August 23, 2006

MeaSUREment?

I reckon the Freakonomics book has transformed my understanding of economics by saying, economics is the science of measurement. This is by the way a brilliant piece of 'nlp installation' or what I call, presuppositional setup.

And now, another piece of, courtesy by Dave Snowden

Goodhart a British economist is widely held to have formulated the equivalent of Heisenberg’s Uncertainty Principal for economics. It states as follows :-

Any statistical relationship will break down when used for policy purposes

A simpler formulation from a US academic translates this as :-

If a measure becomes a target, then it ceases to be a measure

In a very real sense you get what you measure and you live to regret it :-)

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