Category Archives: Clippings

Eugene Fama should know better

Brad DeLong blasts Eugene Fama for his manifest failure to understand the investment-savings identity: Fama… thinks that “investment” means “growth in the value of the capital stock.” He simply does not understand what the NIPA investment concept is, or that … Continue reading

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Dani Rodrik on stocks vs. flows

Dani Rodrik writes: Suppose you read the following statement: In 2006 the measured economic output of the entire world was around $47 trillion. The total market capitalization of the world’s stock markets was $51 trillion, 10 percent larger…. Planet Finance … Continue reading

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A blast from the past…

…from 1989, to be precise. The band is Noir Désir, and the song is called “Aux sombres héros de l’amer”.

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Objective measurement of subjective well-being

Justin Wolfers writes on Freakonomics: Let’s see how it checks out, updating my earlier analysis of daily data on life satisfaction through 2008, courtesy of the Gallup-Healthways Well-Being Index… Not only has happiness declined during this recession, it has declined … Continue reading

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BMJ goes myth-busting

The British Medical Journal recently did some serious myth-busting (see part one and part two). Apparently, all of the following are myths: Sugar causes hyperactivity in children Suicides increase over the holidays Poinsettia is toxic Not wearing a hat causes … Continue reading

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Of ignorance and knowledge

Shamelessly copied from Obsidian Wings: What Do You Mean ‘We’, White Man? Robert Samuelson has an infuriating op-ed in today’s Washington Post. It’s called “Humbled By Our Ignorance”: “It’s the end of an era. We know that 2008, much like … Continue reading

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Brad DeLong on Keynes and terminology

But Keynes Is Saved by Walras’s Law Tyler Cowen writes: Keynes’s General Theory, chapter six: in part ii the bombshell comes, unannounced. Keynes decides that he will declare savings to be a “mere residual.” Consumption and investment alone will determine … Continue reading

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Dani Rodrik in Ethiopia

Dani Rodrik writes: Self-discovery in practice It is remarkable to see something in theory work so well in practice. Ricardo Hausmann and I wrote a paper several years ago called “Economic Development as Self-Discovery,” where the idea was that entrepreneurship … Continue reading

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Excel’s faulty statistics: a bibliography

McCullough, B.D. (2002). Proceedings of the 2001 Joint Statistical Meeting [CD-ROM]: Does Microsoft fix errors in Excel? Alexandria, VA: American Statistical Association. McCullough, B.D. (1999). Assessing the reliability of statistical software: Part II. The American Statistician, 53(2), 149-159. McCullough, B.D. … Continue reading

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Behavioral finance marches on

Quant. Shop Offers Heady Long/Short Hedge Fund December 17, 2008 | Source: FINalternatives Santa Monica, Calif-based MarketPsy has launched a quantitative hedge fund that incorporates psychology into its trading strategy. So far, the firm’s Long-Short Fund has outperformed its discretionary … Continue reading

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