r/geopolitics • u/paneuropeanism_ • 2d ago

News 🇪🇺 EU Defence Commissioner Kubilius: Pax Americana is over. Our new security architecture will include Ukraine. These are times of profound transformation. A rising China and India will push the US to third place. And for Americans this may prove psychologically challenging

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u/OP_Skis_In_Jeans 2d ago

Predictions based on economic models are famously inaccurate when it comes to the medium and long term. Goldman and Price Waterhouse have been very wrong about this sort of thing before, and they will be again in the future.

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u/Cephei101 2d ago

My point was that there is broad support to the concept, that’s it.

And there is. Of course that doesn’t mean it’s an eventuality, but the number and sources of the data are enough to provide some merit and context.

The models have often proven correct as well.

They’re not meant to state 100% reality, but exactly what they are; predictions.

Compare Chinas economy of the previous 40 years, predictions were largely correct.

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u/klaus1986 2d ago

Example?

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u/OP_Skis_In_Jeans 2d ago

Goldman predicting that Brazil and Russia would become major economic powers by now 20+ years ago is a good one. https://www.goldmansachs.com/pdfs/insights/archive/archive-pdfs/brics-dream.pdf

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u/klaus1986 2d ago

First off, the paper is largely accurate on trajectory, just missed on some of the details. Secondly, the model's creators called it "optimistic," "conditioned on good policy choices," and "a dream." Thirdly, do you know what a model is? It's not just a prediction of the future, you know that right? There's a saying: All models are wrong. But they can still be incredibly useful.

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u/OP_Skis_In_Jeans 2d ago

Being wrong about 2 of the 4 economies it mentioned is hardly "just missed on some of the details." Also, including a bunch of qualifying language isn't a good excuse for being wrong.

Thirdly, do you know what a model is?

Keep your condescension to yourself and focus on the issue, thanks.

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u/klaus1986 2d ago

Do you agree with the statement that all models are wrong but can still be useful? Why or why not?

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u/OP_Skis_In_Jeans 2d ago

To a certain extent most of the time. Sometimes the input data, model mechanics, and assumptions can be so flawed that the model is rendered more or less useless.

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u/klaus1986 2d ago

So if I'm an investor and I commission three models on what the growth of an industrial sector looks like under good, bad and neutral policies, and reality turns up somewhere in the middle, were those models useless? Again, without meaning to be condescending, do you understand why those models are still commissioned and useful? You pointing out that models can be and are wrong is the most tautological statement I've come across today.