Friday 24 February 2017

David McWilliams: ESRI has been getting its forecasts wrong for years

In Irish economic circles, you tend to take much more stick from having been right than having been wrong. Those economists who got it wrong in the boom and believed the hype about the soft landing, such as the ESRI, still manage to grab front-page headlines. In contrast, those who called it right are put under constant scrutiny and are still being dismissed by the establishment as cranks, celebrities or, at best, lucky opportunists.

The "insiders" rally round each other even when they are wrong and the "outsiders" are denigrated. In the economics world, for what it's worth, the outsiders' crime -- the crime of being right -- is particularly dangerous precisely because it exposes the limitations of the insiders. This type of insider/outsider prototype is commonplace in Ireland.

Yesterday, we saw more of this type of behaviour where the establishment insiders carry on with their forecasts despite their appalling records.

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