A piece by Jim Manzi in the City Journal explains why Keynesians and non-Keynesians will still be debating stimulus programs in the 22nd century: social science is inherently limited in situations where there is no counterfactual, because each data point is sui generis. In other words, a causal relationship that might hold under one set of circumstances may not hold under another set. In criminology research, even randomized experiments have not generated many reliable conclusions. Some examples of conclusions Manzi believes do hold up fairly well:
[W]ithin this universe of programs that are far more likely to fail than succeed, programs that try to change people are even more likely to fail than those that try to change incentives. A litany of program ideas designed to push welfare recipients into the workforce failed when tested in those randomized experiments of the welfare-reform era; only adding mandatory work requirements succeeded in moving people from welfare to work in a humane fashion. And mandatory work-requirement programs that emphasize just getting a job are far more effective than those that emphasize skills-building. Similarly, the list of failed attempts to change people to make them less likely to commit crimes is almost endless—prisoner counseling, transitional aid to prisoners, intensive probation, juvenile boot camps—but the only program concept that tentatively demonstrated reductions in crime rates in replicated RFTs was nuisance abatement, which changes the environment in which criminals operate.
You said:
but the only program concept that tentatively demonstrated reductions in crime rates in replicated RFTs was nuisance abatement, which changes the environment in which criminals operate.
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I am asking: what does RFT mean?
[…] causal density is culprit. In Uncontrolled: The Surprising Payoff of Trial and Error for Business, Politics, and […]
[…] Causal density is culprit. In Uncontrolled: The Surprising Payoff of Trial and Error for Business, Politics, and Society, Jim Manzi argues that perhaps the conflict over theory that we witness in the political world is a mere exaggeration which results from syntactical failures in the capacity of natural language to meaningfully and broadly communicate the consequences of highly simultaneous, interdependent and mutually self-reinforcing decisions. What do pundits really mean when they say “austerity measures at present will merely delay the inevitable; a balanced budget today at the expense of stagflation and unemployment tomorrow?” Too few words for too many (operationally undefined) variables. How are inflationary expectations at one firm noumenologically different than a similar process at another, and how are these two cases different than the rest? How do personality-based relations mold the sales processes of competing organizations? When do small and heterogeneous influences matter? I guess that’s where all those Arrow-Debreu futures and contingencies markets come to play. But we ignore the particulars, and with a proof being one thing, getting an empirical foothold on something like that would be akin to predicting the precise trajectories of 22 billiard balls screaming through the air, only after they’ve each already collided with one another. 3-body problems have plagued physicists for centuries. Bring it on? Given the odds, most economists would rather take up professional roulette (and with that, J. Doyne Farmer lets out a yelp from the corner of the room). […]