More Companies Using Experimental Economists

Surprises

from the a-step-forward dept

While it’s true that it’s difficult to find economists who agree with each other, that doesn’t mean (as some would like you to believe) that economics is useless. The basic principles behind economics are pretty sound. The issues generally come up in how people interpret putting specific situations into economic models. That’s because there are so many variables in real world economics, it’s nearly impossible to model them all. So, the different opinions coming from different economists tend to be based on what sorts of variables they throw into models, and how they weight them. The truth is, however, that there’s plenty of good things to be learned from the various models and experiments done by economists in various fields to try to narrow down those variables and perfect those models.

And, of course, those models can be quite practical. So it’s great to see more and more companies (especially in the tech world) hiring experimental economists and putting them to work to start making more economically sound decision making, rather than seat-of-the-pants decisions on ways to adapt new business models, products and pricing. While there will still be plenty of mistakes, there will be a much better overall understanding of what works and why.

Filed Under: companies, economics, experimental economics
Companies: google, hp, yahoo