D. N. McCloskey and Stephen Ziliak have criticized economists and others for confounding statistical and substantive significance, and for committing the logical error of the transposed conditional. In doing so they sometimes misinterpret the function of significance tests. Nonetheless,...

This paper surveys the monetarist position on various aspects of American monetary policy in an informal way and provides the personal reactions of a participant observer in this debate. It emphasizes the intellectual milieu in which monetarism emerged, the background factors that facilitated...

Many leading methodologists have described the central role that Milton Friedman''s 1953 essay (henceforth referred to as F53) has played in methodological discussions. (See for instance Daniel Hammond, 1998; Kevin Hoover; 2001; Roger Backhouse 2002.) However, it does not necessarily follow that it has...

The differential response of cash reserves of member banks and nonmember banks not subject to the 1936-37 increase in reserve requirements is estimated to determine whether the 1937-38 recession was caused by the increase in reserve requirements. We identify 17 states that maintained constant...

This essay discusses some, but by no means all the important problems that arise in econometric testing of econometric models. Specifically, it disusses the reliabilty of the underlying data and their processing, the problem of relating theories and data, ceteris paribus conditions and...

When looked at individually there is little reason to think that economists lack integrity and are dishonest. Yet, when we look at academic papers written by economists we can see biases. This paper tries to reconcile these two observations by arguing that the constraints the profession sets on...

The standard loss function gives the same weight to positive and negative deviations from the output and inflation targets. This short note criticizes this symmetry assumption. If the period covered is long enough output growth in excess of the target, and often also inflation rates that are...

When a significance test fails to disconfirm a hypothesis economist often interpret this as evidence that this hypothesis is valid. Six such examples are cited from recent journals. But this is a misinterpretation of what significance tests show. Presumably this misinterpretation is founded on...

How justified is the charge that ideology strongly influences the allegedly objective opinions of economists? An analysis of a new survey of AEA members and of surveys by Fuchs et al of labor economists and public economists shows that value judgments and judgments about the government''s...

Close to half the California school districts let teachers choose whether to receive their salaries ten monthly payments or in twelve. Fisherine intertemporal maximization implies that they should choose ten payments and earn interest on their savings for their summer. But about half choose...