Paul Samuelson: Difference between revisions

"One must not expect to be able to make the naive measurements that untutored common sense always longs for." -P. Samuelson (w/ Swamy) 1974

3:23 AM · Dec 14, 2009

"[W]e must not be bemused by the undoubted elegances...of the homothetic theory. Nor should we shoot the honest theorist." -Samuelson&Swamy

3:25 AM · Dec 14, 2009

Paul Samuelson told me these lines of his would ward off any detractors who did not understand what Lie groups and gauge theory could solve.

3:27 AM · Dec 14, 2009

I think many scientists would have found Paul Samuelson a formidable fellow scientist, technically knowledgable far beyond economics. I did.

3:32 AM · Dec 14, 2009

“Would you bet a cigar on that?” -John Von Neumann cowing Paul Samuelson

10:38 PM · Dec 15, 2009

"Some day when I pass through St Peter’s Gates I do think I have 1/2 a cigar still coming to me" -P Samuelson now looking for J von Neumann

10:42 PM · Dec 15, 2009

.@riemannzeta: Samuelson's economics is to Newtonian physics what gauge theoretic economics is to Einstein/Yang-Mills http://bit.ly/PSINAE

4:27 PM · Dec 22, 2009

2010Edit

In Samuelson's Nobel lecture, he struggles with integrability. I wish there was more there as curvature tensors measure it's failure.

12:37 PM · Feb 4, 2010

How crazy is economic gauge theory? Paul Samuelson liked it because he was looking for it in 1950(!): http://bit.ly/c6vILI (e.g. see fig 4).

2:58 AM · Aug 4, 2010

ANNOUNCEMENT: I head next week to @UChicago for 5 days (Nov. 8-12) at the request of its storied Department of Economics to present our theory that all of economics is based on the wrong version of the differential calculus.

Importantly, this error afflicts Inflation & the CPI.

5:57 PM · Nov 4, 2021

Hi Eric, where can I find your calculations, data, and conclusions on what the real inflation and CPI numbers are?

11:19 AM · Nov 5, 2021

Weird question. You seem to have me confused for the BLS. I don't take in Data. I don't have a staff or a budget. You're assuming that I have the 'Real Inflation & CPI numbers'. I don't.

This is about not even having a correct *theory* to calculate. What we corrected was theory.

11:40 PM · Nov 4, 2021

Just to give you an idea:

11:44 PM · Nov 4, 2021

So if you have the correct theory then why wouldn't you be able to calculate the correct results from the existing input data available?

11:47 AM · Nov 5, 2021

I didn’t say what you said. I said there was a wrong theory for CPI. We corrected that theory.

The issue of how to implement a theory in practice leases to different data being collected and different aggregations. For a different theory, you would collect different data.

1:00 AM · Nov 5, 2021

As an example. The Boskin commission gave a single illustrative example in their report using two goods, chicken and beef. They gave prices but not ordinal utility. Here is the COL answer assuming Cobb-Douglas and Linear interpolation of all quantities. They could not compute it.

1:07 AM · Nov 5, 2021

The reason they had no theory to cover it was because the C-D exponent changed. And there is a claim that no extension of the Konus COL exists for dynamic tastes.

Hope that helps with your confusion. Be well.

1:09 AM · Nov 5, 2021

*leads not leases in the above.

1:10 AM · Nov 5, 2021

Yea I understand that and find your points interesting. So I would like to understand how we would go about invalidating the traditional theories by collecting and analyzing the correct data. I don't think those tweets answer that. I get your hypothesis.

1:21 AM · Nov 5, 2021

Well I think the BLS should begin by questioning their own premises. They say they work in a COL framework. They do not. They do not share how they construct the representative consumer. How they estimate substitution if they don’t have preference data. It’s fake and a mess.

1:27 AM · Nov 5, 2021

If they are going to do COLas they should estimate preferences. If they aren’t they should do mechanical index theory.

But I would use a bunch of that money to develop a research program on preference collection/imputation for substitution bias if I was running a COL shop.

1:29 AM · Nov 5, 2021

Ok how many researchers would you need? Is the average salary $300k? What are the non-labour costs needed? Could this be done in 1 year?

Could we get this done with let's say $10m? Is $609m necessary for a MVP?

1:33 AM · Nov 5, 2021

I am not sure. But the first question I have is do we believe ordinal preference maps are constructable from revealed preference.

1:59 AM · Nov 5, 2021

Well if we were to get you started with all the resources necessary, wouldn’t the assumption be yes to apply your theory?

2:02 AM · Nov 5, 2021

I would take a look at Paul Samuelson’s Nobel lecture. He goes into depth on revealed preference and preference field non-integrability. I think we have lost track of the fact that integrability of tastes was never actually settled except by fiat. Will talk on this.

9:20 PM · Nov 5, 2021

@swede_irish I don’t know what those words mean at a *technical* level. I get what they are meant to suggest, obviously. But I don’t think that is what CPI-U actually is in a meaningful technical way.

6:21 AM · Nov 8, 2021

@swede_irish Wow. Uh. If I don’t, who does? E Diewert? B Balk? Who?

6:52 AM · Nov 8, 2021

@swede_irish As for “Stay in your lane”…ha. Economists should listen. May I recommend “Economic Imperialism”?

No thanks. No one should put up with expert arrogance masquerading as understanding. I freely admitted I don’t understand CPI-U. You pretended that you did. That’s not worth much..

7:01 AM · Nov 8, 2021

@swede_irish I am going to sleep soon. But I spent years trying to understand what economists thought they were doing. I came to the conclusion that they didn’t know themselves. And they were often forced to admit this based on technical questioning. It’s not that they have this down solidly.

7:12 AM · Nov 8, 2021

@swede_irish “More heat than light” is PM’s book which is fairly idiosyncratic, but has the right flavor. Samuelson’s Nobel lecture on integrability is another source. Von Weitzacker is yet another source admitting the issues from within the field: you can’t restrict welfare theory as we do.

7:31 AM · Nov 8, 2021

2022Edit

Well let us give economists their due.

The most cogent economists on the subject of price indices include:

Bert M Balk (Statistics Netherlands)
Carl Christian von Weizsäcker
Paul Samuelson and S Swamy
Amartya Sen
Franklin Fisher and Karl Shell
and Erwin Diewert (very uneven).

11:53 PM · May 10, 2022

I cannot be objective about my collaborator @PiaMalaney, but I can say that it would be a good idea to review her critique by the Boskin commissioners, who I found to represent the “Psst. Just tell us what you need the number to be and we can help you out.” school of economics.

11:59 PM · May 10, 2022

In short, there are economists who believe in measuring inflation, who struggle to understand the issues…and there are economists who work backwards from the political masters they serve. This is a rough guide to both camps.

The researchers tend to lose to the political types.

12:02 AM · May 11, 2022

“None of the usual criteria that **real** experts use says that we are in a recession.” - Prof. @paulkrugman

Have you dealt w/ economics professionally as an academic from another field? If not, it’s exactly like this: “Reason, fact, analysis, total bullshit, fact, a lie, fact.”

1:05 AM · Aug 1, 2022

Tom Elliott

@tomselliott

CNN's @brianstelter: "Can we dispense with the recession debate? Are we in a recession, and does the term matter?

Former Enron adviser @PaulKrugman: "No, we aren’t and no, it doesn’t."

4:13 PM · Jul 31, 2022

In fact the truths, insights, facts, analysis, etc. are pretty compelling. And they are the majority of what economists circulate.

And then the conversation turns, and out comes the superior dismissive insufferable gaslighting.

And you think: “Why ruin analysis with psychosis?”

1:05 AM · Aug 1, 2022

I was lucky enough as a younger man to get to know Ken Arrow and Paul Samuelson slightly. They didn’t have this trait. Talking to Arrow or Samuelson was like talking to a research mathematician, biologist or physicist at the time. It wasn’t switching between reality & propoganda.

1:05 AM · Aug 1, 2022

So my model is that Economics really changed. The old guys who did the most to lay the foundations were a lot less high on their own supply. They welcomed interactions with other disciplines. It feels like the 1970s transformed economics into something less intellectually honest.

1:14 AM · Aug 1, 2022

Great question. Inflation is SUPPOSED to be a group valued field. In the case of bilateral trade it’s an element of GL(2,R) although the economists haven’t gotten there yet. But it is mostly not a field on Geography. It’s a field on path, Loop, preference and geographic spaces.

4:05 PM · Nov 6, 2022

invisible_college

@invisi_college1

I have heard you say inflation looks more like a heat map, than a single number. Would you say a heat map by both geography and product? Good morning

2:21 PM · Nov 6, 2022

Pirate Hodl

@pirate_hodl

And preference space is unknowable without just letting a free computation run. Anything else involves some humans telling other humans what their preferences must be.

4:34 PM · Nov 6, 2022

Sure! And as Samuelson said, it may not even be integrable. And it may be that you are mixing stocks and flows. Etc. But then don’t say you are implementing Konus COLAs while pretending that mumbling “ superlative Index number are exact for flexible functional forms” makes sense.

4:39 PM · Nov 6, 2022

The main issue here is simply super invidious priestly bull shit used to cover the destruction of people’s lives. Thanks!

4:40 PM · Nov 6, 2022

Pirate Hodl

@pirate_hodl

Wow, I'm going to have to Google half of that. I feel too dumb for this conversation. Am I reading correctly that the above tweet is sarcasm, and you're saying there's a deeper intellectual problem here?

4:43 PM · Nov 6, 2022

They have two black boxes. One is called CPI construction. One is called the Fed. The theory is a narrative. The narrative doesn’t match the actions.

4:46 PM · Nov 6, 2022

2023Edit

Nathan Barnard

@NathanB60857242

who's your favourite economist?

11:07 AM · Jan 30, 2023

François Divisia or Ken Arrow or Paul Samuelson or Satoshi or Ronald Coase etc.... would be easy to defend.

But Graciela Chichilnisky or Bert Balk would be more interesting offbeat choices I could defend. I don't think they got their due for what is coming in mathematical econ.

5:01 AM · Jan 31, 2023

Andromeda

@gmlfle

I would’ve guessed you liked Ken Arrow, Eric. The work for which he won a Nobel Prize in 1972, seems right up your street. Tbh having learnt some of Ken Arrows works in my final year of my economics degree, it completely changed the way I looked at elections + institutions.

11:07 AM · Jan 30, 2023

He was very supportive of me. If I had to make a single choice it might be him or Samuelson.

2:24 AM · Feb 1, 2023

Martin Bauer

@martinmbauer

Yes, but when I said ‘brightest minds’ I meant it.

8:43 PM · Feb 13, 2023

Arrow, Frisch, Samuelson, VonNeumann, Nash, Friedman, Smith, Mill, Divisia, Coase, Marshall, Fisher, Debreu, Tinbergen, etc.

I have deep issues with economics. But I don’t think I understand your point.

8:43 PM · Feb 13, 2023

2024Edit

You mean the Friedman money and banking seminar where @haralduhlig was the principal critic who then started to understand only after the seminar?

I’d be happy to do this with Harald on board. It might motivate us to finish our work that happened after the seminar.

I don’t know you @florianederer. But I do know you as a consistantly bad actor. As you may know, the most famous Chicago seminar was that of Coase. Where the seminar became famous *because* Chicago got it wrong. And it took much longer to see the argument.

Harald got it wrong during the seminar. And I also know that Chicago, at least historically, eventually usually gets it right. But I’d be happy to structure a bet that would penalize your being a bad actor.

I write this not because I care about your opinion. But because Cliff is a colleague. And, at least here, you are a troll. Let’s figure out if there is a mutually agreeable bet that gives me an ability to inflict a cost on this behavior of yours.

And one last point. Arrow and Samuelson were both supportive of this work. But perhaps you see what they do not. Who knows. You are certainly very sure of your position. As am I.

One of us is wrong.

10:33 PM · Aug 13, 2024

2025Edit

Woah. Slow down. Because then we would be stuck with American STEM workers. Ya know, those lazy, stupid, unmotivated can't do, low-IQ pseudoscientific stoners who play video games all day long and can't be bothered to crack a book.

It would be like being stuck with R. Feynman, J Watson, M Gell-Mann, K. Arrow, G. Hopper, JR Oppenheimer, S. Weinberg, P Samuelson, M. Nirenberg, J Lederberg, S. Smale, D. Mumford, J Doudna, S. Coleman, B. McClintock, and M. Ptashne all over again. And we can all agree that we need the best and the brightest.

;-)

cc: @VivekGRamaswamy.

3:50 PM · Apr 9, 2025

Margot Cleveland

@ProfMJCleveland

Just waiting for Trump to counter China's latest move by pulling all the student visa and sending all the spies home.

2:16 PM · Apr 8, 2025

Let me be clear. This post is not targeted at foreign born STEM. [My apologies to those of you who know me well on this point for decades. But it is always deliberately misinterpreted by those who seek to depress salaries.]

Read carefully, it's target is American STEM employers who lie as a way of life about the quality of our own STEM people in order to gain access to foreign labor.

My contention is that we destroy American STEM which is the best in the world because it is expensive, irreverant and high risk/high return.

If you want to go shopping abroad for future americans who are expensive, irreverant and high risk/high return, let me know and I will design your labor market.

But I will never put up with Americans who misportray just how good U.S. STEM really is in order gain access to oceans of plient low variance high value labor.

4:00 PM · Apr 9, 2025

Yes. I’m saying that the Jim Simons, Richard Feynman, Jim Watson, Steven Weinberg, Sidney Coleman, Ken Arrow, Linus Pauling, Isadore Singer, Joshua Lederberg, Steve Smale, Paul Samuelson, Mark Ptashne, John Milnor, model of homegrown American scientific genius is being destroyed.

8:17 AM · Nov 15, 2025

Is anyone concerned about this? It sure doesn’t seem it.

Science needs academic freedom. It needs resources. It needs independence.

Fauci and Collins would have been impossible if we were healthy.

It is not safe to make scientists into mere employees.

It’s way too dangerous.

8:17 AM · Nov 15, 2025

It’s as if we, the U.S., hate being the worlds premier homegrown scientific community. All it takes is reversing self inflicted damage. That’s it. That’s all.

We seem to hate our own scientists.

It makes no sense. At least to me.

8:33 AM · Nov 15, 2025

Unlike Paul Samuelson & Ken Arrow, Gary Becker was cut from different cloth. He reminded me of my dealings w/ Lenny Susskind, Larry Summers, Brad Delong, Jagdish Bhagwati, Ed Witten, Mildred Dresselhaus & others, so possessed by ideology that academic reason could just vanish.

11:49 PM · Dec 8, 2025

Robert P. Murphy

@BobMurphyEcon

In my recent interview of @EricRWeinstein, he referred to "stable preferences" as Achilles' heel of neoclassical econ. Exhibit A is this famous quote from Becker. At face value, Becker is saying a model w/dynamic preferences wouldn't even be economics anymore. Do others agree?

6:29 PM · Dec 8, 2025