The Cournot Centre’s Prismes

Random Running

prisme_21_enPrisme N°21

Michel Armatte

February Release

Is Everything Stochastic?

prisme20_en_webPrisme N°20

Glenn Shafer

Prisme N°20 December 2010 (747.1 KiB)

Kolmogorov said no, Popper said yes. My sympathies lie with Kolmogorov, the old-fashioned empiricist.

In the on-line setting, where we see previous outcomes before making the next probability forecast, we can give probabilities that have objective value because they pass statistical tests. This accounts for the success of many adaptive methods, and it is related to Leonid Levin’s notion of a universal prior probability distribution. It tells us that yes, everything is stochastic, but in a sense that is empirically empty because it is not falsifiable.

When we understand that success of adaptive methods does not depend on the world being stochastic in a falsifiable sense, we may want to be more parsimonious in causal modeling and more open to non-standard methods of probability judgement.

The Art of Spurious Regressions: Can Statistics Do without Artefacts?

prisme 19

Prisme N°19

Jean-Bernard Chatelain

Prisme N°19 Octobre 2010 (1005.5 KiB)

This text is currently being translated into English.

This article presents a particular case of spurious regression, where a dependent variable has a simple correlation coefficient close to zero with two other variables, which are on the contrary highly correlated with each other. In this type of regression, the parameters measuring the magnitude of effects on the dependent variable are very high. They can be “statistically significant”. The tendency of scientific journals to favour the publication of statistically significant results is one reason why spurious regressions are so numerous, especially since it is easy to build them with variables that are lagged, squared or interacting with another variable. Such regressions can enhance the reputation of researchers, by stimulating the appearance of strong effects between variables. These often surprising effects are not robust. They often depend on a limited number of observations, and this fact has fuelled scientific controversies. The resulting meta-analyses, based on statistical synthesis of the literature evaluating this effect between two variables, confirm the absence of any effect. The text provides an example of this phenomenon in the empirical literature, with the aim of evaluating the impact of development aid on economic growth.

• Order free of charge

First Name* Last Name*
Telephone Your Email*
Control* captcha (please enter the characters shown in the image)
* required field

The Impossible Evaluation of Risk

Prisme18_couvANPrisme N°18

André Orléan

Prisme N°18 April 2010 (446.1 KiB)

Read more »

A Moment of the Probabilistic Experience – The Theory of Stochastic Processes and Their Role in the Financial Markets

prisme17_enPrisme N°17

Nicole El Karoui, Michel Armatte

Prisme N°17 February 2010 (560.6 KiB)

Read more »

Should You Take a Risk When You Do Not Know for Sure? From Judging to Acting since Condorcet

PRISME16_EVPrisme N°16

Pierre-Charles Pradier

Prisme N°16 March 2010 (513.4 KiB)

Read more »

An Economic Analysis of Fair Value: Accounting as a Vector of Crisis

prisme15Prisme N°15

Vincent Bignon, Yuri Biondi & Xavier Ragot

Prisme N°15 August 2009 (537.1 KiB)

Read more »

Why Contemporary Capitalism Needs the Working Poor

prisme14Prisme N°14

Bernard Gazier

Prisme N°14 December 2008 (426.5 KiB)

Read more »

History Repeating for Economists: An Anticipated Financial Crisis

prisme13Prisme N°13

Robert Boyer

Prisme N°13 November 2008 (1.4 MiB)

Read more »

Towards a Probabilistic Theory of Life

prisme12Prisme N°12

Thomas Heams

Prisme N°12 September 2008 (551.8 KiB)

Read more »

Does Fiscal Stimulus Work?

prisme11Prisme N°11

Edouard Challe

Also available in German

Prisme N°11 November 2007 (254.3 KiB)

Read more »

The Japanese Economy after the Flux Decade: Where Will Changes in Company Structure Lead?

prisme10Prisme N°10

Masahiko Aoki

Prisme N°10 September 2007 (186.3 KiB)

Read more »

Building a Fiscal Territory in Europe: Prohibiting, Harmonizing, Approximating, Guaranteeing, Informing

prisme9Prisme N°9

Évelyne Serverin

Prisme N°9 March 2007 (176.5 KiB)

Read more »

Political Goals, Legal Norms and Public Goods: The Building Blocks of Europe?

prisme8Prisme N°8

Robert Boyer & Mario Dehove

Prisme N°8 November 2006 (671.2 KiB)

Read more »

From Cournot to Public Policy Evaluation: Paradoxes and Controversies of Quantification

prisme7Prisme N°7

Alain Desrosières

Prisme N°7 April 2006 (258.2 KiB)

Read more »

Patent Fever in Developed Countries & its Fallout on the Developing World

prisme6Prisme N°6

Claude Henry

Prisme N°6 May 2005 (135.4 KiB)

Read more »

From Financial Capitalism to a Renewal of Social-Democracy

prisme5Prisme N°5

Michel Aglietta & Antoine Rebérioux

Prisme N°5 October 2004 (206.6 KiB)

Read more »

An Economic Analysis of Fair Value

prisme4Prisme N°4

Vincent Bignon, Yuri Biondi & Xavier Ragot

Prisme N°4 March 2004 (234.0 KiB)

Read more »

Reforming Europe: Is the Third Way the Only Way?

prisme3Prisme N°3

Bruno Amable

Also available in Japanese

Prisme N°3 January 2004 (551.0 KiB)

Read more »

Lessons Learned from U.S. Welfare Reform

prisme2Prisme N°2

Robert Solow

Prisme N°2 November 2003 (108.4 KiB)

Read more »

Ramifications of the European Commission’s Directive on Takeover Bids

Prisme N°1

Jean-Louis Beffa, Leah Langenlach & Jean-Phprisme1ilippe Touffut

Prisme N°1 September 2003 (262.3 KiB)

Read more »

Related Links

Resource Links