessary to keep the market growing at a steady pace. Free Market Economists believe that government intervention is nothing but a hinderance to economic growth and that economic fluctuations will work themselves out over time through natural market processes (Davis). These two opposing views begin the divergence of economic views. As previously mentioned, I asked my professor “Would there possibly be a way to achieve a consensus on economic models and predictions?” I expected him to give a simple yes or no answer. Instead he said that no, there is no way to construct one answer for all these economic questions and decisions, and then he made the best point of all. He said that we would not want that accord even if we could somehow acquire it. A consensus is not desirable for economists. He stated that varying suggestions is healthy for society and that disagreement spurs controversy which then incentivizes more research, which is always a positive thing. So, in other words, my professor took half of my research question and turned it upside down, claiming we do not need it. I love that. This also provides evidence for why economists cannot agree. The reason is because they are not supposed to and do not even want to try, and this disagreement is what is ultimately best for the economy. The multiple different views presented provides for clearer and more educated decision-making for politicians, everyday people, and other economists.

 

 

Works Cited

Davis, Marc. "Why Can’t Economists Agree?" Investopedia Page 1. Web. https://www.investopedia.com/articles/economics/09/why-economists-do-not-agree.asp

LAURITZ LARSON J. An inquiry into the nature and causes of the wealth of nations. Journal of the Early Republic. 2015;35(1):1-23. http://search.ebscohost.com/login.aspx?direct=true&db=a9h&AN=100915696&site=ehost-live.

Hudik M. Prediction in economics. Metascience. 2017;26(1):71-74. http://search.ebscohost.com/login.aspx?direct=true&db=a9h&AN=121518556&site=ehost-live. doi: 10.1007/s11016-017-0154-5.

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2500 Word Final Draft (woohoo)

Nicolas Blanton

Mat Wenzel

ENC 2135-15

2 April 2018

Project 2: 2500 Word Draft

            Everyone in my high school graduating class that passed Calculus, and maybe even physics, then went on to major in a STEM field when they got to whatever college that they chose to attend, normally within the state of North Carolina. This makes me, someone who went out-of-state for college and is currently not studying a STEM field, an outlier. People ask why I chose Florida State University and why I chose to study Economics of all fields. Most do not know what economics entails. Well, I have always been good at numbers, so I passed calculus, but I am not very proficient with physics. This meant that my childhood dream of being an engineer was crushed. This also meant I needed to find something else to major in. Google helped by searching what kind of majors work well for people that are good with numbers. When I read the description of an economist I knew right then and there that that was my calling. I was going to be a great economist. This led me to Florida State because we have the fourth or fifth best economics program in the nation and the top three or four are either too expensive or too academically inclined. I am, therefore, joining the community of future economists here at Florida State University. I have investigated joining the Economics club but have not had the time to be active within it these last two semesters. I hope to change that in the fall.

            There are plenty of jokes about economists out there. They all have the same premise, which is the fact that different economists will never give you the same answer. The inconsistency within the overarching economics community is staggering and rather infamous. I would like to question why economists can never agree, and if there is a way, possibly, to come up with some sort of consensus. This passage taken from Marek Hudik’s Book review of MetaScience titled “Predictions in Economics” truly sums up the main point.

Regarding this issue, the author claims that there is a “consensus on the notorious unreliability of many predictions… in different fields in economic activity,” using the fact that economists fail to predict crises as evidence (p. 1). Indeed, theories of business cycles do not provide reliable predictions (see, e.g., Loungani 2001 for a review). Nevertheless, there are theories which have relatively good predictive record, such as discrete choice theory (McFadden 1974), auction theory (King et al. 2007), and gravity theory of international trade (Anderson 2010). Why are predictions in some areas more reliable than in others? Is the complexity of the predicted phenomenon the only answer?

This illustrates why economics has such a bad track record when it comes to interpretations. We cannot predict important things such as business cycles and other crises, but we can predict small, specific portions of economic intereactions. Some professionals have issues calling economics a science because it is extensively variable with its results.

             In order to begin to answer either of these questions I decided to talk to someone that is very active within the economics community, especially the one here on campus, my Economics professor Joseph Calhoun. I had his microeconomics class last semester and I am currently enrolled in his macroeconomics class. I asked him a few questions to help shed some light on the subject. I thought that maybe the inconsistency comes from accurate vs. inaccurate measurements or predictions. Thus, I asked, “What makes a good economist?” Calhoun replied that a good economist depends on what the economist is currently involved in. If one is involved in more economics research, then the number of conclusions drawn, or the importance of those conclusions, can define their greatness. If an economist is a teacher, like Calhoun himself, then the ability to teach and explain economic theory and practices will measure their success. Finally, for an economist that is more prevalent within the private sector, the amount of positive policy changes that one evokes can be utilized as the metric of which to scale their accomplishment. A major reason that economists disagree, or more accurately vary in interpretation, is because of the complexity of Economic data. Calhoun also added that personal background such as who an economist studied under and where they come from can alter views when it comes to hypotheses. He described it as a lens that we see the world through. Through this paper other factors will be discussed. Concluding the interview, I asked one final question and that is “Would there possibly be a way to achieve a consensus on economic models and predictions?” My professor’s answer surprised me, but I will withhold his answer for now.

              Adam Smith is often viewed as the Father of Economics and his book “An inquiry into the Nature and Causes of the Wealth of Nations” is seen as the economic bible. It was the breakthrough book that laid out the most basic economic principles. These principles included ones such as the idea of “invisible hand” economics and that people react to incentives in predictable ways. In short, people pursue their own selfish interests and through this they inadvertently pursue actions that stimulate economic growth. This is referred to as the “invisible hand” that guides people to making decisions that are good for the economy without actively doing so. This book also discussed how specialization of labor leads to economic growth and that market forces alone will decide price levels (Lauritz, 6). Taking all of these different relationships into account and then projecting them into the future is the job of an economist. There are many more factors to consider, since the US economy alone is worth over 19 trillion dollars, all flowing to and from places. And knowing where the money is coming from, where it is going, and why all of this is happening is usually quite complicated.

               One of the more sophisticated examples of just how complex and uncertain economic predictions can be is the issue of elasticity. It would be a lot easier if economists could say that raising prices or supply will increase or decrease the amount that consumers purchase. But that is not the case. Economist must take into account how much the target audience wants or needs the particular product or service. If the market is elastic, meaning that the market is very responsive to a price change, then lowering the price will actually boost revenue, because the members of the market will see the cheaper price and buy more, and the quantity purchased will outweigh the price drop. However, if the market is relatively inelastic, meaning that the members are not very responsive to a price change then raising the price will increase revenue, because the price increase does not change the purchasing habits of the consumers very much. Interpreting this information is very difficult and obtaining the information in the first place is sometimes challenging.

I am a part of this campus and I am majoring in economics. As I progress through my curriculum here at Florida State I will become increasingly intimate with my major and those that are involved in it. I will be opened up to opportunities for networking and forming relationships with colleagues, relationships that will be valuable when I am in the job market. I am unfortunately not as fully involved as I wish to be, and this is because I have other life things going on. This is my first year of college and I am still trying to satisfy prerequisite classes such as this one. I currently also work 36 hours a week because I have to. I need that money because I am very far away from home and must take care of myself. I am very busy all the time, but my grades are not suffering, at least not yet. I am very pleased with my life right now. I am putting in the work that is necessary to land me a high paying job in the future. And to be honest, that is the only reason I am here. I do not actually care about Florida State (I know that hurts) beyond the academic and career advancements, and maybe that would be different if I was from here. I am only using this institution for its prestige and study opportunities. Once I have graduated I find it hard to believe that I will miss this place extensively. Intermittent visits may be something I choose to partake in but not essentially. The point I am trying to make is that I care about this place only because of my major and I only pursue that because it fits my likenesses which is useful for a career. Economics is not my life. Being a part of the economics club is not something I am striving tirelessly for, or else I would have joined right? My goal in life is to be successful, because after the day’s work is done and I am finally able to do what I want, only then am I living, only then am I actively participating in what I want my life to be about. This is why it may seem that this community of Florida State Economists is not something I am broadly involved in, because quite blatantly I am not. But I am working on it, and no doubt it will be accelerated as my professional pursuits begin to draw closer. Now that I have addressed my involvement, or partial involvement, within this community I can now discuss my research question and why it matters to me.

            I would like to begin to answer the question of why economists disagree so much by taking a look at the two elementary sections of economic thinking. These two main types are Keynesian Economists and Free Market, or Laissez-fare Economists. The Keynesian economists believe that government taxation and spending is favorable and often times necessary to keep the market growing at a steady pace. Free Market Economists believe that government intervention is nothing but a hinderance to economic growth and that economic fluctuations will work themselves out over time through natural market processes (Davis). These two opposing views begin the divergence of economic views. As previously mentioned, I asked my professor “Would there possibly be a way to achieve a consensus on economic models and predictions?” I expected him to give a simple yes or no answer. Instead he said that no, there is no way to construct one answer for all these economic questions and decisions, and then he made the best point of all. He said that we would not want that accord even if we could somehow acquire it. A consensus is not desirable for economists. He stated that varying suggestions is healthy for society and that disagreement spurs controversy which then incentivizes more research, which is always a positive thing. So, in other words, my professor took half of my research question and turned it upside down, claiming we do not need it. I love that. This also provides evidence for why economists cannot agree. The reason is because they are not supposed to and do not even want to try, and this disagreement is what is ultimately best for the economy. The multiple different views presented provides for clearer and more educated decision-making for politicians, everyday people, and other economists.

            Essentially, the field of economics is too complex to make one solid assumption about many topics like business cycles, economic crises, market fluctuations and other things of the sort. And there is no solution in sight to fix this “problem.” Nevertheless, this is a good thing. The various viewpoints provided by different economists and econometricians offers a fuzzy but fuller picture of how our market system is operating. This would be drastically bottlenecked if one decision was all to be considered. Luckily this is not the case. Going forward I think we should all just get used to the fact that this shit is not getting any simpler anytime soon. This is due to the fact that the world economy is growing larger and becoming multifaceted at a rate never before experienced in the global economy. This bumpy rollercoaster ride is going to get even more bumpy. So, it’s a good thing our government is relatively good at manufacturing economic restraints. These include counter-cyclical monetary policy and other open market operations. All of which are backed up with economic analysis, which yes, counts as a true science.

 

 

Works Cited

Davis, Marc. "Why Can’t Economists Agree?" Investopedia Page 1. Web. https://www.investopedia.com/articles/economics/09/why-economists-do-not-agree.asp

LAURITZ LARSON J. An inquiry into the nature and causes of the wealth of nations. Journal of the Early Republic. 2015;35(1):1-23. http://search.ebscohost.com/login.aspx?direct=true&db=a9h&AN=100915696&site=ehost-live.

Hudik M. Prediction in economics. Metascience. 2017;26(1):71-74. http://search.ebscohost.com/login.aspx?direct=true&db=a9h&AN=121518556&site=ehost-live. doi: 10.1007/s11016-017-0154-5.