The Role of Hypothesis Testing in the Molding of Econometric Models

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2012-01-18

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Abstract

The paper is a keynote lecture from the Tilburg-Madrid Conference on Hypothesis Tests: Foundations and Applications at the Universidad Nacional de EducaciĆ³n a Distancia (UNED) Madrid, Spain, 15-16 December 2011. It addresses the role of tests of statistical hypotheses (specification tests) in selection of a statistically admissible model in which to evaluate economic hypotheses. The issue is formulated in the context of recent philosophical accounts on the nature of models and related to some results in the literature on specification search.

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statistical testing, hypothesis tests, models, general-to-specific specification search, optional stopping, severe tests, costs of search, costs of inference, extreme-bounds analysis, LSE econometric methodology

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https://hdl.handle.net/10161/13182

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Scholars@Duke

Hoover

Kevin Douglas Hoover

Professor of Economics

Professor Hoover's research interests include macroeconomics, monetary economics, the history of economics, and the philosophy and methodology of empirical economics. His recent work in economics has focused on the application of causal search methodologies for structural vector autoregression, the history of microfoundational programs in macroeconomics, and Roy Harrod's early work on dynamic macroeconomics. In philosophy, he has concentrated on issues related to causality, especially in economics, and on reductionism -- the philosophical counterpart to microfoundations. Recent publications include:

  • "Trygve Haavelmo's Experimental Methodology and Scenario Analysis in a Cointegrated Vector Autoregression" (Econometric Theory, 2015), 
  • "Reductionism in Economics:  Intentionality and Eschatological Justification in the Microfoundations of Macroeconomics" (Philosophy of Science 2015), 
  • "Mathematical Economics Comes to America:  Charles S. Peirceā€™s Engagement with Cournotā€™s Recherches sur les Principes Mathematiques de la ThĆ©orie des Richesses" (Journal of the History of Economic Thought, 2015), 
  • "The Genesis of Samuelson and Solowā€™s Price-Inflation Phillips Curve" (History of Economics Review, 2015), 
  • "Solow's Harrod: Transforming Cyclical Dynamics into a Model of Long-run Growth" (European Journal of the History of Economic Thought 2015), 
  • "In the Kingdom of Solovia:  The Rise of Growth Economics at MIT, 1956-1970" (History of Political Economy 2014), 
  • ā€œStill Puzzling: Evaluating the Price Puzzle in an Empirically Identified Structural Vector Autoregressionā€ (Empirical Economics, 2014),
  • "On the Reception of Haavelmo's Econometric Thought" (Journal of the History of Economic Thought, 2014) ā€“ winner of the History of Economics Society Best Paper Award in 2015.  

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