Mark V. Siegler

Sound and fury: McCloskey and significance testing in economics

For about twenty years, Deidre McCloskey has campaigned to convince the economics profession that it is hopelessly confused about statistical significance. She argues that many practices associated with significance testing are bad science and that most economists routinely employ these bad practices: “Though to a child they look like science, with all that really hard math, no science is being done in these and 96 percent of the best empirical economics. . .” (McCloskey 1999). McCloskey’s charges are analyzed and rejected. That statistical significance is not economic significance is a jejune and uncontroversial claim, and there is no convincing evidence that economists systematically mistake the two. Other elements of McCloskey’s analysis of statistical significance are shown to be ill-founded, and her criticisms of practices of economists are found to be based in inaccurate readings and tendentious interpretations of their work. Properly used, significance tests are a valuable tool for assessing signal strength, for assisting in model specification, and for determining causal structure.

The NBA and the influx of international basketball players

The determinants of salaries for professional athletes in the National Basketball Association (NBA) are examined to investigate how international athletes have fared relative to athletes trained in the United States. It is found that international basketball players were paid a large premium above other players of similar skills and characteristics for the 1996–97 and 1997–98 seasons, after which the premium disappeared. This temporary premium is likely attributable to a ‘winners curse’ experienced by NBA teams before investing significant resources in scouting and evaluating international players.

The rhetoric of 'Signifying nothing': a rejoinder to Ziliak and McCloskey

For a quarter century, Deirdre McCloskey has pushed the idea that economists should take rhetoric seriously. So, here we would like to take her advice and consider the rhetoric of Ziliak and McCloskey’s reply to ‘Sound and fury.’ If that old rhetorical device, repetition, were a logically compelling argument, then we would be obligated to concede and withdraw our paper. Alas, it is nothing but the fallacy of argumentum ad nauseam; and, indeed, once the repetition is stripped away it is clear that they give no adequate answer to our key points and that our argument emerges unscathed. Much of their oft repeated points also commit the fallacy of ignoratio elenchi – that is, arguing against a point that was never maintained in the first place. Ziliak and McCloskey write as if we had offered a general defense of existing econometric practice. In fact, we are quite critical of many aspects of econometric practice, but we think that Ziliak and McCloskey are wrong on particular points. They also write as if we were simply channeling their bete noir, R.A. Fisher. We are happy to stipulate, along with one of their heroes, that

International growth and volatility in historical perspective

This paper studies the relationship between the volatility and growth of real GDP using a newly constructed panel data set from twelve countries over the 1870 to 1929 period. In addition, many other variables are examined that are related to economic growth. The goal has been to uncover robust empirical regularities on this issue for the period prior to the Great Depression – a period which has been relatively neglected in previous empirical work. The main finding is that there is a robust negative partial correlation between volatility and growth, after controlling for other factors. This result is consistent with recent empirical evidence on the post-World War II period.

The Wealth of Nations Rediscovered: Integration and Expansion in American Financial Markets, 1780–1850: Robert E. Wright; Cambridge, UK: Cambridge University Press, 2002, 254 pages

addressed these issues in other books or articles, these works should be referenced as serious readers may wish to take action rather than simply read an interesting book. Perhaps the best audiences for Literacy in America are those individuals or grassroots organizations who develop and implement family literacy, school readiness, or adult literacy education programs. Its value for this audience is its obvious support of family-based education, and its recurring theme that productive literacy education can occur under a variety of less-than-ideal conditions. Individuals involved with literacy education on a broader scale, such as large public school districts, can draw inspiration from Gordon and Gordon’s work, for the book is very uplifting and motivating. However, these readers must also address those issues that Gordon and Gordon leave unacknowledged, and will have to turn elsewhere to find practical solutions. Beyond these two audiences, anyone who is interested in American history or the history of education will find a wealth of accessible, factual information between the covers ofLiteracy in America. Despite the underdeveloped solutions, Gordon and Gordon deserve accolades for Literacy in America due to its novel focus and the extensive research it contains. By documenting how literacy was obtained historically, the authors do lead us to reconsider the direction of contemporary literacy education. This point is Gordon and Gordon’s most important contribution to the field.Literacy in America makes us think about our headlong rush to mass-produce literacy for everyone, and consider what we may be losing along the way.