Chapter 7: The Magic of the Experience Curve
One of the problems with economics and finance as sciences is that they tend to find a relationship in the past and assume it will continue into the future. This works well until it doesn’t. Unlike with physics, there tend to be more variables than actual data, and experiments (for example, policy changes in the real world) generally change all the variables at once in a very unscientific way. It’s very difficult to tell what will happen until it does, after which it is so obvious that any idiot should have predicted it…