The Power of Assumptions
Yongchen Zou
.
DOI: 10.4236/me.2011.24056   PDF    HTML     5,452 Downloads   8,976 Views   Citations

Abstract

This paper examines computational merits provided by assumptions made in scientific modeling, especially regression, by trying to exhibit abstractly a model deprived of those assumptions. It shows that the principle of Occam’s Razor has been mistakenly used as model developers’ justification to keep scientific models “as simple as possible”, and that the cost of inflating computability is truncation of model robustness.

Share and Cite:

Y. Zou, "The Power of Assumptions," Modern Economy, Vol. 2 No. 4, 2011, pp. 514-520. doi: 10.4236/me.2011.24056.

Conflicts of Interest

The authors declare no conflicts of interest.

References

[1] K. R. Popper, “The Open Society and Its Enemies, Volume Two: Hegel and Marx,” Routledge Classics, New York, 1945.
[2] K. R. Popper, “The Poverty of Historicism,” Routledge Classics, New York, 1988.
[3] N. N. Taleb, “The Bed of Procrustes: Philosophical and Practical Aphorisms,” Random House, 2010.
[4] D. N. Gujarati, “Essentials of Econometrics,” 2nd Edition, Mcgraw-Hill College, New York, 1998.
[5] W. S. Robinson, “Ecological Correlations and the Behavior of Individuals,” American Sociological Review, Vol. 15, No. 3, 1950, pp. 351-357. Hdoi:org/10.2307/2087176
[6] L. Goodman, “Ecological Regression and the Behavior of Individuals,” American Sociological Review, XVIII, Vol. 18, 1953, pp. 663-664.
[7] A. Lichtman, “Correlation, Regression, and the Ecological Fallacy: A Critique,” The Journal of Interdisciplinary History, Vol. 4, No.3, 1974, pp. 417-433. Hdoi:org/10.2307/202485
[8] F. E. Kydland and E. C. Prescott, “The Computational Experiment: An Econometric Tool,” Journal of Economic Perspectives, Vol. 10, No. 1, 1996, pp. 69-85. Hdoi:org/10.1257/jep.10.1.69
[9] Smets, Frank and R. Wouters, “An Estimated Dynamic Stochastic General Equilibrium Model of the Euro Area,” Journal of the European Economic Association, Vol. 1, No. 5, 2003, pp. 1123-1175. Hdoi:org/10.1162/154247603770383415
[10] C. A. Sims, “But Economics Is Not an Experimental Science,” Journal of Economic Perspectives, Vol. 24, No. 2, pp. 59-68. Hdoi:org/10.1257/jep.24.2.59

Copyright © 2024 by authors and Scientific Research Publishing Inc.

Creative Commons License

This work and the related PDF file are licensed under a Creative Commons Attribution 4.0 International License.