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Thursday
Jun052008

Evidence that Bernanke really is more highly evolved

Ben Bernanke wrote this in 1974 as a Harvard undergrad:

No matter how sophisticated the theory behind an estimated equation, the equation is always naïve. This is particularly problematical in the social sciences, when the basic unit of observation is so often that political, free-willed, unpredictable character, the individual human.

If all economists and politicians understood this, I would have a lot less to write about. My general view is that, to the contrary, they either believe their equations closely represent reality or that the equations represent a utopia to which reality must, and can, be conformed. My current view of Bernanke is that he is a pragmatic professional who still has in mind what he wrote 34 years ago, is not constrained by any ideological straight jacket, and won't follow any equation over a cliff. That's a pretty low bar to get over, but I'm satisfied.

The quotation and more about Bernanke's undergraduate years at Harvard are in this New York Times article today.  And the visual evidence of Bernanke's evolutionary status is here

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