Theory vs Measurement

I have long held the view that in many applications improved models or econometric techniques are of less importance compared to better measurements or higher data quality. I was glad then to find that I am not alone. The following 60-second lecture (a 2013 video) by one of the leading econmetricians seems to hold a similar view. 

Diebold, 60-Second lecture on theory vs measurement

Of course, many others may have the same view but consider data and measurements as given. I still think it is important to recognise the importance of data and think of ways to improve data collection practices though. As an example, see a recent paper by Manski arguing that the statistical agencies should do more to communicate uncertainty in official statistics and discussing “strategies to mitigate misinterpretation of official statistics by communicating uncertainty to the public”.

Manski , Communicating uncertainty in official economic statistics

Not exactly the same thing, but in my own research (with co-authors) on inequality measurement and PPPs, we try to quantify the uncertainties around these frequently used statistics.


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