Switzerland to vote on banning banks from creating money

Re:Switzerland to vote on banning banks from creating money by mziel on Tuesday December 29, 2015 @07:03AM (#10806311)

Not the OP, but there's no such thing as proper experimental setup in economics (because there can't be). That's why using economic/econometric modelling for causal inference is the holy grail of the field.

Some approaches are:

- structural models (google Pearl)

- instrumental variables (google Angrist)

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Re:Switzerland to vote on banning banks from creating money by pratyushag on Tuesday December 29, 2015 @08:07AM (#10806482)

Not an expert but wouldn't randomized controlled trials (part of many economics papers) count as proper experimental setup?

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Re:Switzerland to vote on banning banks from creating money by MrApathy on Tuesday December 29, 2015 @08:46AM (#10806605)

Yes, many economics papers are at the intersection of economics and psychology with a focus on human behavior. One of the broad assumptions of economics is that individuals are largely rational, but controlled experiments sometimes show that people don't always act in their best interest.

But at a macro level, there are no controlled experiments. We can look toward "natural" experiments (e.g., wages and the labor rate of two border towns, where one is in a state that has raised minimum wage and the other has not), but there's nothing like the gold standard double blind randomized trial that you'd find in a drug study.

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Re:Switzerland to vote on banning banks from creating money by threatofrain on Tuesday December 29, 2015 @07:24AM (#10806381)

Thanks for the Judea Pearl reference.

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