Mariano Torras, PhD, professor and chair of the Department of Finance and Economics, authored a letter commenting on an editorial asserting that it overstates the importance of economic forecasting.
Mariano Torras is a Professor and Chair of the Finance and Economics Department at the 麻豆直播 Robert B. Willumstad School of Business.
I believe the editorial (FT View, May 15) overstates the importance of economic forecasting. To say that in uncertain times economic forecasting is 鈥減erilous鈥� suggests that much is staked on the accuracy of the forecasts.
Not so. Much of the public is quite aware that forecasters are frequently far off the mark. The fact that many retain their jobs despite poor performance might simply indicate that erroneous forecasts are understood to be the norm. The real 鈥減eril鈥� in today鈥檚 uncertain times concerns the confluence of several major crises 鈥� eg climate change, mental illness, pandemic risk, spiralling inequality 鈥� that will undoubtedly produce adverse economic effects. To focus on macroeconomic statistics (the 鈥渢rees鈥�), as is the forecaster鈥檚 wont, misses secular trends in these far more consequential developments (the 鈥渇orest鈥�).
Perhaps it is time to discard the notion that economics is a predictive science and rely more on educated common sense to help navigate the world鈥檚 complexities.
Read the from May 15, 2023.
