Bryan Caplan  

Aphorism of the Day

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Notes from My Tea Party Talk... The Size of Monetary Stimulus ...
An economic model is just a story without any holes in it.  A good economic model is a credible story without any holes in it.

P.S. Why The Lord of the Rings is a great story but a terrible model.


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COMMENTS (3 to date)
Foobarista writes:

...and here's why Lord of the Rings makes a truly awful AD&D campaign, even though it arguably kicked off the whole D&D thing...

http://www.shamusyoung.com/twentysidedtale/?p=612

Tracy W writes:

Normally I'm the one defending economics, but how many economics models have no holes in them? Comparative advantage is the only one that springs to mind. Everything else, even free trade, people quarrel with and you wind up arguing about empirical stuff.

Norman writes:

Tracy, people quarrel with the credibility of the assumptions used. But given the assumptions, the models work, no logical gaps or holes. The quarrels are about credibility.

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