Bob Murphy Show Ep. 459 Chicago-Trained Alberto Bisin Defends the Use of Mathematics in Economics
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Nov 5, 2025 In a thought-provoking discussion, Alberto Bisin, an NYU economics professor trained in mathematical economics, defends the role of math in economics against recent critiques. He explains how the field has shifted from formal theory to data-driven research, emphasizing math's role in ensuring coherence in economic models. Alberto explores the limitations of traditional models, the unpredictability of markets, and the real-world accomplishments of economists in addressing inflation and poverty. His political journey is equally fascinating, showcasing an evolving stance shaped by economic insights.
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Why Theory Gave Way To Empirics
- Theory's dominance fell because many core theoretical problems were exhausted and empirical tools improved.
- Bisin says empirical, data-driven econometrics replaced formal theorem-heavy work in mainstream journals.
Data And Identification Power Modern Econ
- Advances in data and computation created new empirical opportunities like clever identification strategies.
- Bisin credits large, novel datasets and digital sources for revitalizing applied economics research.
Challenge Models By Relaxing Assumptions
- If you reject a model's result, show which assumptions to relax and prove the result fails.
- Bisin urges critics to relax explicit model assumptions rather than only proclaiming they are unrealistic.