The latest Business Week cover story focuses on the debates and feuds among economists, and the impact of those debates on the current downturn.
I found the following passage particularly interesting:
The rap on economists, only somewhat exaggerated, is that they are overconfident, unrealistic, and political. They claim a precision that neither their raw material nor their skill warrants. Too many assume that people behave like the mythical homo economicus, who is hyperrational and omniscient. And they take sides in quarrels that freeze the progress of research. Those few who defy the conventional wisdom are ignored.
Critics are scathing. Nassim Nicholas Taleb, the scholar of rare events who wrote Fooled by Randomness and The Black Swan, says: “We have to build a society that doesn’t depend on forecasts by idiotic economists.” Says Paul Wilmott, a quantitative finance expert: “Economists’ models are just awful. They completely forget how important the human element is.”
Missing from the article ? unfortunately, especially given Wilmott?s comment about the ?human element? ? is any discussion of the Austrian school, including Mises? focus on Human Action.
