Times Interview with Lars Hansen

Article Link

From the article:

The thing to remember about models is they’re always approximations and they will always turn out to be wrong at some point. When someone says all the models that economists use are wrong, well, in a sense that’s true. But you need to ask, are the models wrong in ways that are central to the questions, or are they wrong in ways that aren’t so central?

And so part of the task of statistical analysis is to look at models and try to figure out what the gaps are so that people will build better models in the future.


Source: Jeff Sommer, "A Talk With Lars Peter Hansen, Nobel Laureate, " The New York Times, November 16, 2013