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August 12, 2009 3:00 am
From Mr K. Sreenivasan.
Sir, Two elegant expositions (Letters, August 10) on how to fix the current failures of economic theories in predicting a crash have missed the point. It is similar to using Fourier analysis to study the wavy motion of a snake. Including a large number of terms in the series will seldom predict the instant of a snake bite, nor whether the bite is fatal. This does not imply that Fourier analysis is erroneous nor does it disprove the well documented behaviour of snakes.
David Fisk suggests the use of engineering methods of running models in parallel. Success of these engineering models in predicting the in-flight performance of Airbus is not the issue. A pertinent question is whether these models are useful in predicting an air crash. Meanwhile, Richard Rous fails to focus on Keynes’ suggestion that economics should be taught as a moral science, a point emphasised by Robert Skidelsky (August 6).
John Stuart Mill said that if we make men honest, good and decent then they will make themselves honest, good and decent engineers, doctors and teachers. Let us hope that by teaching ethics to bankers, traders and chief financial officers they will go on to become moderating agents in tempering human greed.
Palo Alto, CA, US
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