PSA2016: The 25th Biennial Meeting of the Philosophy of Science Association

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Good Economic Measurement

This research project in the philosophy of economics is funded by the Dutch Science Foundation (NWO) and runs from 2014-2018. It aims to provide an account of economic measurement that is both normative as well as geared towards the “end-user” of economic numbers, such as policy-makers, policy-advisors and the general educated public. I would like to discuss this project with colleagues at PSA because it is an exercise in practice-oriented philosophy of science, while also reaching out to policy-advisors.

Numbers are ubiquitous in economic policy-making: GDP, unemployment, inflation, discount rates, and many more are frequently in the focus of interest. Yet, such numbers can take on a life of their own: often, they are used without paying attention to what kinds of assumptions and limitations they entail. This research project develops a coherent account of measurement for economic policy. This account will allow me to make precise what kinds of assumptions are hidden in numbers that are frequently used in economic policy and what good principles are according to which such numbers can be constructed. The main research question that this project answers is: what are the conditions under which we can construct quantified concepts for use in economic policy?

The project answers this research question by realizing three objectives, one theoretical and two applied.
- For one, the project reviews and synthesizes different approaches to measurement in the philosophy of science, social science, and economics. I put forward a view of “good economic measurement” that is informed by the most recent contributions in the philosophy of measurement. For this, I engage in a survey of measurement practices in economics, as well as critically engage with the most recent work in the philosophy of measurement, and in particular with those in economics. The problem of measurement in economics has hitherto been explored in piecemeal fashion, closely linked to specific practices of measurement in some areas of economics. I gather some of these perspectives and explore ways in which we can talk about economic measurement more generally.
- Moreover, two case studies will be used to revise and test the theoretical account. One case study looks at the measurement of time discount rates and another one at the measurement of happiness, asking in how far the concepts and methods in these areas can satisfy general measurement conditions. Here, I engage directly with economic and social scientific practice. What is more, I also work with policy-advisors to gather their views on how they use numbers from economics. For any given numbers put forward by an economist it can be very important for them to ask to what extent it encapsulates good economic measurement. Based on the unified account of measurement and the two case studies, I formulate guidelines for policy-advisors and policy-makers.

Author Information:

Conrad Heilmann    
Erasmus Universiteit Rotterdam


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