Tuesday, October 2, 2012

Matheus Grasselli — Further thoughts on mathematics and economics

Quantitative Finance: Foundations and Applications
Further thoughts on mathematics and economics
Matheus Grasselli | Associate Professor and Sharcnet Chair in Financial Mathematics working with the PhiMac group in the Department of Mathematics and Statistics at McMaster University, currently Deputy Director at the Fields Institute

I am substantially in agreement here. Of course, math modeling is necessary in economics, just as in any rigorous endeavor involving quantity and especially quantitative systems. It's just that a model's implications should be accurately represented in terms of the model's limitations. This has often been violated in policy recommendation and political advocacy.


JKH said...

I'd be curious if he had any discussions with the MMTers about the importance of double entry accounting logic, compared to higher mathematics, as they both relate to the economics profession and to understanding the monetary system in particular.

Has the necessary (accounting) been suppressed by the "sophisticated" (calculus, etc.)?

Does the mathematician assume such comparisons away as relatively unimportant, or at best a minor detail for future clean up in the operation of the economics profession? Or is there some acknowledgement of the importance of a particular kind of basic numeracy in the profession, apart from the beauty of such measures as Lebesgue integration?

Matheus said...

I often say that accounting is the quantum mechanics of economics, and I used to be a quantum theorist, so that should give a measure of the respect I have for accounting :)

JKH said...

Good news. Then you're on firm footing indeed. On that basis, you should unleash higher mathematical arrows in the quiver.