Must-Read: Paul Romer: Freshwater Feedback Part 1: “Everybody Does It”

Must-Read: Paul Romer: Freshwater Feedback Part 1: “Everybody Does It”: “The freshwater sympathizers agreed… that [Robert] Lucas and [Benjamin] Moll strategically refrained from verbal disclosures about some of the properties of the underlying mathematical formalism…

…Where we disagreed was whether this was a sign of behavior by the authors that is wrong. In effect, their response was caveat emptor; this is what all economists do…. We agreed about what about what Lucas and Moll did but we disagreed about what other economists do…. Freshwater economists believe that we are already in the noncooperative adversarial equilibrium, so it is wrong to express disapproval of economists who are simply engaging in the type of behavior that is rational in that equilibrium…. When the freshwater types say ‘everybody is following the adversarial method,’ what they may honestly be saying is that ‘everybody I know is following the adversarial method and they all believe that everyone else is doing this too.’… To me, the facts seem to be that freshwater economists are following a coordinated strategy based on the adversarial method yet that many other economists are still committed to the scientific method…

August 1, 2015

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