Talking about models

Talking about models is one of the areas where economists often come unstuck. Why do we use models? How do we use them? How can we explain them?

To quote Ragnar Frisch, winner of the first Nobel Prize in Economics “No amount of statistical information, however complete and exact, can by itself explain economic phenomena. ... we need the guidance of a powerful theoretical framework. Without this no significant interpretation and coordination of our observations will be possible.”

Start with aa simple model that focuses on the key behaviours and outcomes - ("All things being equal, the simplest solution tends to be the best" William of Occam).

Think about a map - a simple map is often more useful than a more realistic and complicated map. Consider the London Underground map, it is an abstraction from reality, it is incorrect, but it is much more useful for getting around on the underground than a realistic and detailed map.

Communicating Uncertainty in Policy Analysis

False certainty will lead to bad policy. If policy makers understand the nature of certainty they can make better policy.

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Dismal ignorance of the “dismal science”—a response to Larry Elliot

Orazio AttanasioOriana BandieraRichard BlundellStephen MachinRachel Griffith and Imran Rasul respond to a column in the Guardian column that  reproduced some classic misconceptions about what economists actually do.

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Useful Links

Michele Belot

The Trouble with Fake News

Michele Belot, Professor of Economics at the European University Institute, argues that the problem posed by ‘fake news’ lies not in fake facts, which can be easily checked, but in the misleading interpretation of those facts.

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The financial skills of adults across the world

A report by the University of Cambridge Faculty of Education

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Indiana University School of Law logo

Reaching the Visual Learner: Teaching Property Through Art

How to teach visual learners

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Understanding Uncertainty Logo

Understanding Uncertainty

Blog of the Winton programme for the public understanding of risk at the University of Cambridge

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Government Statistical Service

Government Statistical Service

Guidance for communicating quality, uncertainty and change

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Jacob Clifford

Jacob Clifford

Videos to help people understand economics

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