The Illusion of Knowledge

The U.S., for example, has a population of around 330 million. All but the very youngest and perhaps the very oldest are participants in the economy. Thus, there are hundreds of millions of consumers, plus millions of workers, producers, and intermediaries (many people fall into more than one category). To predict the path of th

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Forecasters have no choice but to base their judgments on models, be they complex or informal, mathematical or intuitive.  Models, by definition, consist of assumptions: “If A happens, then B will happen.” In other words, relationships and responses. But for us to willingly employ a model’s output, we have to believe the model is re

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