Odd Lots Big Take DC: Economists May Be Using Bad Data to Make Big Decisions
Jan 30, 2024
The podcast tackles the tricky balancing act the Federal Reserve faces in managing inflation. It questions the reliability of labor market data and highlights the urgent need for updated metrics after the pandemic. Survey response rates are falling, casting doubt on data representativeness, which could affect future economic decisions. The discussion also contrasts hard versus soft data, illustrating how public sentiment plays a role in economic growth. Lastly, it emphasizes restoring trust in government institutions to improve data collection.
AI Snips
Chapters
Transcript
Episode notes
Data-Driven Decisions at the Fed
- The Federal Reserve's decisions, particularly interest rate hikes, are influenced by data like the JOLTS survey.
- Claudia Sahm questions the JOLTS data's reliability due to pandemic-induced changes in job listing practices.
JOLTS Data Reliability
- Joe Weisenthal and Tracy Alloway express skepticism about the JOLTS data's reliability.
- They highlight the pandemic's impact, noting changes in employer behavior like increased job postings due to lower costs and labor hoarding.
Survey Response Rates
- The pandemic has not only impacted JOLTS data but also survey response rates.
- Declining participation raises concerns about data quality, as highlighted by Tracy Alloway and Joe Weisenthal.