A journalist once asked me how many jobs NAFTA had created or destroyed. I told him I had no reliable idea. Certainly jobs had been lost when factories closed and moved to Mexico but other jobs had been gained because Americans now had more resources and increased their demand for products that would not be easy to identify. Why not? Because thousands and thousands of jobs are created every month and it is very difficult, perhaps impossible to know which ones are related to NAFTA allowing Americans to buy less expensive goods from Mexico. I also told him that I believed that trade neither destroyed nor created jobs on net. It’s main impact was to change the kinds of jobs and what they paid.More:
The journalist got annoyed. “You’re a professional economist. You’re ducking my question.” I disgreed. I am answering your question, I told him. You just don’t like the answer.
Most economics claims are really not verifiable or replicable. Most economic claims rely on statistical techniques that try to simulate a laboratory experiment that holds all relevant factors constant. That is the hope. My claim is that in general, holding all relevant factors cannot be done in a way that is reliable or verifiable. And that is why so many empirical issues such as the minimum wage, immigration, fiscal policy, monetary policy and so on, have smart people on both sides of the issue each with their own sophisticated analysis to bolster their claim.