Q: Why did the economist cross the road?

If I recall correctly, I posted this on Positive Liberty. If I didn’t, I should have.

A: See Principle #4. (For more zany economics humor, see here.)

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12 Responses to Q: Why did the economist cross the road?

  1. AMW says:

    Am I being curmudgeonly to point out that economic profit is a profit of relative rather than absolute well-being?

  2. AMW says:

    economic profit is a profit measure of relative rather than absolute well-being?

    Fixed.

  3. James K says:

    I for one am perfectly happy to replace the macroeconomic principles with “Blah, blah, blah” 😉

  4. James Hanley says:

    DAR–You did, but I appreciate you posting it again.

    AMW–Perhaps, but I don’t see why you should let that concern you.

    JamesK–I get a fair number of economics students in my classes (although we have a minuscule econ department), and I like to ask them, “Micro or macro?” (that’s the total question). Nearly all of them say macro, which I find inexpressibly depressing.

  5. mcmillan says:

    Nearly all of them say macro, which I find inexpressibly depressing.
    I don’t know about economics students, but I wanted to to take an econ class as an elective and picked macro figuring it would be more applicable, though from what I’ve picked up on my own since I think I would have found the micro a lot more interesting.

  6. D.A. Ridgely says:

    I wasn’t even aware that undergrad econ majors could pick between micro and macro, assuming that the purpose of an undergraduate major was to give some understanding of the overall discipline.

    Speaking as someone who has never darkened the door of an economics class and whose ignorance of the discipline is therefore entirely self-inflicted, I’ve found price theory and its implications almost endlessly fascinating while most macro topics, especially once they get in the weeds, to be powerful soporifics. Besides, unless your ambition is to become an academic, a member of the Council of Economic Advisers or work for the Federal Reserve, what possible use, aside from grist for fiscal and monetary policy arguments, is macro?

  7. mcmillan says:

    Sorry I was unclear, I’m not an econ major, but wanted to have some exposure to it anyway.

  8. D.A. Ridgely says:

    No, you weren’t unclear. My first comment was in response to Mr. Hanley’s comment above about econ students at his college.

  9. James Hanley says:

    I guess I was too cryptic. The econ students have to take both micro and macro (both introductory and, I believe, intermediate). The question is to find out interests them more. To my way of thinking, macro is about collective outcomes, while micro is about individual decision-making. And for the life of me I just don’t get why anyone would find the former more interesting than the latter. I really don’t.

  10. James K says:

    At my university we had to do an introductory paper for micro and macro (well, I actually did the intermediate papers because I was comped the introductory ones), but I actually did macro right up to postgrad level. I say merely to make clear that my aversion to macro is not prejudice, but rather a well-considered dislike 😉

    The thing that got to me about macro is how intellectually barren it is. Growth theory is effectively useless (your country will either grow or not, and we don’t understand the mechanisms that make the difference), development economics is a list of things that don’t work, we don’t understand unemployment to any real extent and forecasting is the darkest of dark arts. The only thing from macro I ever thought was especially useful was stabilisation policy, and we all know how well that worked out.

    By contrast micro has the full gamut of market failures, trade theory, public choice theory and behavioural economics. I don’t blame the macro guys, their job is much harder. But so much of macroeconomics seems to be about justifying pre-held beliefs (see the debates about stimulus), and I’m not willing to slam my head into a brick wall (at least more than I do as a libertarian working for government).

  11. ppnl says:

    I’m no economist but as an analogy isn’t microeconomics like Newtonian physics in that it deals with a limited number of individual particles and the forces and masses involved? And macroeconomics is like the statistical treatment of vast numbers of particles in thermodynamics?

    If so then microeconomics can be seen as far more fundamental than macroeconomics. The problem is that it can be limited in scope. For example you can derive the gas laws from Newtonian mechanics but it isn’t pretty. It’s a matter of missing the forest for the trees.

    Some physicists like the fundamental questions of particle physics. Some like the more messy empirical questions in condensed matter physics.

  12. James K says:

    ppnl:
    This is true to an extent, but only an extent. Micro covers some pretty broad topics (trade theory or environmental economics, for example). And some of the most rigorously empirical work is in micro too. And theory vs. practice is orthogonal to the micro / macro split. I’m a policy economics, so I’m a practitioner rather than a theoretician, but I’m definitely a micro guy.

    But the reason the macro guys have so much trouble is that they’re trying to work on what may be the most complicated problems that are known without the benefit of being able to break things up. The human brain is the most complex object known to exist, and the global economy is no less than 6 billion human brains interacting in real time.

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