Economists have allowed themselves to walk into a trap where we say we can forecast, but no serious economist thinks we can. You don't expect dentists to be able to forecast how many teeth you'll have when you're 80. You expect them to give good advice and fix problems.
Interpretation
Economists often overestimate their ability to predict future economic events, similar to how dentists cannot predict the exact number of teeth you'll have in the future.
In this quote, Tim Harford highlights the limitations of economic forecasting, suggesting that while economists may propose they can make predictions, the reality is that uncertainty in human behavior and variables in the economy make accurate forecasting nearly impossible. He compares economists to dentists, who provide valuable advice and solutions but cannot foresee long-term outcomes, emphasizing the importance of focusing on guidance rather than predictions.
In practice
This quote can be used in presentations about economic policies to underscore the importance of seeking practical advice over predictions.
It's difficult because we tend to overrate the pain of failure. We fear it too much. That's research that emerges from psychology. We think it's going to be worse than it really is. And, I think, as we get a bit older, really after we leave school or college, we quickly stop experimenting.
In certain businesses, I would say 10 failures to one success is a perfectly acceptable ratio. Because the failures die pretty quickly, they're not that expensive, and the successes can be really huge.
Success Comes Through Rapidly Fixing our Mistakes Rather than Getting Things Right the First Time.
If you don’t feel comfortable making a rough estimate of the asset’s future earnings, just forget it and move on. No one has the ability to evaluate every investment possibility. But omniscience isn’t necessary; you only need to understand the actions you undertake.
And indeed there will be time to wonder, 'Do I dare?', and 'Do I dare?
Only let the moving waters calm down, and the sun and moon will be reflected on the surface of your being.
I have great respect for the past. If you don't know where you've come from, you don't know where you're going. I have respect for the past, but I'm a person of the moment. I'm here, and I do my best to be completely centered at the place I'm at, then I go forward to the next place.
I care so much about everything that I care about nothing.
If water derives lucidity from stillness, how much more the faculties of the mind.
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