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  • rmacculloch

In order to defend the RBNZ, the Herald diminished economics, by calling the subject "all political"

The NZ Herald's "Business Editor at Large", in order to defend the actions of our Reserve Bank these past years, had this to say about things written in the recent report authored by the former RBNZ Governor Graeme Wheeler & NZ Initiative fellow Bryce Wilkinson which critiqued the Bank's performance (along with several other Central Banks):


"Like all economics, it is political".


On and on the Herald goes with its lecture about the subject that I have studied for 30 years:


"Economics is not hard science. Hard science runs real-world experiments over and over in the lab, with controls in place, until it is accurate to irrefutable degrees".


Really? As a matter of public education, to write these kinds of gross generalizations is, in my opinion, a disservice to the readership of that paper.


I wonder whether the NZ Herald would like to write a follow-up article to "re-educate" its readers on the massive movement in economics these past decades to run "real world experiments", both "natural", and inside & outside labs with controls in place, like the medics do when testing drugs, to ensure the results are accurate to irrefutable degrees.


To recognize this extraordinary shift in economics to avoid it being labelled "all political", the 2019 Nobel Prize in Economics was made to Abhijit Banerjee, Esther Duflo and Michael Kremer “for their experimental approach to alleviating global poverty .. Their experimental work has changed the culture of economics .."


I'd suggest to the Herald's Owners & Editors they may like to read the article below, called "The Macroeconomist as Scientist and Engineer", by the writer of the world's most popular undergrad econ textbook & former Head of Harvard's Econ Department. Maybe they could also get in touch with my colleague, Ananish Chaudhuri, who is a Professor of Experimental Economics at the University of Auckland and ask for his views.


More generally, trying to diminish reports by eminent economists like Graeme Wheeler and Bryce Wilkson by labelling economics as "all political" does no-one any favors.


Sources:

https://www.nzherald.co.nz/business/liam-dann-making-sense-of-the-reserve-bank-pile-on/DR4CMKATUIXUOX4KZNE2TKJS7M/


https://scholar.harvard.edu/files/mankiw/files/macroeconomist_as_scientist.pdf


https://www.google.com/search?gs_ssp=eJzj4tLP1TdINjVIL0sxYPQSTMxLzMsszlBIzkgsTckoLcoEAJebCmQ&q=ananish+chaudhuri&rlz=1C1GCEA_enNZ796NZ796&oq=ananish+&aqs=chrome.2.69i57j35i39j46i512j0i512j0i30j0i15i30j69i59.4530j0j7&sourceid=chrome&ie=UTF-8