Econometric models are constructed with the idea that they can be substituted for authentic human action. Not surprisingly, they fail badly.
Original Article: Can Econometric Models Provide a Laboratory Setting for Economic Analysis?
Frank Shostak is an Associated Scholar of the Mises Institute. His consulting firm, Applied Austrian School Economics, provides in-depth assessments and reports of financial markets and global economies. He received his bachelor's degree from Hebrew University, master's degree from Witwatersrand University and PhD from Rands Afrikaanse University, and has taught at the University of Pretoria and the Graduate Business School at Witwatersrand University.
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