### Grant McDermott

Assistant Professor
Dept. of Economics
University of Oregon

# Another post on empirics (and a priorism)

I was away last week in Amsterdam taking part in The Econometric Game, a competition involving 30 universities from around the world. Despite the... hmmm... dour reputation of econometric get-togethers, this ended being a very enjoyable and social event. I can certainly recommend Amsterdam to any would-be travellers too. It's relatively small, but built around tourism and there's a great deal more to the city than stoner coffeehouses and sex shops.[*]

Unfortunately, my team didn't make the finals and I think that some inexperience caught us out here, since our university decided to send an all new side this year after reaching the finals in two of the last three events.[**] The time pressure of putting together a complete academic paper in one day $$-$$ using some technical routines that you aren't necessarily familiar with $$-$$ is something that's hard to prepare for. I do think that our analysis was pretty respectable and we certainly ticked all the boxes highlighted by the case makers after the submission. However, we probably let ourselves down by not "selling" our results well enough in the conclusion and discussion parts of the paper. Nonetheless, definitely a good experience overall and congratulations to the top three teams: 1) University of Copenhagen, 2) Aarhus University, and 3) Harvard University. Danes ruling the roost!

The case topic itself was to investigate "the effect that maternal smoking during pregnancy has on birthweight". Of course, maternal smoking is associated with a range of afflictions in addition to low birthweight and premature birth; from clefts to intrauterine hypoxia. However, the long-term economic implications of low birthweight (and, thus, the causal impact of smoking) are far more important than many people realise. All other things being equal, low birthweight babies will on average suffer higher mortality rates, be more likely to have cognition and attention problems, and be more prone to unemployment and lower wage earnings in later life. (For example, see Black, Devereux and Salvanes; 2005.)

Some of you may remember that I have actually discussed the issue of maternal smoking on this blog before. Of course, that post had very little to do with empirics and was instead aimed at exploring the philosophical ramifications of allowing pregnant mothers to smoke. In essence, it was a thought-experiment on whether it would be morally permissible to ban mothers from smoking (if this were somehow enforceable). The ensuing comments thread became quite excitable, so take a look if you want to see some divided opinions.
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[*] Mind you, these are freely on display as well. Like any good boy from Cape Town, I am strongly in favour of dope legalization. Holland's drug policy is more complex than simple soundbites, but far superior to what one finds elsewhere.
[**] The coffeeshops had nothing to with it ;)

...

Having returned from Amsterdam, I saw that my mate Russell had left a comment under an older post concerning the paleo diet's strong popularity within libertarian circles. As a follower of the praxeological method, Russ suggests that I am "asserting a false choice" by claiming that that there is a marked inconsistency in the way that (some) libertarians invoke the scientific method and empirical evidence in finding support for their preferred worldview. You can see my reply here, which concludes: My broader point is that the praxeological fixation among its proponents has created a hermetic seal; a complete aversion to empirical methods that far surpasses the limits of what praxeology could (conceivably) claim to hold sovereignty over.

The language is perhaps a bit dramatic, but still accurate I think. A more specific point that I wanted to make is that if you are going to claim that econometrics and other empirical methods in economics hold no validity because of reasons X, Y and Z... Then it it behoves you to be equally dismissive of their applications to medical studies of the type that Gary Taubes (go-to-guy for the paleo crowd) advocates. For these too seek to identify causal effects in a world characterised by complex interactions between people and their changing environments.