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But Economics Is Not an Experimental Science

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  • Christopher A. Sims

Abstract

The fact is, economics is not an experimental science and cannot be. "Natural" experiments and "quasi" experiments are not in fact experiments. They are rhetorical devices that are often invoked to avoid having to confront real econometric difficulties. Natural, quasi-, and computational experiments, as well as regression discontinuity design, can all, when well applied, be useful, but none are panaceas. The essay by Angrist and Pischke, in its enthusiasm for some real accomplishments in certain subfields of economics, makes overbroad claims for its favored methodologies. What the essay says about macroeconomics is mainly nonsense. Consequently, I devote the central part of my comment to describing the main developments that have helped take some of the con out of macroeconomics. Recent enthusiasm for single-equation, linear, instrumental variables approaches in applied microeconomics has led many in these fields to avoid undertaking research that would require them to think formally and carefully about the central issues of nonexperimental inference -- what I see and many see as the core of econometrics. Providing empirically grounded policy advice necessarily involves confronting these difficult central issues.

Suggested Citation

  • Christopher A. Sims, 2010. "But Economics Is Not an Experimental Science," Journal of Economic Perspectives, American Economic Association, vol. 24(2), pages 59-68, Spring.
  • Handle: RePEc:aea:jecper:v:24:y:2010:i:2:p:59-68
    Note: DOI: 10.1257/jep.24.2.59
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    File URL: http://www.aeaweb.org/articles.php?doi=10.1257/jep.24.2.59
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    References listed on IDEAS

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    7. Mehra, Yash P, 1978. "Is Money Exogenous in Money-Demand Equations," Journal of Political Economy, University of Chicago Press, vol. 86(2), pages 211-228, April.
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    More about this item

    JEL classification:

    • B41 - Schools of Economic Thought and Methodology - - Economic Methodology - - - Economic Methodology
    • C01 - Mathematical and Quantitative Methods - - General - - - Econometrics

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