It is fair to say that faith in economists, and economic forecasts, has taken a hit in recent years. Part of that comes down to the unprecedented nature of shocks to the global economy, from the pandemic to geopolitical tensions and war. But a considerable element owes itself to macroeconomists’ sometimes blinkered focus on theoretical models.

Shocks, Crises and False Alarms by Philipp Carlsson-Szlezak and Paul Swartz (Harvard Business Review Press, ￡25) lays out a rational new approach for decoding the international economy in uncertain times. The authors, both economists at Boston Consulting Group, think the current focus on simplistic models of cause and effect increasingly fails to account for the true complexity and dynamism of macroeconomic relationships. Their approach is built on three core pillars.