They try to explain business cycles solely as problems of information, such as asymmetries and imperfections in the information agents have. Those assumptions are just as arbitrary as the institutional rigidities and inertia they find objectionable in other theories of business fluctuations … I try to point out how incapable the new equilibrium business cycles […]
economics
. ‘Rigorous’ and ‘precise’ economic models cannot be considered anything else than unsubstantiated conjectures as long as they aren’t supported by evidence from outside the theory or model. To my knowledge, no in any way decisive empirical evidence has been presented. No matter how precise and rigorous the analysis, and no matter how hard one […]
What economics does is to convert open systems into closed systems by excluding ‘moves’ which would render the system unstable. Dictators ‘freeze the frame’ by order: economists do it by ‘modelling.’ They model the world as a giant computer network in which every possible move has been programmed, and anything outside the frame excluded by […]
. Public debt is normally nothing to fear, especially if it is financed within the country itself (but even foreign loans could benefit the economy if invested correctly). Some members of society hold bonds and earn interest on them, while others have to pay taxes that ultimately pay the interest on the debt. However, the […]
Defenders of microfoundations and their rational expectations-equipped representative agent’s intertemporal optimisation often argue as if sticking with simple representative agent macroeconomic models does not impart a bias to the analysis. Yours truly unequivocally rejects that unsubstantiated view. These defenders often also maintain that there are no methodologically coherent alternatives to microfoundations modelling. That allegation is, […]
Hans-Georg Backhaus è morto ieri, 8 marzo, all’età di 96 anni. Era mentalmente in forma e continuava a leggere e lavorare, ma qualche giorno fa è caduto ed è stato portato in ospedale, dove è morto serenamente tre giorni dopo. Backhaus era nato a Remda, in Germania (poi Repubblica Democratica Tedesca), nel 1929. Negli anni […]
När Finanspolitiska rådet för några veckor sedan kritiserade regeringen för att inte ha följt sina egna (rampolitiska) ekonomiska regler, kunde den socialdemokratiske skuggfinansministern Mikael Damberg uppenbarligen inte låta bli att ta tillfället i akt och i populistisk anda ondgöra sig över att “våra barn och barnbarn kommer behöva betala för att svenska politiker i dag […]
No, there is nothing wrong with mathematics itself. No, there is nothing wrong with applying mathematics to economics. Mathematics is a valuable tool — one among several — for understanding and explaining economic phenomena. What is wrong, however, is the naïve belief that: maths is the only valid tool maths is universally and self-evidently applicable […]
~by Sean Paul Kelley I’ll begin, as usual, with the economy. JP Morgan lays odds for a global recession at 60% now. Causes? According to JPMorgan it’s threefold: the conflict in Iran, the tariffs and AI. But JP Morgan is forgetting another huge variable, the private credit/shadow credit unwind happening in real time. Blackrock halted […]