Jason Smith — Success?

A few days ago, I had a back and forth with Narayana Kocherlakota on Twitter where he called economic forecasting of inflation a "success":

Information Transfer Economics
Success?
Jason Smith

Andrew Lainton — Why an Economic Equilibrium is not Like a Physical Equilibrium

Conservative v. dissipative systems, and information transfer.

Decisions, Decisions, Decisions
Why an Economic Equilibrium is not Like a Physical Equilibrium
Andrew Lainton

Jason Smith — Should the left engage with neoclassical economics?

Getting the left up to speed by understanding information. There's a lot of good stuff in this post.

Information Transfer Economics
Should the left engage with neoclassical economics?
Jason Smith

Jason Smith — What is and isn't economics?

It's probably hubris for a physicist to say what is or isn't economics, but I'll have a go anyway.

Information Transfer Economics
What is and isn't economics?
Jason Smith

Jason Smith — Statistical mechanics of ants

The decision process in each tiny (but still to complex to model with a computer!) ant brain of what force level to let go and "play dead", to stick together or not, is aggregated into a single number: a viscosity coefficient.

Footnotes:

[1] Recessions and other mass coordination events are the exception, but most of the time, the economy is not in a recession.

The footnote is the reason that macroeconomics is devilishly difficult with respect to prediction. Departures from trend are most significant for prediction and therefore policy, applied macro being political economy. "External shock" (external to the model) is not a satisfying explanation, and it is an admission of failure at prediction, that is, that assumptions are too restrictive to be useful in generating dynamically accurate representational models.

Traders face similar issues in assessing the likely run of a trend (opportunity space), turning points (timing) and the speed and amplitude of swings (volatility). Even though financial investors are dealing with longer term, similar issues apply.

Information Transfer Economics
Statistical mechanics of ants
Jason Smith