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The Wall Street Journal on 15th December, 2000 published an interesting letter to the editor on the use of mathematical models to describe the world as imagined by economist. Entitled, "Who let the Cats Out?" by Jeffrey Huston.
"I read with interest Susan Lee's review (Bookshelf, Dec. 7) of John Sutton's recent book "Marshall's Tendencies." As an alternative interpretation of the usefulness of mathematical models within the discipline of economics I offer the following observation shared with me by Jan Kmenta some 22 years ago. There are three types of economist: economic historians, economic theorist and econometricians. An economic historian has the task that is like chasing a black cat in a dark room. The theorist, on the other hand, is chasing a black cat in a dark room, but there is no cat. Lastly, the poor econometrician is chasing a black cat in a dark room when there is no cat and he proclaims, "I have it!"
To which should be added a fourth category of economist - a politico-economist. It makes no difference if the cat exist or not, it will be painted black or red by the politico-economist to reflect his or her views of whether the party in power is permitting the country or driving it to ruin. The color chosen will depend upon how the economist registers to vote and if his/her party is in power. The politico-economist, of course knows that after dark, all cats are grey, but it matters not so long as political capital can be made at the expense of the other party.
Note added in proof. Louis Maurer in a drawing entitled, Letting the "Cat out of the bag, which was published by Currier & Ives, in 1860. Maurer had Lincoln and his cohorts trying to keep the cat in the bag to prevent his not being chosen as the Republican candidate for President.
Frederic Bastiat followers would insist that you must permit the cat to breed so that you can offer the offspring to the French and English for culinary dishes. They will export the hides to a Far East country to be made into fine gloves, etc., which will be sold to you and your fellow citizens. The free trade ensuing will enrich you, the French and English, and the second tier nation as well; permitting all to take leisure. But wait you say, "the cat does not exist." No problem, our Government will through the use of hot-decking(a) provide numerical proof of its existence based on their knowledge of the kind and number of pets in your neighbor's house.
Note added in proof. The Supreme Court voted in 2002 that it is permissible for the census bureau to use hot-decking to estimate the number of peoples who inhabit properties even when it is not possible to know if they (the peoples and the property) actually exist or not. On this basis, North Carolina was permitted to gain representatives to the United States House of Representatives while (and at the expense of) Utah could not increase its representatives (although it is acknowledged that Utah most surely had a more accurate head count.)
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(a) Devised by Deming (of Total Quality Assurance fame). Named after the process which used computer cards to count responses to various Census question. Fresh data on piles of cards (decks), warmed by processing, was eagerly sought. Where data was missing, the "nearest neighbor" data is used to fill in the blank. The process continues although the use of cards (decks) is long gone.
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