IE University || Social Impact Project

Learn in the lastest edition of IE Edutainment about first year IE University BBA student Carolin who spent 2 months at UNICEF – part of IE University’s Social Impact Project – and we go behind the scenes at the First International BIARI Workshop, as participants wrestle with the issue of Climate Policy for World Cities.

IE International Executive MBA is going GLOBAL

The IE International Executive MBA includes two new academic partners and offers now 3 1-week residential periods in the US (Brown University), Brazil (Insper)  and China (Fudan University). In keeping with IE Business School’s commitment to educating globally-oriented, entrepreneurial leaders, we have forged ties with leading academic institutions in the United States and Brazil. Our…


Astrology and economic forecasts

The current crisis has once again shown how wrong economic forecasts often are. So why is it such a deeply flawed profession? John Galbraith once said that “The only function of economic forecasting is to make astrology look respectable.” Although many of us are avid readers of economic forecasts issued by the OECD, the IMF, and the EU (the government’s forecasts tend to suffer from a general lack of creditability), it is questionable if our confidence in them is well founded. In my opinion, which is based on my experience, it is not.

Firstly, a large number of economic models try to predict the future by extrapolating the past. The current crisis, like so many others, has highlighted the folly of this method. Such models also predicted in the 1950s that the USSR would become the world’s most powerful economy (its economic growth rate was three times that of the west at the time), and the same was said about Japan (remember the best seller Japan as Number 1, by Harvard Professor Ezra Vogel?), the Asian dragons in the 90s, and now it’s China’s turn. The logic of projecting past growth rates onto the future is an intellectual and economic fallacy, as stated by Paul Krugman in his excellent paper “The Myths of Asia’s Miracle”.