----- Original Message ----- From: "Erik Reuter" <[EMAIL PROTECTED]> To: "Killer Bs Discussion" <brin-l@mccmedia.com> Sent: Saturday, January 15, 2005 9:17 PM Subject: Re: Social Security
> Now the SS model is a lot more complicated > -- it has many more than 3 factors, and there will likely be some > correlations, but it is clear that we are in the ballpark of something > that is reasonable and not unjustified by mainstream statistical > analysis. An interesting sidebar on this. I tend to like to use Monte Carlo analysis. It is a very simple way to do fairly complicated statistics, and it is easier to see assumptions when one sets them up in a Monte Carlo than if one makes approximations in statistical analysis. A friend of Amy's (who've we've known for about 10 years) received an honors BA in math and is now in Stanford's PhD program in economics. She was talking about the complex statistical analysis that was needed. I asked her why Monte Carlo analysis isn't done more. I was curious to see if there was some problem I missed. Her answer was, basically, inertia...that it is being done a lot more by the younger scholars. With the price and speed of computers, one can do a one day run of billions of cases of fairly complex multivariable models and obtain results. One can find subtle combinations that aren't intuitively obvious this way. Dan M. _______________________________________________ http://www.mccmedia.com/mailman/listinfo/brin-l
