In this spirited and provocative book, Edward Leamer turns an examination of theHeckscher--Ohlin framework for global competition into an opportunity to consider the craft ofeconomics: what economists do, what they should do, and what they shouldn't do. Claiming "alifetime relationship with Heckscher--Ohlin," Leamer argues that Bertil Ohlin's original ideaoffered something useful though vague and not necessarily valid; the economists who later translatedhis ideas into mathematical theorems offered something precise and valid but not necessarily useful.He argues further that the best economists keep formal and informal thinking in balance. AnOhlinesque mostly prose style can let in faulty thinking and fuzzy communication; a mostly mathstyle allows misplaced emphasis and opaque communication. Leamer writes that today's model- andmath-driven economics needs more prose and less math. Leamer shows that the Heckscher--Ohlinframework is still useful, and that there is still much work to be done with it. But he issues acaveat about economists: "What we do is not science, it's fiction and journalism."Economic theory, he writes, is fiction (stories, loosely connected to the facts); data analysis isjournalism (facts, loosely connected to the stories). Rather than titling the two sections of hisbook Theory and Evidence, he calls them Economic Fiction and Econometric Journalism, explaining,"If you find that startling, that's good. I am trying to keep you awake."
Edward E. Leamer is Chauncey J. Medberry Professor of Management, Professor of Economics, and Professor of Statistics at the University of California, Los Angeles. He is the author Macroeconomic Patterns and Stories and other books.
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