The Seven Properties of Good Models
Year: 2008
Type: book-chapter
Abstract: Models are significant as they are used to provide a supposedly reliable description or representation of the world. Most of the models that scientists attempt to generate and analyze are based on assumptions that are only believed to be true since such models would not consider irregularities and inconsistencies with common theory. This chapter introduces seven key properties, whether they already be widely accepted or have yet to be accepted at all, that a good economic model should possess: 1) parsimony, 2) tractability, 3) conceptual insightfulness, 4) generalizability, 5) falsifiability, 6) empirical consistency, and 7) predictive precision. For this analysis, it is argued that classical optimization assumptions are not necessary in coming up with economic models, and that these should be regarded as hypotheses that require testing.
Source: Oxford University Press eBooks
Authors: XAVIER GABAIX, DAVID LAIBSON
Language: English
Subfield: Economics and Econometrics
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W2142089959