ABSTRACT

Reflection on the three yardsticks that Haavelmo claims in his ‘Conclusion’, namely usefulness, reliability and reputability, shows that econometrics has so far fallen notably short of the first one, especially in comparison with the latter two. However, theory-induced blindness is still much too prevalent in the econometrics profession to arouse widespread awareness of the fundamental flaws of the discipline. This is illustrated by a list of unexpected revelations which have dawned on me during the writing of this book.