Thursday, September 20, 2012

News story on economic impact review site

A few news stories have come up on my new website, Economic Impact Review.

Here's a link to the SU story

Susquehanna University Associate Professor of Economics Matthew Rousu has developed a website to reduce confusion and bias among economic impact studies of the state’s Marcellus Shale reserves.
“Many economic impact studies are commissioned by groups that want a certain outcome,” said Rousu. “There often are incentives for ‘mistakes’ to be made, as long as those mistakes help the outcome. An economist paid for by a firm in favor of Marcellus Shale drilling, for example, may use different methods or different assumptions and arrive at different estimates than an economist paid by a group that opposes drilling.”
Rousu created, which will publish and review economic impact studies and provide best practices for conducting such reviews. While the initial emphasis is on Marcellus Shale studies, the plan is to expand the reviews to other economic impact reports, as well.
“A properly conducted economic impact analysis can be valuable,” he said. “But unlike academic studies, very few economic impact studies are reviewed by other experts in the field.
“These studies can be done ethically or less ethically, but a high enough percentage of them are done very poorly,” he said. “Because of this, anytime I first hear about a new economic impact study, I don’t initially trust it. And that’s too bad, because sometimes they can be important.”
Economic impact reports vary widely in quality, Rousu said. One of the website’s goals is to bring credibility to the field by providing independent reviews and promoting best practices.
“Currently, when economic impact studies are published, many media outlets just run with the estimates,” he said. “This makes sense, since most reporters are not economists. But this means that there’s no incentive for an agency to be honest in its methodology when conducting these analyses, as there are rarely groups or individuals that counter any misleading statistics. We aim to correct that.”


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