Wednesday, July 14, 2010

Why Am I Blogging?

[This is a long post, so feel free to jump to the end. You’ll miss a lot of fun stuff if you do though]

A few weeks ago, Kartik Athreya of the Federal Reserve Bank of Richmond delivered a harsh attack on the economics blogosphere:

Economics is Hard. Don’t Let Bloggers Tell You Otherwise

The following is a letter to open-minded consumers of the economics blogosphere. In the wake of the recent financial crisis, bloggers seem unable to resist commentating routinely about economic events. It may always have been thus, but in recent times, the manifold dimensions of the financial crisis and associated recession have given fillip to something bigger than a cottage industry. Examples include Matt Yglesias, John Stossel, Robert Samuelson, and Robert Reich. In what follows I will argue that it is exceedingly unlikely that these authors have anything interesting to say about economic policy. This sounds mean-spirited, but it’s not meant to be, and I’ll explain why.

The main problem is that economics, and certainly macroeconomics is not, by any reasonable measure, simple. Macroeconomics is most narrowly concerned with the tracing of individual actions into aggregate outcomes, and most fatally attractive to bloggers: vice versa. What makes macroeconomics very complicated is that economic actors... act...

...Beyond this, some may recall that Economics 101 is usually insistent on reminding students of the Fallacy of Composition: what is true for some may not be true for all. Much of macroeconomics is dedicated precisely making sure that when we talk about the “economy”, we don’t fall afoul of this fallacy. It is therefore not surprising that the majority of the training of new PhDs in their macroeconomic coursework is giving them a way to come to grips with the feedback effects that are likely present...

...The punchline to all this is that when a professional research economist thinks or talks about social insurance, unemployment, taxes, budget deficits, or sovereign debt, among other things, they almost always have a very precisely articulated model that has been vetted repeatedly for internal coherence...Comparing, even momentarily, such careful work with its explicit, careful reasoning, its ever-mindful approach to the accounting for feedback effects, and its transparent reproducibility, with the sophomoric musings of auto-didact or non-didact bloggers or writers is instructive. For those who want to really know what the best that economics has to offer is, you must look here. And this will be hard.

But why should it be otherwise? Why should anyone accept uncritically that Economics, or any field of human endeavor, for that matter, should be easy either to process or contribute to? To some extent, people don’t. Would anyone tolerate the equivalent level of public discussion on cancer research? Most of us readily accept the proposition that Oncology requires training, and rarely give time over to non-medical-professionals’ musings. Do we expect advances in cell-biology to be immediately accessible to anyone with even a college degree? Science journalists routinely cite specific studies that have appeared in specific journals. They generally do not engage in passing their own untrained speculations off as insights...

...So far, I’ve claimed something a bit obnoxious-sounding: that writers who have not taken a year of PhD coursework in a decent economics department (and passed their PhD qualifying exams), cannot meaningfully advance the discussion on economic policy. Taken literally, I am almost certainly wrong. Some of them have great ideas, for sure. But this is irrelevant. The real issue is that there is extremely low likelihood that the speculations of the untrained, on a topic almost pathologically riddled by dynamic considerations and feedback effects, will offer anything new. Moreover, there is a substantial likelihood that it will instead offer something incoherent or misleading. Note also that intelligence is not the issue. Many of those I am telling you not to listen to will more than successfully be able to match wits, in any generalized sense, with me. This is irrelevant. The question is: can they provide you, the reader, with an internally consistent analysis of a dynamic system subject to random shocks populated by thoughtful actors whose collective actions must be rendered feasible? For many questions, I and my colleagues can, and for those that the profession cannot, the blogging crowd probably can’t either.

As you can imagine, this paper provoked a firestorm among economics bloggers. Just a sampling:

  1. Mark Thoma
  2. Brad DeLong
  3. Scott Sumner
  4. Nick Rowe
  5. Tyler Cowen
  6. Arnold Kling
  7. Ryan Avent
  8. Matthew Yglesias
  9. Will Wilkinson
  10. Rajiv Sethi

Note that out of that list, 6 are full professors, one a noted author and PhD holder (Arnold Kling), and two are currently or formerly journalists and bloggers for the Economist magazine (Avent and Wilkinson), and know what they are talking about.

Out of the lot, I loved Nick Rowe’s riposte the best (it’s so good, I’m quoting in full):

The use of knowledge in blogging

The title is a nod to Hayek's famous essay "The use of knowledge in society".

I think that essay is the best thing Hayek ever wrote. But I don't really know that, because I haven't read everything Hayek ever wrote. Possibly nobody has read everything Hayek ever wrote (except Hayek, but he's dead). But there will be people reading this who have read more Hayek than me. Or just different things that Hayek wrote than me. And if you put together all the different things Hayek wrote that different people reading this have read, it will be more Hayek than I have read, and probably more than than any single one of those individuals has read. So if I've missed some even better writing by Hayek, I will be sure to hear about it in the comments. Or perhaps another blogger will post and say "Nick, you're wrong, you've missed...".

Which illustrates my point here, and Hayek's point in that essay. Individually, each of us knows little. But we know different things. The problem in society is to bring individuals' disparate knowledge together. Hayek's point is that a price system is a good way to bring disparate knowledge together. My point is that blogging is a good way to bring disparate knowledge together.

A simple theory of the failure of economics in the recent financial crisis is that macroeconomists didn't understand finance, and finance people didn't understand macro. (I have forgotten who came up with that theory, but someone reading this may remember, and will comment, which again illustrates my point). It's hard enough to know a lot about a lot, but the way in which academic conversations typically take place, through journal articles, books, and seminars, exacerbates this specialisation. Was it Deirdre McClosky who said that economics is a conversation (illustrating my point yet again, because someone will probably remember)? It is a conversation, but it's usually a conversation in which small groups of like-minded people huddle together to talk about the same narrow set of things. And there are often very long lags, like years, between someone saying something in one journal article and someone else replying in another. Those who are not ordained members of the academic cathedral aren't specifically excluded from the conversation, but are rarely invited, and it is usually hard for them to take part, so they rarely do. And usually only specialists understand the conversation anyway, in part because each huddle of specialists has their own gang code.

Blogging is a different form of conversation, and in some ways it is a better form of conversation. It's much easier to listen in and join in. Your physical location is almost irrelevant (time zones apart). Where you are employed doesn't matter (as long as you have time to join in). The time lags between getting an idea, writing it, publishing it, comments appearing, other bloggers posting in response, your replying to those comments and responses, are very short. It's like a 24-hour seminar held everywhere at once with a record of what everyone said, so you can even arrive late at the seminar and not miss anything.

And bloggers try to get as wide an audience as possible, so try to make their writing accessible to as wide an audience as possible, which means including non-specialists. (I don't really know why the difference in technology leads bloggers to try to reach a wider audience than authors of academic journals, but it seems to happen anyway, for whatever reason).

Comments are an integral part of blogging. Many of these potential benefits require comments if we want to turn them into actual benefits. When I post on some subject, there is almost always someone who knows more about some part of that subject than I do. Or maybe someone who knows more about most parts. And they can comment, and add their knowledge to the mix. And these are people in different specialisations, different countries, not in economics, who I have never met or have never heard of. People I would never get to meet if I gave a seminar. And they all get to meet me too, and each other. And commenters can argue among themselves, not just with me. And anyone can read them, as well as me. Knowing they are out there frees me to write about things where I know I don't know everything, or even much. And sometimes, it frees me just to try to ask a good question.

I'm not saying economists should abandon all other forms of conversation, and just blog. I don't need to argue that blogging is always better, just that it is sometimes better. There's a role for blogging, as well as other forms of economic conversation. Maybe even some of us, with a comparative advantage in blogging (we are really good at blogging, or really useless at anything else, take your pick) should specialise in doing it.

I have learned more from reading blogs, and from writing blogs, than I would have done otherwise. I have learned far more widely than I would have learned otherwise. Blogs are a great way to bring together the disparate knowledge of widely dispersed people. Before blogs I was in danger of becoming a burned-out ex university administrator. Now I haven't felt as intellectually alive since grad school.

(And the biggest danger to blogging is lack of civility, because it can cause the conversation to break up again into huddles of like-minded people.)

I was going to write something along these lines before I read Kartik Athreya on the subject. (And I would never have read him if it weren't for bloggers like Scott Sumner or David Beckworth responding to him.)

I’m going to echo what Nick is saying here: I don’t know everything, I’ll never know everything, but my journey through blogging has been incredibly illuminating and stimulating. I’ve learned more about economics in the past year and a half, than I did in 8 years of undergraduate and graduate work. I think Athreya is wrong on at least one very important point when he compares economics to the state of online commentary on other “sciences” – the reason why there is such a proliferation of commentary on economics and economic policy (informed or uninformed) is because it affects everybody, and we all have a vested interest in getting economic policies right. To paraphrase, economics is too important to be left to economists.

As to why I’m blogging, I set out my feelings on it in my very first post on this blog:

The idea behind starting this blog was really two-fold. The first was to have a way to put down and present my ideas, work in progress, and thoughts on the Malaysian economy. The structure of a blog would enforce a more disciplined approach to my explorations of economics, as in, I wouldn't put out anything that didn't come across as reasoned, coherent and backed by data. The second reason was to hopefully attract critiques and feedback, that would help me improve on my own understanding of the way the world works, or at least, this little corner of it.

So I hope you’ll join me on this conversation I’ve started, and we’ll all learn a little something along the way.


  1. keep on blogging bro!!!

    haven't missed a single post since u started..and this monkey lurve ur charts!!

  2. Mate : you run the best economics blog site in the country. Dont let anyone gets you down.
    One of these days, I am hoping for you to "pin down the fraudulent beast that is the NEP _ from the vantage point of Bumiputra in Commerce who are essentially handcuffed in not being able to exercise Price Discovery in all its degrees of freedom ". The incessant "advice" by the PM ( and past PM's ) for Bumiputra to "hold on to their assets " is antithesis to understanding yield curves.
    I am voting you to be Minister of EPU and go set the place right.

  3. You have provided much insight for people like me, who are not trained in economics but realize its importance in public policy and most other aspects of our lives. Truth be told, quality economics writing is ridiculously hard to find in this country and I have given up on mainstream media playing their roles in this. (We've got some libertarian and socialist blogs but those are too ideological to my liking).

    So please, please continue to blog. Haven't missed a post and don't plan on doing that any time soon!

  4. Damn proud of this hishamh.

    And i seldom swear.

  5. You blog because you have loads of economic data. That's good for people like me who deals with airy-fairy theories. Keep up the good work, hish.

  6. I honestly didn't expect much response to this post, but thank you everyone.

    I had no intention of stopping blogging, but I'm more conscious now of trying to make what I write a little more accessible and understandable from a lay person's point of view.

    Something that's bothered me is the relative lack of participation in the public discourse on economic matters by the academic community. Which is one of the other reasons why I started this blog, which is to help fill that silence, hopefully with something worthwhile to say.

    So again, thanks everyone.

  7. Sir,

    Of course economics is hard. For the past few postings, I don't really understand what you are saying. I'll keep reading nevertheless