Talk:Robustness (economics)
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definition
[edit]I went onto a popular search engine to check the definition, and the first paper I found (Kuorikoski et al)had a different definition of robustness, so I have incorporated this. --Cat4567nip (talk) 16:49, 4 May 2010 (UTC)
Re: Robustness of an economy:
Quoted from this wikipedia article: "robustness is the ability of a financial trading system to remain effective under different markets and different market conditions"
Effectiveness is the key concept in this definition. It deserves a page of its own. Failing that, lip service should at least be paid in this article to the ambiguity of the term. The definition given is precisely the naive notion. Therefore, regardless of the accuracy or appropriateness of this definition, care should be taken to call the term 'effective' into question, highlighting the many uses of the word in economics, and the apparent lack of consensus on some of its various definitions.
Poskart, Robert (2014) "A Definition of the Concept of Economic Effectiveness" In: CENTRAL AND EASTERN EUROPEAN JOURNAL OF MANAGEMENT AND ECONOMICS (pp.179-187) Edition: Vol. 2, No. 3 Chapter: 2 Publisher: Wrocław School of Banking. Editors: Joost Platje. Link: https://www.researchgate.net/publication/273455739_A_Definition_of_the_Concept_of_Economic_Effectiveness
There's also this problem, quoted from the same article:
"Z. Sadowski points out that effectiveness can be an appropriate measure for human activity only at the microeconomic level. This is due to the fact that at the macroeconomic level there are multiple goals, of which only a certain proportion can be expressed in material form, i.e. both inputs and outputs can be measured numerically. In addition, it is not possible to objectively compare inputs and outputs in non-profit organisations, e.g. in education, as well as foundations and societies of various types (Sadowski 1980: 88)."
If Sadowski is to be credited, what are we to make of the use of the term 'effective' here in this wikipedia article? Is effectiveness in this context an aggregate of microeconomic effectiveness? Or perhaps robustness is another kind of aggregate; an aggregate of measures of effectiveness on a case-by-case basis, each case being determined by effectiveness as measured according to each of the "different markets and different market conditions" referred to in the given definition.
Or (perhaps most plausibly), are we to interpret this definition as though the economy whose robustness is being measured exists on the microeconomic scale, in a global macroeconomy? If this is the case, it certainly needs to be indicated transparently in this article. Otherwise, the given definition is bound to reinforce the naive notion of robustness as an absolute measure, independent of the international macroeconomic circumstances. (To clarify that remark, it's the forgivable naivete of the notion of the absoluteness of the measure that care should be taken to dispel, not the more extreme and dismissable naivete of believing that economic robustness itself is independent of international circumstances.)
Finally, if robustness is a term that should be regarded as informal, intuitive or rhetorical in economics, that should be made clear.