Saturday, April 14, 2012

Models versus words

(This is my comment on « How to answer “true, false, uncertain” questions » by Frances Woolley).
Your post is interesting. I have no doubt that it will be useful for students. It made me think about certain weaknesses of current practices in teaching economics.
You first speak about the “true by definition” type of questions. I hope there are not too many of them, because definitions by themselves have only the appearance of knowledge.
It is often said that we have to find in our tool-box the relevant model. You give precise tips about how to find the right model. That would be a good step for programming artificial intelligence for answering such questions. But a student who has to rely on such clues surely lacks familiarity with the models.
Then you answer the question « True, false, uncertain: "Natural gas price controls during the late 1970s hurt producers at the expense of consumers, but did improve economic efficiency." ». Your answer is standard, but I don’t like it. I don’t like the use of diagrams (and of economic jargon). I think that it obscures rather than illuminates the question. In one sense, it is an overkill since a verbal answer would have been sufficient. But in another sense it is less than a verbal answer since it is too specific. Implicit assumptions and loose ends are quite hidden in the diagram presentation, whereas a verbal answer can more easily be connected to common sense and public debate, and thus its weaknesses can more easily be spotted. What is the likelihood that a student will notice that perfect competition is assumed, and ask to either prove that this assumption was satisfied in the natural gas market in the late 70’s or prove that your point is still valid when competition is imperfect? What student will notice that the price in the diagram does not include some externalities (like pollution)? Another weakness of diagrams is that drawing them necessitates assuming some slopes, even if the conclusion does not depend on those slopes. We surely can hope that students will understand that your conclusion about the efficiency loss triangle is still valid with other slopes (of the same sign) and that other points (like whether the consumer surplus is larger or not thanks to price control) depend on the slopes. But if the conclusion does not depend on the slopes, it seems it would be more efficient that they do not enter the discussion. They are necessarily part of a diagram, but a verbal discussion tends more naturally to either avoid them or be explicit about the various possible cases.
It is said that a picture is worth a thousand words. But it seems to me that verbal answers (I give mine on my blog) have certain advantages. I would even go so far as to argue that models (even a simple diagram) should be taught only when they are really necessary for answering a relevant question (just using a model for the sake of using it is not relevant).


  1. Unintended - thanks for these comments and for the post. I replied on Worthwhile Canadian Initiative, and also edited your comments there to make the link to this blog live.

    I should probably have said more about the importance of words in the original post - your responses raises some serious questions about how/should economics profs teach students about writing.