Mathematical Models and Economic Forecasting: Some Uses and Mis-Uses of Mathematics in Economics.

We consider three ‘cases studies’ of the uses and mis-uses of mathematics in economics and econometrics. The first concerns economic forecasting, where a mathematical analysis is essential, and is independent of the specific forecasting model and how the process being forecast behaves. The second...

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Autor principal: Hendry, D
Formato: Working paper
Idioma:English
Publicado em: Department of Economics (University of Oxford) 2011
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author Hendry, D
author_facet Hendry, D
author_sort Hendry, D
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description We consider three ‘cases studies’ of the uses and mis-uses of mathematics in economics and econometrics. The first concerns economic forecasting, where a mathematical analysis is essential, and is independent of the specific forecasting model and how the process being forecast behaves. The second concerns model selection with more candidate variables than the number of observations. Again, an understanding of the properties of extended general-to-specific procedures is impossible without advanced mathematical analysis. The third concerns inter-temporal optimization and the formation of ‘rational expectations’, where misleading results follow from present mathematical approaches for realistic economies. The appropriate mathematics remains to be developed, and may end ‘problem specific’ rather than generic.
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spelling oxford-uuid:b4200a53-ff10-481c-b1b3-d4bd4bb12d8b2022-03-27T04:23:56ZMathematical Models and Economic Forecasting: Some Uses and Mis-Uses of Mathematics in Economics.Working paperhttp://purl.org/coar/resource_type/c_8042uuid:b4200a53-ff10-481c-b1b3-d4bd4bb12d8bEnglishDepartment of Economics - ePrintsDepartment of Economics (University of Oxford)2011Hendry, DWe consider three ‘cases studies’ of the uses and mis-uses of mathematics in economics and econometrics. The first concerns economic forecasting, where a mathematical analysis is essential, and is independent of the specific forecasting model and how the process being forecast behaves. The second concerns model selection with more candidate variables than the number of observations. Again, an understanding of the properties of extended general-to-specific procedures is impossible without advanced mathematical analysis. The third concerns inter-temporal optimization and the formation of ‘rational expectations’, where misleading results follow from present mathematical approaches for realistic economies. The appropriate mathematics remains to be developed, and may end ‘problem specific’ rather than generic.
spellingShingle Hendry, D
Mathematical Models and Economic Forecasting: Some Uses and Mis-Uses of Mathematics in Economics.
title Mathematical Models and Economic Forecasting: Some Uses and Mis-Uses of Mathematics in Economics.
title_full Mathematical Models and Economic Forecasting: Some Uses and Mis-Uses of Mathematics in Economics.
title_fullStr Mathematical Models and Economic Forecasting: Some Uses and Mis-Uses of Mathematics in Economics.
title_full_unstemmed Mathematical Models and Economic Forecasting: Some Uses and Mis-Uses of Mathematics in Economics.
title_short Mathematical Models and Economic Forecasting: Some Uses and Mis-Uses of Mathematics in Economics.
title_sort mathematical models and economic forecasting some uses and mis uses of mathematics in economics
work_keys_str_mv AT hendryd mathematicalmodelsandeconomicforecastingsomeusesandmisusesofmathematicsineconomics