Visiting economics conferences and seminars, the sessions usually start with the presentation of mathematical-statistical models building on assumptions somewhat analogous to “let us assume that people are green and descending from Mars” — and then long technical discussions follow on how good these models are at making us better understand contemporary societies and economies. Yours […]
economics
Of all the recent failures of the Australian mainstream media, the failure to properly report and analyse the trilateral security partnership known as AUKUS must surely qualify as the most pitiable.
A couple of years ago, Paul Krugman had a piece up on his blog arguing that the ‘discipline of modelling’ is a sine qua non for tackling politically and emotionally charged economic issues: In my experience, modeling is a helpful tool (among others) in avoiding that trap, in being self-aware when you’re starting to let your […]
När tankesmedjan Katalys nu firar tioårsjubileum har man passande nog valt att bjuda in författaren till en av årtiondet största megahit inom ekonomiområdet — Underskottsmyten — Stephanie Kelton. Har ni vägarna förbi Stockholm den 6 maj tycker jag definitivt ni ska lägga ett par timmar på att besöka ABF-huset! Yours truly har under flera års […]
The problem of the DSGE-models (and more generally of rational expectations macroeconomic models) is that they assume extraordinary cognitive capabilities of individual agents … The fact that the assumption of rational expectations is implausible does not necessarily mean that models using such an assumption cannot be powerful tools in making empirical predictions. The problem, however, […]
The unsellability of DSGE models — private-sector firms do not pay lots of money to use DSGE models — is one strong argument against DSGE. But it is not the most damning critique of it. The most damning critiques that can be levelled against DSGE models are the following two: (1) DSGE models are unable to […]
Modelling by the construction of analogue economies is a widespread technique in economic theory nowadays … As Lucas urges, the important point about analogue economies is that everything is known about them … and within them the propositions we are interested in ‘can be formulated rigorously and shown to be valid’ … For these constructed […]
Knowing can be a curse on a person’s life. I’d traded in a pack of lies for a pack of truth, and I didn’t know which one was heavier. Which …
The post Keynes’ wisdom still stands; “Anything we can actually do we can afford.” appeared first on The Gower Initiative for Modern Money Studies.
A couple of years ago, Robert Lucas gave an outline of what the new classical school of macroeconomics thought about the latest downturns in the US economy and its future prospects. After stating his view that the US recession that started in 2008 was basically caused by a run for liquidity, Lucas then goes on […]
Mainstream (neoclassical) economics has always put a strong emphasis on the positivist conception of the discipline, characterizing economists and their views as objective, unbiased, and non-ideological … Acknowledging that ideology resides quite comfortably in our economics departments would have huge intellectual implications, both theoretical and practical. In spite (or because?) of that, the matter has […]