Sound and Fury: Mccloskey and Significance Testing in Economics

53 Pages Posted: 3 Dec 2005

See all articles by Kevin D. Hoover

Kevin D. Hoover

Duke University - Departments of Economics and Philosophy

Mark V. Siegler

California State University, Sacramento - Department of Economics

Date Written: November 27, 2005

Abstract

For about twenty years, Deidre McCloskey has campaigned to convince the economics profession that it is hopelessly confused about statistical significance. She argues that many practices associated with significance testing are bad science and that most economists routinely employ these bad practices: "Though to a child they look like science, with all that really hard math, no science is being done in these and 96 percent of the best empirical economics..." (McCloskey 1999). McCloskey's charges are analyzed and rejected. That statistical significance is not economic significance is a jejune and uncontroversial claim, and there is no convincing evidence that economists systematically mistake the two. Other elements of McCloskey's analysis of statistical significance are shown to be ill-founded, and her criticisms of practices of economists are found to be based in inaccurate readings and tendentious interpretations of their work. Properly used, significance tests are a valuable tool for assessing signal strength, for assisting in model specification, and for determining causal structure.

Keywords: statistical significance, economic significance, significance testing, regression analysis, econometric methodology, Deirdre McCloskey, Neyman-Pearson testing

JEL Classification: C10, C12, B41

Suggested Citation

Hoover, Kevin D. and Siegler, Mark V., Sound and Fury: Mccloskey and Significance Testing in Economics (November 27, 2005). Available at SSRN: https://ssrn.com/abstract=860984 or http://dx.doi.org/10.2139/ssrn.860984

Kevin D. Hoover (Contact Author)

Duke University - Departments of Economics and Philosophy ( email )

213 Social Sciences Building
Box 90097
Durham, NC 27708-0204
United States

Mark V. Siegler

California State University, Sacramento - Department of Economics ( email )

6000 J Street
Sacramento, CA 95819-6082
United States
916-278-7079 (Phone)

Do you have negative results from your research you’d like to share?

Paper statistics

Downloads
258
Abstract Views
1,606
Rank
215,727
PlumX Metrics