In recent days the news machine put a sad note through its persistent, insistent, constant-volume grinder. A noted academic economist died at the modern-day-early age of 58 years.
Mainstream news outlets did the usual sedated shuffle. Quotes were re-quoted, wire articles were passed through largely without click-bait headlines, obituaries were written on short deadlines. No normal people thought to make up a graph to go with the articles.
Coverage in the financial news sector was different. Besides trying to explain some of Mr. Krueger’s work, leading quote-ready economists expressed confusion. The death of this man simply should not have happened. It didn’t fit any of the conventional models!
If one rigorously develops a model of the age of an economist, using all available data, the appropriate model is clear and plain. Some will note that it is still only a math model, and the data set is limited, so an honest economist will add high and low tolerance bands. Based on statistics, the size of the source data set can give us the probability of a model diverging from reality to a high confidence (e.g. three standard deviations). With an adequate sample size, there is a 99.7% chance of reality keeping with the data-based model, and Mr. Krueger is quite rude for violating these well established principles.
But wait! This is how ‘modern’ economics has been done for a century, but now we have neo-modern economics, aided by much more sophisticated math cranked through by powerful computers. This is also how Nobel-winning economists generate influential papers and foundational theories which will be cited by default for a generation.
If one fits all the available data, including recent events, through a multi-variable matrix curve-fit, extending classical statistics into a much wider space, a curve that fits both past and future reality can now be generated with supreme confidence.
The New Model for Age of an Economist will win medals from every quarter. Textbooks will be updated. National budgets will be adjusted. Banks will go broke (unrelated, it just happens all the time). And everyone involved will spend their direct-deposited royalty checks long before the New Model blows up and a New New Model is published which integrates ‘all the latest data’ and ‘provides confident projections’.