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PONTIFICIAE ACADEMIAE SCIENTIARVM SCRIPTA VARIA - 7
the world. In the last analysis, this achievement is probably
due to the effective learning process which results from com-
bining theories developed by means of mathematics, and thus
sharing in the clarity, rigour and power of that subject, with
observations of the real world, reduced as far as possible to
quantitative terms. Iteration between theory and observation
is leading in Econometrics, as in other branches of science,
to a systematic body of verifiable knowledge about the real
world.
Since the Study Week was concerned with applications of
econometric analysis, our thoughts on the desirable directions
of future research necessarily ranged over a wide area. They
can conveniently be summarised under three heads: the ana-
lysis of the economy; economic objectives: and instruments
of control.
A number of important areas of analysis were mentioned
as particularly deserving of further study; the role of capital
accumulation in economic development; the relationships of
education and of scientific research to economic growth; the
desirability of introducing to a greater extent than hitherto a
regional dimension into econometric models so as to connect
the economic structure of a nation with that of its constituent
regions; and the urgency of developing techniques of quan-
titative analysis suited to the less advanced areas of the world.
Emphasis was also placed on the need for the systematic testing
of theory against facts in the construction of explanatory,
forecasting and planning models, and on the importance of
publishing the results of such tests. (Only in this way can
the experience of one country serve as a guide to further studies
in other countries.)
Our discussion brought forcefully to our attention the need
for both empirical and theoretical analysis of the social object-
ives of economic development, comparable in purpose and
quality with current research into technological conditions and
economic relationships. Social objectives cannot be deduced
