Footnote 5 predicted perfectly the sort of thing I was going to say in response. You probably know more economics than I do, but I feel like there are some models of how markets work that quite successfully predict macro behaviour of systems without knowing all the local individual factors? E.g. re your suggestion that nurses are a large fraction of the âhighest impactâ career paths, I think we could run some decent calculations about the elasticity of the nursing labour market to find how many more nurses there will overall be if I decide to be a nurse in some particular place. Me being a nurse increases labour supply, marginally reducing wages in expectation, reducing the number of other people who choose to be nurses; this effect may be quite different in different professions, e.g. if there is a cap of X places in some government medical certification program and lots of people apply, as with medical school in India, then joining that profession may increase the total supply of doctors very little.
So I suppose I am still more optimistic than you that we can make, in some cases, simple models that accurately capture some important features of the world.
I feel like there are some models of how markets work that quite successfully predict macro behaviour of systems without knowing all the local individual factors?
Youâre right that youâre more optimistic than me for this one. I donât think we have good models of that kind in economics (or: I havenât come across such models; I have tried to look for them a little bit but am far from knowing all modeling attempts that have ever been made, so I might have missed the good/âempirically reliable ones).
I do agree that âwe can make, in some cases, simple models that accurately capture some important features of the worldââbut my sense is that in the social sciences (/â whenever the object of interest is societal or human), the features we are able to capture accurately are only a (small) selection of the ones that are relevant for reasonably assessing something like âmy expected impact from taking action X.â And my sense is also that many (certainly not all!) people who like to use models to improve their thinking on the world over-rely on the information they gain from the model and forget that these other, model-external features also exist and are relevant for real-life decision-making.
Footnote 5 predicted perfectly the sort of thing I was going to say in response. You probably know more economics than I do, but I feel like there are some models of how markets work that quite successfully predict macro behaviour of systems without knowing all the local individual factors? E.g. re your suggestion that nurses are a large fraction of the âhighest impactâ career paths, I think we could run some decent calculations about the elasticity of the nursing labour market to find how many more nurses there will overall be if I decide to be a nurse in some particular place. Me being a nurse increases labour supply, marginally reducing wages in expectation, reducing the number of other people who choose to be nurses; this effect may be quite different in different professions, e.g. if there is a cap of X places in some government medical certification program and lots of people apply, as with medical school in India, then joining that profession may increase the total supply of doctors very little.
So I suppose I am still more optimistic than you that we can make, in some cases, simple models that accurately capture some important features of the world.
Youâre right that youâre more optimistic than me for this one. I donât think we have good models of that kind in economics (or: I havenât come across such models; I have tried to look for them a little bit but am far from knowing all modeling attempts that have ever been made, so I might have missed the good/âempirically reliable ones).
I do agree that âwe can make, in some cases, simple models that accurately capture some important features of the worldââbut my sense is that in the social sciences (/â whenever the object of interest is societal or human), the features we are able to capture accurately are only a (small) selection of the ones that are relevant for reasonably assessing something like âmy expected impact from taking action X.â And my sense is also that many (certainly not all!) people who like to use models to improve their thinking on the world over-rely on the information they gain from the model and forget that these other, model-external features also exist and are relevant for real-life decision-making.
Makes sense, I think I donât know enough to continue this line of reasoning that sensibly!