Philosophy Of Econometrics

The current state of applied econometrics, viewed as the empirical understructure of economics, calls for much greater attention to be paid to the philosophical foundations of empirical modeling. Like political arithmetic towards the end of the 18th century, current econometrics runs a great risk of losing credibility as a way to provide empirical grounding for economic theorizing and policy analysis. The accumulation of mountains of untrustworthy empirical evidence over the last century is a symptom of major weaknesses in the current methodological framework for empirical modeling in economics.