Tag: Econometrics

  • Goodhart’s Law

    Goodhart’s Law

    Coined by Charles Goodhart, the principle “When a measure becomes a target, it ceases to be a good measure” highlights the unintended repercussions of emphasizing a singular metric. Originating from monetary policy observations, the principle reveals how entities adjust their behaviors in response to metrics becoming primary objectives across diverse sectors.

  • Causal Inference

    Causal Inference

    Causal inference provides a framework for deducing the relationship between cause and effect using empirical data. It employs a variety of rigorous methods to ensure the validity of its findings, making it indispensable in fields such as policy evaluation, economics, and healthcare.

  • Gini Coefficient

    Gini Coefficient

    The Gini coefficient is a statistical measure used to quantify income or wealth distribution inequality. Ranging from 0 (perfect equality) to 1 (absolute inequality), it’s a widely used tool in economics, despite limitations like not accounting for income levels or inequality sources.