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Economists effectively contribute to the betterment of a country's economic status provided they realize their role and capabilities. To effectively guide, economists should lose their self-absorption, increase their knowledge about real phenomena and consequences, and realize that policymaking is a human initiative. Economists must learn to coincide flexibility of approach with the willingness to experiment by adhering to the basic truths of economic theory. They must also realize the significance of foreign aid organizations that develop better policies.

Research presented concerns the calibration methodology used to study macroeconomic theories, in particular, the real business cycle theory. A Keynesian model called the Fairmodel is examined, focusing on how model simulations compare to US data.

Economic policy reform requires an extensive analysis of the current political conditions and the reform's possible implications. Economists should collaborate with political scientists and apply appropriate analytical models for an in-depth study of economic and political policies. Moreover, the nearsightedness of political policies should be identified and avoided to prevent the conflict between the reforms and political interests which could defeat the reform's purpose of providing public good.

Among the signals of approaching senility, few can be clearer than being asked to write an article on one's methods of work. The profession's implied judgment is that one's time [...]

The factors why environmental economists utilize Hicksian welfare measures and agricultural economists use Marshallian surplus measures were investigated. The divergence between the data used, policy problems and parameter estimates confronted by environmental and agricultural economists were compared. The differences between the mean squared errors of Marshallian and Hicksian welfare measures were also compared. It was suggested that usage of either welfare measures involves a trade-off in either bias or variance.

The popularity of efficiency measurement in applied economics has drawn attention toward the evaluation of the empirical techniques used by researchers. Researchers are not relating measurement and theory in a systematic manner. Economists should relate their choice of sample or research method to the investigation of the issues raised by the X-efficiency theory of Harvey Leibenstein. The nature of the cause and effect of inefficiency can only be measured if a more scientific approach to sample selection is taken.

Economists are often puzzled as to why profit-maximizing firms buy professional forecasts when statistics such as the root-mean-squared error or the mean absolute error often indicate that a naive model will forecast about as well. This paper argues that the reason is that these traditional summary statistics may not be closely related to a forecast's profits. Using profit measures, we find only very weak relationships between such summary error statistics and forecast value. If these results are robust, then least-squares regression analysis may not be appropriate for many studies of economic behavior. (JEL C52, C10)