Haldane envisages ‘iterative’ approach to advancing economics

Deductive and inductive approaches “need to share a broadly equal billing”, BoE chief economist says

Andrew Haldane
Andrew Haldane: “Economics and finance needs to make an ongoing investment in big data”
Bank of England

Andrew Haldane has outlined a vision for the future of economics in which both inductive and deductive methods come together in a process of “iterative learning”.

The Bank of England chief economist said many of the fragilities of earlier economic models could have been avoided if both empirical, inductive methods and theory-based, deductive methods worked together.

Macroeconomists have tended to favour the latter, notably in the dynamic stochastic general equilibrium (DSGE) models widely used

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