Some Recent Econometric Developments

Abstract

This paper is an attempt to give the interested economist who is not an econometrician a general picture of some of the developments in the specialized field of econometrics. It is hoped thereby to enable him to see how this field is related to the general science of economics, and how he may be able to make use in his own work of the results obtained in econometrics. The implications of the current rapid innovations in the field of electronic computers are stressed, since these may soon help to produce an ever increasing flow of econometric results.In an address given in 1897, Alfred Marshall suggested that economics should develop not only as a quantitative science in many of its aspects, but also as a numerical science. Professor Schumpeter, in appraising Marshall's advice, observes that it follows the line of development begun by Sir William Petty in his Political Arithmetick of 1672. Schumpeter came down firmly on the side of this prescription himself. He too emphasized the importance of economics' being able to “figure out results.” Professor Pigou also reveals how Marshall, well aware as he was that much in economics cannot be described by numbers, hoped to see the areas that could be so described brought to the same stage as physics, where the amount of an effect produced by a cause can be estimated by numerical methods, using statistical data.