Monday, July 17, 2006

Dsquared Howls

In comments on this post, dsquared writes:
I saw the finest minds of my generation wrecked by the Solow model,
starving hysterical naked and calling a residual a theory.

1 comment:

dsquared said...

I honestly do think that Solow is the greatest of the neoclassicals. Anyone can do a linear regression that simply doesn't work, but it takes a genius to convert this failure into a failing of the world rather than the model, and something beyond a genius to basically set the agenda for a whole generation of macroeconomists, trying to find a reason why the Solow model doesn't fit the data other than the obvious one.