Less Wrong is a community blog devoted to refining the art of human rationality. Please visit our About page for more information.

Karl_Smith comments on For progress to be by accumulation and not by random walk, read great books - Less Wrong

35 Post author: MichaelVassar 02 March 2010 08:11AM

You are viewing a comment permalink. View the original post to see all comments and the full post content.

Comments (102)

You are viewing a single comment's thread.

Comment author: Karl_Smith 02 March 2010 08:54:24PM 4 points [-]

I think this post overstates the case a bit. My general impression is that the scientific method "wins" even in economics and that later works are better than earlier works.

Now it might be true that the average macro-economist of today understands less than Keynes did but I'd be hard pressed to say that the best don't understand more. Moreover, there are really great distillers. In macro for example, Hicks distilled Keynes into something that I would consider more useful that the original.

Nonetheless, I think it is correct that someone should be reading the originals. If not there is the propensity for a particular distiller to miss an important insight and then for everyone else to go one missing it.

What this says to me is that there should be rewards to re-discovery. Suppose that I read Adam Smith and rediscover something great. I should be rewarded for that just as much as if I had come up with the idea myself. Afterall, it has the same effect on the current state of knowledge. However, that will not happen.

Rediscovering is not as prestigious as discovering, because it is not as difficult and does not signal intellectual greatness.

Comment author: MichaelVassar 03 March 2010 06:11:51AM 5 points [-]

I'm sure some people understand more than Keynes, both today and in his time, but can you name them? The understanding of the best unrecognized synthesizing geniuses of both today and Keynes' day aren't available. If you think that the most famous contemporary macro people know more than Keynes I won't laugh, just observe that they are probably using that knowledge to make hedge fund managers rich, not sharing it with you.

Macro-economists are rightly subject to the criticism "if your so smart, why aren't you rich".

Comment author: Karl_Smith 03 March 2010 06:20:12PM *  4 points [-]

So the easy answers might be:

Ben Bernanke

Mark Gertler

Micheal Wooford

Greg Mankiw

Its not clear to me why macro-economists are rightly subject to such criticism. To me its like asking a mathematician, "If you're so good at logical reasoning why didn't you create the next killer app"

Understanding how the economy works and applying that knowledge to a particular task are completely different.

Comment author: SecondWind 19 May 2013 06:03:38AM *  1 point [-]

"If you're so good at logical reasoning why didn't you create the next killer app"

'Designing the next killer app' seems to rely heavily on predicting what people will want, which is many steps and a lot of knowledge away from logical reasoning.

Comment author: TrevinPeterson 02 March 2010 11:52:59PM *  1 point [-]

Rediscovering is not as prestigious as discovering, because it is not as difficult and does not signal intellectual greatness.

There is a difference between rediscovering and old idea, and adapting an old idea to a new situation. Simply rediscovering an old idea does not grant much prestige. Austrians are constantly coming across Hayek quotes and parading them around as definitive solutions to current problems. The problem is that these ideas are every bit as untestable as they were on the day Hayek wrote them. A confirmation bias leads Austrians to see them as Truth, while Keysians remain skeptical.

When old ideas are adapted into a testable form they endow a great deal of prestige. There are all sorts of anecdotes about this happening, such as Henry Ford taking the idea of an assembly line from Oldsmobile and mixing it with his observations from a meat factory, to create the moving assembly line. The difference is that this is a testable idea that creates immediate results.

Comment author: Karl_Smith 03 March 2010 03:13:04AM 0 points [-]

So clearly adapting the new idea is useful.

However, it may also be the case that there is an old idea which if re-examined will be seen to be useful in and of itself.

The problem with the Austrians is that their ideas are being considered and they are being rejected. See Byran Caplan's Why I am Not an Austrian Economist. (link seems not to be working)